Actual Problems of
Economics and Law




DOI: 10.21202/1993-047X.11.2017.1.18-33

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Authors :
1. Svetlana O. Musienko, post-graduate student of the Department of Corporate Finance and Corporate Management
University for Finance of the Government of the Russian Federation

Financial analysis and forecasting of the results of small businesses performance based on regression model

Objective: to develop the economic-mathematical model of the dependence of revenue on other balance sheet items, taking into account the sectoral affiliation of the companies.

Methods: using comparative analysis, the article studies the existing approaches to the construction of the company management models. Applying the regression analysis and the least squares method, which is widely used for financial management of enterprises in Russia and abroad, the author builds a model of the dependence of revenue on other balance sheet items, taking into account the sectoral affiliation of the companies, which can be used in the financial analysis and prediction of small enterprises’ performance.

Results: the article states the need to identify factors affecting the financial management efficiency. The author analyzed scientific research and revealed the lack of comprehensive studies on the methodology for assessing the small enterprises’ management, while the methods used for large companies are not always suitable for the task. The systematized approaches of various authors to the formation of regression models describe the influence of certain factors on the company activity. It is revealed that the resulting indicators in the studies were revenue, profit, or the company relative profitability. The main drawback of most models is the mathematical, not economic approach to the definition of the dependent and independent variables. Basing on the analysis, it was determined that the most correct is the model of dependence between revenues and total assets of the company using the decimal logarithm. The model was built using data on the activities of the 507 small businesses operating in three spheres of economic activity. Using the presented model, it was proved that there is direct dependence between the sales proceeds and the main items of
the asset balance, as well as differences in the degree of this effect depending on the economic activity of small enterprises.

Scientific novelty: the article presents a regression model of dependence of revenues on the major categories of assets for small businesses based on the principles of economic expediency, not of mathematically correct dependencies.

Practical significance: the main findings of this paper can be useful in the practical management of small businesses, for financial analysis and forecasting, in particular in the benchmarking of companies in certain sectors. In addition, the results of this research can be used in scientific and teaching activities in covering the issues of financial management of small businesses.

Keywords :

Economics and national economy management; Small enterprises; Small business; Financial management; Regression analysis; Economic-mathematical modeling; Financial analysis; Financial forecasting; Benchmarking

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Citation :

Musienko S. O. Financial analysis and forecasting of the results of small businesses performance based on regression model, Actual Problems of Economics and Law, 2017, vol. 11, No. 1, pp. 18–33 (in Russ.). DOI: 10.21202/1993-047X.11.2017.1.18-33

Type of article : The scientific article

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