N Research Of Setting Up Financial Risk Warning System For N Engineering Corporation

Financial condition of a corporation is always the focus of the corporation itself and investors. A corporation with good business and healthy finance will promote not only its competition capability but also investors' confidence. On the contrary, a corporation with bad finance or even on the verge of bankruptcy will not only lack competition capability but also face crisis. Therefore, noticing signs of financial risk beforehand will make it possible for corporations to take effective measures to improve business policy and avoid financial crisis. This is exactly the motivation of the study in this thesis. By investigating financial risk management situation of N Engineering Corporation in detail, using methods combining quantity and quality, a financial risk warning system is set up for the corporation. The aim is to help the corporation avoid financial crisis and keep business steady and continuous. Hopefully, the thesis will be of help for other corporations who need to avoid financial risk.Main contents of the thesis are as follows:First of all, background, intention, subject and methods of the study are discussed respectively.Then, theories relevant to financial risk warning are given to set the foundation for the set-up of financial risk warning system for N Engineering Corporation, which include risk, financial risk and it's classification, meaning and features of financial risk warning, regular measures and programs for financial risk warning. Thirdly, basic information and financial management condition of N Engineering Corporation are provided, with the emphasis on objective analysis of main risks it faces. Based on the analysis, index system of financial risk warning for the corporation is build up, using comprehensive scoring method. The system is also tested with data from the corporation's financial report of year 2004 and 2005. Financial risk level of the corporation is then judged after comparing the scores output by the warning system with values predicted by Z-model of financial risk warning.