Research On Financial Risk Management Of Cash Flow Of Company A

With the outbreak of new novel coronavirus(2019-nCoV),which directly result many enterprises' cash flow problems in 2019.Even the well-known restaurant Xibei claims that it will not be able to pay off wages if it fails to operate for three months.In recent years,more and more enterprises have been stagnated or even closed down due to cash flow problems.From the Bicycle-sharing enterprises to many P2 P financial management platforms failed to keep up with the cash flow.We can see that an enterprise with outstanding performance may collapse if it encounters a cash flow fracture.Therefore,many business leaders expect to prevent and deal with the financial risks of cash flow through effective management.In this paper,through the empirical case study to improve the current financial risk management theory of cash flow.Besides,through the establishment of cash flow financial risk assessment model,which can effectively help managers to identify risks,take effective measures to deal with the risks in time,so as to avoid losses.Therefore,this paper emphasizes the importance of cash flow financial risk management,through the analysis of the cash flow of company A for five years to identify the existence of cash flow financial risk of company A.Through the analysis,it is found that A company's many financial indicators of cash flow are lower than the standard value,and some of the indicators are extremely unstable through vertical comparison.There are cash flow risks,mainly including: insufficient solvency,poor liquidity and poor quality of profitability.Then through the principal component analysis method to build the company A's cash flow financial risk assessment model: F=0.43716 F1+0.33173 F2,and to score and assess the company A's quarterly cash flow situation for the year of 2014-2018.And we can see that company A's cash flow comprehensive score is decreasing for recent years and its cash flow financial risk is high.Finally,according to the current financial risk of cash flow,the paper proposes that enterprises can manage the financial risk of cash flow by strengthening the risk management awareness of employees,improving the accuracy of budget,and regularly doing cash flow analysis and assessment.