Research On The Financial Risk And Risk Control Of Company A

With China’s Shenzhen Stock Exchange set up GEM on October23,2009, theavenue of financing of SMEs in China open a new page. Listed companies on GEM hasits own special features, including small scale, the performance is not outstanding, highgrowth, high risk and business tech. As China’s GEM has just set up, mechanisms andrules remain to be tested by the market. For company A listed on GEM, all these factorsmake company A’s operating uncertainties will become more pronounced. Therefore it isnecessary to evaluate the financial risk scientific and comprehensively, and strengthenthe control of business risk in the production and management process, so that companyA will sustained and healthy growth.By learning the basic theory of financial risk and analysis company A’s financialrisk，this paper hold the view that we should evaluate the overall financial risk ofcompany A, and raise the ideal of financial risks including hidden financial risk anddominant financial risk. According to this view, the paper built a comprehensivefinancial risk evaluation formed by two financial risk subsystems, then use AHP and theEfficacy coefficient method to evaluate the two subsystems on Company A. Thisapproach, basis on two aspects, makes enterprises to comprehensive evaluate andunderstand the current financial risks. Finally, with the actual situation of company A,from hidden financial risk and dominant financial risk, this paper gives some specificstrategies to avoid company A’s financial risk.