Research On Financial Risk Identification And Control Of H Group Companies Based On Cash Flow

In the increasingly fierce market competition,there are numerous instances of financial crises caused by loopholes in the control of financial risks.The disadvantages of the traditional accrual-based financial analysis method,influenced by accounting policies and human factors,are also becoming apparent.To effectively prevent financial risks,enterprises should start from the actual enterprise,based on cash flow to establish a financial risk identification framework to strengthen financial risk control.In this paper,by systematically studying cash flow theory and financial risk control theory,we organically combine cash flow theory and financial risk control theory to analyze the financial risk of H group companies from the cash flow perspective.In this paper,H Group Company is selected as the research object to study the operation risk status of enterprises in different aspects of business activities,investment activities and financing activities from the two aspects of cash flow structure and cash flow related indicators,and by selecting the cash flow indicators and assigning their weights,the financial risks of H Group Company are analyzed in five dimensions: debt service capacity,operating capacity,profitability,profit quality,payment capacity and development capacity.In this paper,it is found that under the cash flow structure perspective,companies spend the majority of their time in a situation where operating activities do not bring stable cash flow to the company,overextend blind investment and rely too much on debt financing.At the same time,using cash flow-related indicators to analyze the financial situation of enterprises,it can also be seen that the debt service capacity,profitability profitability quality,operating capacity,payment capacity and development capacity of enterprises are weak.The analysis based on both perspectives of cash flow indicates that the business is currently facing serious financial risks and that the business is not doing well.In response to the issues identified,this paper proposes to strengthen the financial risk control of H Group companies in three main areas:operating activities,investment activities and fund raising activities.This is reflected in the following: optimizing the operating strategy and promoting the improvement of the return rate;rational planning of the investment structure and seeking diversified development;broadening the financing channels and "blood transfusion" for the enterprise.The purpose of controlling the financial risks of the enterprise is achieved through these initiatives.