Study On The Financial Distress Problem And Solution Of Jianrui Woneng

Financial distress is also called "financial crisis".With the rapid development of the world economy,the external operating environment of enterprises is complex and changeable,and business risks and financial risks are also increasing.More and more companies are falling into financial distress.The emergence of financial distress does not happen suddenly,but is a gradual process that is gradually affected by the internal and external factors of the enterprise,from the deterioration of the financial situation to the tightness of the capital chain,the inability to repay due debts,continuous losses and even bankruptcy applications.Financial distress has become an important subject in the field of financial research in China.China’s research on financial distress started late,and research on the financial distress of the new energy industry is even less.In recent years,people have paid much attention to environmental pollution and energy crisis.The development of new energy vehicles has become a global consensus.With the country’s strong support for the new energy vehicle industry,the new energy vehicle and power battery industries have developed rapidly,but Jianrui Woneng Company has encountered financial difficulties in entering the power battery industry within two years,and even at risk of suspension and termination.Therefore,in this paper,we take Jianrui Woneng Company as the research object to conduct a comprehensive and systematic analysis of Jianrui Woneng’s financial distress,so as to find out the cause of financial distress and its countermeasures.The thesis uses a variety of methods such as literature research method,case analysis method and comparative analysis method for analysis and research.Firstly,by collating and summarizing relevant literature and basic theories at home and abroad,it provides a certain theoretical basis for analyzing the financial distress of Jianrui Woneng;secondly,by referring to Jianrui Woneng’s financial statements from 2014 to 2019 and the collected data,describe the specific performance of Jianrui Woneng’s financial distress in terms of cash flow,profitability,and solvency,and use the Z-score model to evaluate the company’s financial risk;then analyze the reasons why Jianrui Woneng was in financial distress from the external and internal aspects.The external reasons include the decline of the industry subsidy policy,the negative growth of new energy vehicles,the sharp rise in raw material prices,and fierce market competition etc..The internal reasons include the company’s unreasonable business layout,failed performance gambling,excessive expansion,excessive reliance on debt,insufficient R&D investment,etc.;finally,combined with the current status of the company’s implementation of the reorganization plan,propose a series of countermeasures and suggestions to get rid of financial distress,including promoting the implementation of the reorganization plan in accordance with the law,introducing strategic investors to resume production,strengthening the collection of receivables,optimizing the main business structure,and improving internal control system,etc.,and put forward the inspiration from the case,hoping to provide reference for companies in the same industry,reminding companies in the same industry to pay more attention to financial early warning in the process of enterprise development,to avoid falling into financial distress.