Financial Diagnosis And Analysis Of Taihe Group Co.,Ltd

With the continuous prosperity and development of the market economy,Chinese enterprises face a growingly complex competitive environment.It places higher requirements on the financial management levels of enterprises.Financial diagnosis is an effective means of testing the financial management level of an enterprise.Financial diagnosis,as an important discipline of application and management,makes a comprehensive analysis of the financial status and operation achievements of an enterprise.It thus helps to find the problems or disadvantages of operation management,explore the reasons for such problems,and eventually put forward feasible solutions to entrusting enterprises.The real estate industry has become a pillar industry in the national economy,which is related to the stability of economic development and the level of people's living standards.Taihe Group Co.,Ltd is a "black horse" in the real estate industry.Based on Fujian Province,its real estate business soon expanded across China and reached the sales volume of more than a hundred billion in 2017.On the other hand,Taihe Group Co.,Ltd is perplexed by a surge in liabilities,a decline in the gross profit rate of sales,and strained capital chains due to its excessively rapid expansion.Meanwhile,the complex industrial environment also poses challenges to corporate development.The paper mainly studies Taihe Group Co.,Ltd,diagnoses the deficiencies in its financial management and eventually puts forward advice for optimizing its operation and management.The paper consists of six parts.The first part is the introduction,which elaborates the research background,significance,literature review,research contents,and methodology.It focuses on introducing the research achievements made in financial judgment,the theoretical foundation and research methodology used in the paper.This part lays a foundation for subsequent parts.The second part includes the corporate profile and industrial analysis.It mainly introduces Taihe Group Co.,Ltd's development course,main business,operation status,and the advantages and disadvantages of industrial development.The third to fifth parts respectively include the structural analysis of financial statements,the analysis of financial capacity,and the general analysis and diagnosis.Firstly of all,the paper analyzes the financial data of Taihe Group Co.,Ltd between 2013 and 2017 through structural analysis,trend analysis,and proportion analysis.It is found that the group faces a series of problems compared to the average industrial level,including weak solvency,severe asset restrictions,low inventory turnover,and high financial pressure.Next,the paper finds the reasons for such problems through Radar Chart Analysis,improved DuPont Analysis,and chain substitution method.Meanwhile,the paper finds two core indexes,including NOATR(Net Operating Asset Turnover Rate)and IRATR(Interest Rate After Tax Rate).The sixth part includes the results of the financial diagnosis and advice for improvement.The problems faced by the company include a high funding scale,difficulty in de-stocking,and high expenses.This part puts forward corresponding advice,including making real-time adjustment of the capital structure and the reasonable allocation of debt maturities;accelerating the inventory cycle from beginning to end and setting up a complete receivables management system;paying attention to the policy-oriented allocation of property assets and improving cost and expense control.