The Research On Financial Risk Assessment And Control Of Country Garden

In recent years,due to the effective market demand brought by adjusted economic growth,acceleration of urbanization process,increase of the citizen income and upgrade of consumption structure,China's real estate investment and commercial housing sales showed a sustained growth trend.But according to the Financial Safety Assessment Report of China's Non-financial Listed Companies in 2016,the overall safety of the real estate industry is the worst among the 25 industries,which has accumulated a lot of financial risks.Country Garden is a comprehensive real estate developer with leadership in China,ranking 3 in national real estate enterprises in 2017.In 2016,its sales volume was 308 billion RMB and sales area was 37 million square meters,which increased by 120%and 74%respectively on year-on-year basis.However,the international rating agency Standard&Poor's downgraded its rating because of the deterioration of profit margins and financial leverage,which indicates that with the rapid growth of Country Garden's sales volume,its financial risk is increasingly prominent.This dissertation selects Country Garden as the research object.At first,this dissertation defines the concept and classification of financial risk,and elaborates the theory of risk management,the theory of capital structure and the theory of portfolio,which are put as the theoretical basis for the research.Then,this dissertation identifies the risk of Country Garden from four aspects of financing,investment,operation and income distribution and analyzes the reasons based on the related financial data and actual operation situation from 2012 to 2016.Next,this dissertation establishes the financial risk assessment index system of Country Garden,and evaluates its financial risk in 2016 by factor analysis,so as to quantify its position in the financial risk of the same industry.The research shows that in 90 real estate listed companies,Country Garden ranks 25 with F value of 0.7570,which is in the middle and upper reaches.In the single factor rankings,the operating factor ranks 37,the cash flow factor ranks 31,the profit and growth factor ranks 20,the debt paying and growth factor also ranks 20 and the debt paying factor ranks 71.The rankings show the solvency is obviously in the lower reaches of the industry,and there is also much promotion space for other aspects.Finally,considering the results of financial risk identification and assessment,this dissertation puts forward the measures to control financial risk from four aspects of financing,investment,operation and cash flow management,in order to help Country Garden to reduce financial risk and improve the ability of financial risk prevention.