Early Warning Study Of Financial Risk Of Zhengbang Technology Based On Entropy Method

The development of enterprises is influenced by many internal and external environments,especially in the current economic downturn environment,financial risk issues frequently appear.Financial risk cannot be accurately determined by simple financial index analysis alone,and has limited effect on the identification and diagnosis of financial risk for the whole enterprise.Pork is a food of immediate demand in China,and there are many enterprises engaged in pig farming.Zhengbang Technology Co.,Ltd.is one of the leaders in the livestock industry.The financial statements of Zhengbang Technology Co.,Ltd.in 2021 show that the company has a huge loss and the capital chain is broken,and the company is facing a financial crisis.Based on the study of various early warning models and risk analysis at home and abroad,this paper concludes that using the entropy method to construct a financial risk index system and conduct comprehensive evaluation is a more effective method for early warning of enterprise financial risks.In this paper,the entropy weight method is firstly used to construct the financial risk index system of Zhengbang Technology,and the relative weights of each index are calculated;then the Pearson correlation of each index is calculated by using SPSS software,and the weak correlation indexes are eliminated,and the strong correlation indexes are screened and assigned with secondary weights.The early warning situation was verified and analyzed.The comprehensive analysis concludes that the outbreak of African swine fever in 2018 severely affected the breeding enterprises including Zhengbang Technology,which significantly reduced its operating income.2020 ignored the objectivity of the swine cycle and blindly expanded without taking into account the characteristics of livestock enterprises,making the proprietary assets at the back end of the value chain increase significantly and making it more difficult to realize.During the downward phase of the pig cycle,assets and personnel were idle in large quantities,and huge losses were incurred in 2021.It can be seen that the financial risk of Zhengbang Technology in the past five years is mainly caused by African swine fever and the substantial expansion by ignoring the objectivity of the swine cycle.Therefore,enterprises should correctly understand the special characteristics of the livestock industry,establish an early warning mechanism for financial risks,increase investment in prevention and control of swine fever and the downward phase of the swine cycle,and avoid the impact of a sudden drop in operating income on net profit.Actively cultivate the core competitiveness of the enterprise to protect the future healthy and stable development of the enterprise.