Research On Financial Risk Early Warning Of AS Company Based On Cash Flow

Under the advancement of economic integration,the corporate economy is facing new opportunities and challenges.Meanwhile,traditional financial concepts already no longer meet the new social and economic development.Moreover,financial crises often occur.How to build a corporate financial risk early warning system is facing a realistic challenge.In the daily operation and management of enterprises,insufficient cash flow can easily cause the company to break out of financial crisis.Therefore,ensuring sufficient and stable cash flow supply will help the company achieve sustainable development,and even to a certain extent,it is more beneficial than the company’s excess profits.Big.Cash flow has strong risk warning properties.Cash flow management guarantees the cost and repayment of enterprise operations.On the one hand,it has an acceleration effect on the overall capital turnover of the enterprise,and on the other hand,it reduces the financial pressure of the enterprise.Therefore,from the perspective of cash flow,this article conducts an early warning study on AS Coal Company’s financial risks,hoping to provide a reference for related research.On the basis of reviewing the relevant theories of domestic and foreign financial risks and financial risk early warning,the paper first analyzed the financial data of AS Company from2015 to 2020 by using the indicator method,and found that AS Coal Company has higher potential financial risks in recent years.A scientific and effective early warning system has not yet been formed;an improvement strategy has been formulated for the company’s shortcomings in the financial risk forecast alertness,and a series of indicators for early warning financial risks based on cash flow has been constructed,and the efficiency coefficient method after the improvement has been used.A financial risk early warning model that conforms to the actual situation of AS coal enterprises has been constructed,and the inspection and analysis of early warning conclusions are more scientific and effective.Through results of empirical researches,this paper finds that financial risks of AS company are mainly manifested in the following four aspects: the insufficient management of accounts receivable;the poor development ability of net cash flow from operating activities;the tight financial flexibility and poor abilities to adapt to changes and use investment plans in the economic environment;poor operating capacity,slow inventory turnover.According to each problem,four specific solutions to reduce financial risks are proposed.Firstly,it should improve the management system of accounts receivable and speed up their returning.Secondly,it should enhance the ability to develop net cash flow from operating activities,establish the monitoring department of financial early warning system and deepen the ideological building of this system.Thirdly,it ought to strengthen cash flow management,improve financial flexibility and implement a cash flow budgeting system.Fourthly,improve the operation capacity,strengthen the speed of inventory turnover.The crisis prevention and governance measures proposed in this article provide AS companies with new ideas for timely detection and prevention of financial risks and adjustment of business strategies.They also provide references and references for domestic coal companies to build scientific and accurate financial risk early warning systems.