Research On The Quality Of Fei Da Enviro Based On Grey Relational Analysis

Earnings quality can reflect the operation of an enterprise,which is the focus of attention of enterprise stakeholders in both quantity and quality.In recent years,the environmental protection industry and its sub-sectors have favorable policies and developed rapidly.Therefore,this paper focuses on the air pollution control industry and selects Zhejiang Fei Da Environmental Science & Technology Co.,Ltd.as a research case.Fei Da Enviro is the only national major technology and equipment localization base in the environmental protection industry.After listing,it enjoys great popularity and is highly praised.However,in recent years,its performance has declined,its internal control is chaotic,and even it has suffered losses year after year.The poor financial performance of Fei Da Enviro in recent years indicates that there may be some problems in its profit quality,which needs further analysis and evaluation.In this paper,we find that few scholars can set up a profit quality index analysis system for an enterprise.The selection of financial indicators is inevitably subjective and random,and we simply copy the inherent index analysis system for research.Therefore,this paper studies and analyzes the profitability of enterprises in three steps:First,it introduces the grey relational analysis method to calculate the correlation degree between relevant financial indicators and the net profit attributable to shareholders of listed companies,selects financial indicators,and establishes a targeted profitability index analysis system suitable for Fei Da Enviro.Secondly,introducing the financial data of enterprises in the same industry,calculating the industry average,analyzing the stability,growth,cash security and profitability of profit quality in Fei Da Enviro horizontally and vertically,and combining the analysis of internal and external influencing factors,it is concluded that the stability of Fei Da Enviro’s profit quality is poor,and the growth ability is low.Although the cash security can maintain a balance,the profitability of enterprises needs to be improved.Third,it is suggested that Fei Da Enviro should increase the competitiveness of its main business,reduce the risk of debt,improve the efficiency of capital use,actively revitalize idle assets of enterprises,speed up capital circulation,strictly control the internal control of enterprises,and actively take measures to resist the impact of domestic and foreign market environment on enterprises,seize opportunities and be brave in challenges.As a large listed company in environmental protection industry,the research on the current situation and problems of Fei Da Enviro’s profit quality is representative,and has certain reference value for other peers.