Research On The Financial Risk Pre-wanring System Of DY Corporation

Environmental protection industry is an important industry which promotes the sustainable development of economy and society.With the support of environmental protection policy,the industrialization application of PPP and the rise of third party governance,the environmental protection industry is developing rapidly.However,environmental protection enterprises are confronted with many challenges at the same time.This paper aims at the environmental protection industry enterprise DY Corporation and helps it to forecast and control the financial risk by carrying on the financial risk early warning research.Firstly,this paper analyzes the literatures about financial risk early warning research at home and abroad and points out the problems existing in the current research.Then the paper expounds the related theories of financial risk and financial risk early warning.By analyzing the financial risk and warning status of DY Corporation,this paper points out the problems existing in the current financial risk warning work of it.On this basis,this paper constructs the financial risk pre-wanring system from five aspects,which are solvency risk,profitability risk,operating ability risk,earning ability risk and developing ability risk by means of Entropy method and Wall Scoring method.The system is applied to the early warning of the financial risk of DY Corporation.Finally,the paper puts forward some safeguard countermeasures for DY Corporation to apply the financial risk pre-wanring system.In this paper,the Entropy Theory and financial risk early warning are applied to the study of financial risk pre-wanring system of the specific case company.The case company's industry characteristics and the company's specific financial risk situation are used to establish the financial risk pre-wanring system.The establishment of indicators in the pre-wanring system and the setting of weights are based on the company's own financial situation.The financial risk pre-wanring system constructed in this paper has a certain guiding role in predicting and preventing the financial risk of DY Corporation,which also provides an effective management tool in the financial risk management activities for other companies in the environmental protection industry.