Research On Financial Risk Early Warning Of Ningxia BF Company

With deepening internal reform and opening up,the number of Chinese enterprises is increasing incredibly,behind the increase in quantity is the quality problem of poor management and frequent financial crisis.In recent years,the condition of the capital flow of listed companies is broken because of financial fraud or poor management and the debt of creditors can not be paid off,whereas,the chemical energy enterprises belong to the capital-intensive and technology-intensive industries,the capital demand for financing is large,high cost and the construction period is long,and the speed of capital return is slow.Therefore,the article takes the financial crisis of Ningxia Baota Petrochemical Company in the same industry as a warning,and thinks that it is necessary to carry on the financial risk early warning research to this kind of listed company,to discover and against the financial risk in time,to promote the sustainable development of enterprises.The article takes Ningxia BF Company as the research object to study the financial risk early warning.Firstly,the article introduces the general situation and organization structure of Ningxia BF Company,and analyzes the main sources of BF Company’s financial risk from macro-environment and micro-environment aspects,in the macro context,the risk sources include industry policy risk,product price fluctuation risk and so on,in the micro context,the risk sources are analyzed from five aspects:solvency,profitability,liquidity,cash flow and operating growth,mainly debt service risk,over investment risk and the risk of business growth slowing,then,the article analyzes the present situation of BF Company’s financial risk early warning,and discovers some problems including inadequate financial risk warning mechanism,the Risk Early Warning Department’s setting is not suitable,unscientific early warning methods and so on;Secondly,according to the qualitative analysis of financial risk and the problems existing in financial risk early warning,it is necessary to construct a financial risk early warning system,screening index and constructing index system by entropy method combined with correlation analysis,then the index system is calculated by using the method of efficacy coefficient to get the early warning score and determine the early warning grade;Finally,according to the analysis result of the combination of qualitative and quantitative analysis,it is suggested that the risk early warning department should be set up and the operation mechanism of the early warning system should be improved,and optimize the capital structure,reasonable financing,continue to strengthen cost control and inventory management,promote production and marketing balance and other risk prevention countermeasures.