The third in 2012 meeting of the EBA Southern Ukrainian Office Finance and Tax Committee took place in Mykolaiv

The third in 2012 meeting of the EBA Southern Ukrainian Office Finance and Tax Committee took place on November, 13, 2012 in Mykolaiv in MBA-Center office. The meeting frames encompassed seminar “Is your business efficient? About finance for financiers and non financiers. Risk assessment and financial indicators”, presented by Lyubov Roshchyna, Baker Tilly Ukraine Audit Department Manager, EBA Finance and Tax Committee in Odesa Chairman.

At the beginning of the meeting Mrs. Roshchyna told that business efficiency consists of two components: business value and efficiency of stockholder’s equity usage. She noticed that there are 3  main methods of business value assessment: 1) profit  approach – value consists of present worth of forecast cashflow and terminal value; 2)  comparative approach -  market price of  compared companies,  derived from stock- exchange quotations or pursuant to  deals’ conclusions,  corresponds with their  financial/ operation indexes; 3) cost-  based approach relies on replacement principle: expenses are determined necessary for reproduction or  replacement of  appraisal object taking into account current prices.

Also the Committee participants became aware of main financial ratios: profitability, turnover, liquidity, capital structure and financial multiples. They are used by creditors for credit rate assessment, by investors for forming hypothesis on future profit and dividends, by top management for evaluation of strategy financial component, by financial managers for obtaining information on efficiency of management decisions.

  In the end Mrs.Roshchyna proposed the participants to practically consider case of one Ukrainian company. Using financial statements and list of financial ratios the participants had to make initial analysis of financial statements and find out project main risks.