The Influence Of Debts-to-shares Policy To The Enterprise's Financial Situation And Opinion--The Case Analysis Of Enterprise A

The policy of Debts-to-Shares swap is transforming Creditor's Right of State-owned commercial banks into share holder's Right of state-owned enterprises in large and medium size. The share is held by AMC who acts as a share-holder to participate in the mater of decisions. The final objective is to promote reform and synergism, and retrieve state-owned capital. In this way, the bank can strip off unhealthy assets and improve the assets quality. As for the enterprises, who unload a part of debts, and improve the assets structure, they can run with light packs and accelerate the reform and development. However, the reduction of the enterprise's liabilities rate is not based on the strengthen of asset' profit-making ability.How to furtherly deepen reform and strengthen the real profit-making ability? Here We give a case to show the influence of Debfs-to-Shares Policy to the enterprise's financial situation, and put forward some proposals for the enterprises who carried out D-to-s policy on strengthing reform and accelerating development.We stress 3 ways in dealing with enterprise's poor profit-making ability. 1. Strip off nooperating assets. 2. Properly remove low-productive or idle assets. 3. Improve conscientiously assets' profit-making ability.If D-to-S policy can not improve enterprise's profit-making ability, phenomenas such as large Debts evading Debts responsibility will emerge.D-to-s policy can create a variety of enterprises' investing principal parts, and influence the financial main body financial objective and financial activities.This influence can hopefully deepen enterprise reform and establish modern enterprises system, improve asssefs-operating efficiency and extricate itself from a predicament.Suggestions of improving the profit-making ability of enterprise A are as follows:1. Accelerate stripping off the nonoperaing assets and laiding-off spare statf.2.Sell no-benefit assets,3.Readjust products structure and take a advantage of well-sold products.4. Cut down expenses, and reduce production costs, by advanced science technology.5.Improve insping system and restraiing system.