Financial potential as an object of financial regulation for business entities development

Lidiya Kostyrko
Doctor of Economics, Professor, Head of Finance and Banking Department, V. Dahl East-Ukrainian National University, Ukraine, e-mail: lidiyakostyrko@gmail.com, ORCID ID: https://orcid.org/0000-0002-3447-2343

Elena Sereda
Senior Lecturer, V. Dahl East-Ukrainian National University, Ukraine, e-mail: sered1010@gmail.com, ORCID ID: https://orcid.org/0000-0003-0547-2077

Cite this article:

Kostyrko, L., Sereda, Е. (2019). Financial potential as an object of financial regulation for business entities development. Ed.: M. Zvieriakov (ed.-in-ch.) and others [Finansovyi potentsial yak obiekt finansovoho rehuliuvannia rozvytku subiektiv hospodariuvannia; za red.: М. I. Zvieriakova (gol. red.) ta in.], Socio-economic research bulletin; Vìsnik socìal’no-ekonomìčnih doslìdžen’ (ISSN 2313-4569), Odessa National Economic University, Odessa, No. 1 (69), pp. 149–157.

Abstract

The article substantiates of financial potential theoretical foundations in the context of financial regulation of business entities development. The essential characteristic of the financial potential as an indicator of capital value reproduction of economic entities, which has a dynamic character, is clarified. The financial potential of business entities classification from the standpoint of a financial concept depending on the functional orientation, goal achievement, regulation period, influence factors, capital mobilization method, and types of activity, is systematized. The capital reproductive processes interrelation and potential possibilities of economic entities development is investigated. The financial potential classification according to the functional orientation is proposed as a basis for evaluating the financial potential of economic entities development, which integrates the potential of financial security, the potential of financial flexibility, the potential for value creation. The sequence of financial potential of economic entities estimation for purposes of financial regulation is revealed. Scientific and methodological recommendations can be used in carrying out a complex assessment of the financial potential of economic entities at hierarchical levels, which provides of an information base formation for identifying unused reserves and justifying the choice of financial regulation strategy of business entities development. An integral assessment of economic entities financial potential will allow to assess a degree of financial potential using, to predict its future status and to develop appropriate recommendations for business development.

Keywords

financial potential; structure of financial capacity; financial regulation of business entities development; capital; reproduction of capital; financial resources; integral assessment of financial potential.

JEL classification: G320; DOI: https://doi.org/10.33987/vsed.1(69).2019.149-157

UD classification: 336.6

This work is licensed under a Creative Commons Attribution 4.0 International License. To view a copy of this license, visit http://creativecommons.org/licenses/by/4.0/

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