Research On JH Enterprise Group Debt Risk Control

When enterprises trade off risk and return, they will integrate minimum capital cost with maximum enterprises value. To get optimum capital structure, great attention has been given to the optimum debt structure for it has proceeds from tax saving. Different debt structures correspond with different risk control levels. Debt structure determines enterprise risk control level, and enterprise risk control level results different debt structure. Enterprise's high competence on choosing best debt structure and risk control level is not only in favor of promoting enterprise management, but also inductive to improving enterprise ability of debt repayment.This paper takes debt structure and risk control in JH enterprise group between 2000 and 2006 as its research target. When the researcher combed through the documents for the theory of existing debt structure and risk control mechanism, he found that debt structure, including time limitation structure, type of debt, debt allocation structure, debt priority structure etc., contained the abilities of risk precaution level, cost control competence, debt role constrain, convertibility of fluidity and so on directly determined the enterprise's risk control ability. Whereas risk control level of debt determined type structure of debt, time limitation structure and priority structure, accordingly emerging as interactive relations. This paper used document study combining with case study as well as empirical study, so as to differ from traditional macro study on trade or country. Also this paper utilized the time serial data of JH enterprise financial report form testified the interactive relation between debt structure and risk control, and found that the enterprises in our country especially non-government enterprises preferred short term finance owing to their reflects of the sustainable ability to the imperfect capital market risk; the fluctuation of enterprises' profit directly resulted from the frequently variation of debt structure; the way of debt structure selection mainly relied on enterprises' risk control ability and level; yet macro environmental elements should not be neglected.Therefore this paper took a suggestion that when an enterprise selected a debt structure, the principal issue was to take risk control level into consideration, to think the risk scatter and gathering, meanwhile the ability of investment (into capital market) change into cash need to be attended, so to make the short term and long term return matching the risk, to guaranty capital acquirability and return rate under the situation of optimum debt structure.