Research On Financial Risk Analysis And Prevention Of Local Government Investment And Financing Platform

In the early 1990 s,China was in an important stage of comprehensively promoting urbanization.Some local governments established local government investment and financing platforms in order to alleviate the shortage of funds in urbanization.Local government investment and financing platforms have now gone through more than two decades of ups and downs.On the one hand,the local government investment and financing platform has formed a certain influence in the local area and played a very important role in the local urban infrastructure construction.However,on the other hand,local government investment and financing platforms have also exposed more acute issues such as unsatisfactory operational management efficiency,insufficient capital operation,and inadequate internal organizational management structures.For the platform itself and the legal person of the company as an investment and financing platform Local governments pose a threat.Therefore,this article hopes that through in-depth study of domestic and foreign scholars on the financial risk evaluation system,I hope to find and establish a financial risk evaluation system suitable for the platform company’s own situation,in order to assist the platform company to grasp the financial risk evaluation results in real time and accurately find The source of risk is expected to provide a reference for building a financial risk evaluation system suitable for the investment and financing platform of local governments in China and preventing financial risks.This article takes LX City Investment Corporation as the research object,first of all,it reads the literature about financial risks and local government investment and financing platforms with Chinese characteristics from domestic and foreign scholars.From the theoretical level of risk management theory and fiscal decentralization theory,it is clear The purpose and significance of the construction of financial risk assessment system by LX City Investment Corporation.Then,based on the industry characteristics of LX City Investment Company and its own operating conditions,on the basis of the above theory,from the four dimensions of debt solvency,profitability,operating capacity,and development capacity,LX City Investment Company’s three-year financial Indicators,at the same time,based on the entropy value method and the improved efficiency coefficient method,the two methods are combined to build the financial risk evaluation system of LX City Investment Company.According to the correlation analysis,the indicators in the four dimensions are selected,the weight of the indicators is calculated by the entropy method,and the financial risk evaluation of the LX City Investment Company is calculated by the improved efficiency coefficient method,and the financial risk score is calculated and analyzed.Out of the LX City Investment Corporation’s financial risk scoring results for the past three years.Finally,according to the final scoring results,corresponding risk prevention measures are proposed to provide effective means for LX City Investment to better prevent financial risks.