Study On The Financial Pre-warning In SINOVEL Based On Cash

Under the background of global energy shortage and more and more serious environmental pollution,our country began to implement the Resource conservation and environment friendly policy.In the electric power industry,wind power industry began to develop continuously.In 2006,China's wind power industry developed rapidly.The industry is overcapacity as a whole until 2011.To seize market share,many wind power enterprises reduce the cost at the price of sacrificing the quality of the products in this background.The consequences are extremely serious.Wind power industry as a whole show low margin state from 2011.The condition of cash flow statement is not optimistic.The developing course of Sinovel windtec co.,LTD.Is a microcosm of China's wind power industry development situation.This company once defined its development goals as the world's first,but its net profit declined seriously in its first year and successively into loss.With the coming of the "winter" in wind power industry,Sinovel's business performance became worse and worse.Financial situation is not optimistic.The company's cash flow status is questionable.This paper takes Sinovel as a case to research.On the basis of comprehensive summary of domestic and foreign financial early warning theory,method and model,this paper built a financial crisis pre-warning model using SD from the perspective of cash flow.This model summarizes and predicts the development trends of Sinovel's net cash flow.It also can predict the company's future cash flow.It can offer the useful information to the managers.This paper consists of six parts:(1)The introduction.It mainly elaborates the research background,significance,research contents,methods and the current research status of system dynamics and cash flow pre-warning.It emphatically elaborates the characteristics of the system dynamics theory and related knowledge,analyzes the possibility of its application in the aspect of financial pre-warning.(2)The related theory of cash flow and financial pre-warning.(3)This part analyzes the financial pre-warning status and present difficulties of sinovel technology co.,LTD.(4)According to current situation of sinovel's financial pre-warning,this part builds the cash flow financial pre-warning model using Vensim combining with the theory of system dynamics.(5)This part mainly introduces the application analysis of Sinovel financial pre-warning model and the practical application results.(6)The research results and conclusions.The main innovation of this paper are as follows:(1)Buildfinancial pre-warning model based on cash flow for wind power enterprise using SD the first time.(2)The users of the model are limited to internal users.They can describe the condition of enterprise's management at any time,make decisions by using the financial pre-warning system,monitor the performance,predict the dangerous factors and make the best remedial decisions.