Financial Diagnosis For Anyang Iron And Steel INC

Financial crisis hit the real economy, the global economy after the crisis, although manufacturing through its own development has been restored, but the slow global economic recovery, various industries and enterprises are facing many challenges. Our pillar industries-iron and steel industry is also experiencing a financial crisis after a long "winter".As is an important listed steel company in the central region, Anyang Iron&Steel Co., Ltd. also meet the tests in the tough market environment. The profitability of the company in recent years is not ideal, even a huge loss happened in2012for the first time since listing. The enterprise financial diagnosis, and taking effective measures to improve the financial condition and operating conditions is very necessary and urgent.Financial diagnosis is through the use of scientific methods and procedures to identify corporate financial management problems and to make an objective analysis and evaluation, suggest improvements and help enterprises to implement the process. It is of an extremely important theoretical and practical significance.This paper studies the case of Anyang Iron and Steel Co., Ltd.. This paper does the analysis and diagnosis of the financial condition based on the company’s financial data for the past five years. First, the relevant financial diagnosis by combing the basic theory, derive inspiration and research ideas relevant to provide a theoretical basis for the financial diagnostic procedure, then the status quo on the background and the company’s industry analysis to identify the problems of background information on the company’s financial activities after the use of financial analysis tools for financial analysis of companies, mainly through structural analysis, trend analysis of the company’s financial statements for2009-2013were analyzed using index analysis of the company’s financial capacity in recent years, including solvency, operational capacity, profitability and development capacity for analysis, a comprehensive financial analysis using DuPont analysis to evaluate the financial status of the company and help the company identify business risks and financial risks. Finally, based on the analysis and diagnosis of the formation of diagnostic conclusions, summed up the problems and the company has put forward recommendations to optimize management and improve enterprise efficiency. For companies with low solvency problem, optimize the capital structure, increase equity financing proposal. For companies operating capacity is not high, low asset utilization efficiency issues, and recommends strengthening receivables, inventories and other current assets management. For the company’s cost control is not ideal, low product profitability problems, and recommends measures to further strengthen the implementation of cost reduction and efficiency. In addition, decentralized business risk and improve the ability to resist risks in perspective, it is recommended to extend the industrial chain business, the proper development of non-steel industries. I hope to provide a reference for Anyang Iron unfavorable business situation to improve through this study.