A Study On Financial Risk Analysis And Control Of LeEco

In recent years,inefficient,extensive high-growth models that rely heavily on large investments have been difficult to continue,and the growth momentum of the traditional industries has become exhausted.In contrast,China's Internet industry has risen in a contrarian fashion.With Alibaba,Baidu,Tencent,and the new millet Internet company that has been popular in recent years,its business has penetrated into all aspects of people's lives,and at the same time,it has also produced tremendous economic benefits.Slowly established a reputation in the international market,China's Internet industry is a strong rise under the power of these companies.The profit model of China's Internet companies has been a concern for a long time.However,Internet companies have always paid little attention to their financial risks in their rapid expansion and development.As a new point of economic growth,internet companies must pay sufficient attention to the financial risks of Internet companies in order to ensure their healthy and sustainable development.The financial risks faced by enterprises are in the process of pursuing development and expansion of their own operations.Due to the company's own needs,the company's current situation is due to debt,its own business strategy,and various unpredictable internal and external factors.The financial situation falls into a possibility of negative deviation from expectations.A company that wants to ensure long-term healthy operations is concerned about its own financial status and avoids financial risks that are beyond the controllable scope,which may cause companies to lose the possibility of sustainable business development.Financial risk control is mainly based on the financial status of the company to identify financial risks,and specifically analyze the different types of financial risks faced at each stage,according to its causes and characteristics to reduce its potential losses to a minimum,in order to help achieve the maximum value of the company Change.This article selects LeEco,a well-known Internet company in China,as the research object of the case study.Since the establishment of LeEco,it has become a representative of the hot Internet companies nowadays.In just a few years,the market valuation has exceeded 100 billion yuan.Behind this rapid expansion is the actual dark current surging.Based on its in-depth understanding of its unique ecological strategy,this is the starting point for the popular event of the 2016 LeEco financial crisis.Based on the relevant concepts,this paper first uses the Z-value analysis method to identify the financial risks in the third part.Based on the Harvard analysis framework's analysis of the current financial situation of LeEco,it summarizes the main funding risks behind it,investment mergers and acquisitions risk,capital recovery risk,currency and capital risk analysis.Finally,in the fourth part and the fifth part,the issues related to the current risk control of LeEco are concluded and related recommendations are made.The paper establishes the first application of specific methods to effectively identify the company's overall risks,and then analyzes the specific financial risks and characteristics behind the company's specific financial conditions.In view of the problems exposed by LeEco.in terms of financial risk control,this paper proposes suggestions on how to strengthen budget management,improve the financial risk control system,and specify specific risk management methods.It will provide inspiration for the improvement of risk management systems for the same type of new-type Internet companies,and provide value for the further improvement of enterprise decision-making systems.