Prospects for assessing financial ratios in crisis and postcrisis economy

Abstract

Introduction. Assessment and interpretation of the values and levels of calculated indicators of financial activity of companies is a traditional issue for the micro level of the economy. At the same time, at the macro level, when calculating average industry indicators, two approaches are usually used. They are calculation of the average weighted value (practiced by statistical agencies) and calculation of median values based on data from all companies in the industry (practiced by information and analytical systems, for example, SPARK-Interfax). It seems advisable to conduct a comprehensive study of the dynamics of specific indicators in times of crisis and limited information, which will allow the formation of an approach to assessing the real average level of these indicators for a specific industry. Goal. The purpose of the work is to develop an approach to assessing the values of average industry indicators of return on equity of companies in the chemical industry and to develop prospects for the further development of this approach.Materials and methods. The information base of the study included statistical materials from Interfax (reporting of companies in the chemical industry), Rosstat (EMISS), and SPARK-Interfax data. The work accumulated data for the period from 2019 up to the present moment. The authors used financial analysis methods to calculate specific coefficients and deterministic modeling methods to assess the impact of factors on the level of return on capital. Notably, the absolute values of the total net profit and equity of the groups of companies identified by the authors were used as factors, which made it possible to show the impact of the oligopolistic market structure on the information reliability and transparency of a particular industry. As part of the assessment of the statistical characteristics of the sample, methods for calculating power and structural, i.e. robust, averages were used.Results and discussion. The study was based on the materials of modern theoretical and methodological studies. The authors accumulated modern problems of assessing and interpreting the return on equity ratio and its applicability for analyzing the activities of companies. The problem of information transparency of financial statements of a specific industry – the chemical one – was studied with the reference to current legislation, crises, sanctions pressure and the response to it from the Russian government and industry leaders. The quantitative analysis continues the previous parts of the study and shows how the measures used, on the one hand, protect the information field of the Russian economy, and on the other hand, hinder an adequate assessment. To solve the latter problem, the authors propose a specific approach to assessing the level of the return on equity ratio.Conclusion. The main problems of financial analysis at the industry level are studied. The directions for the development of the theory and practice of financial analysis are proposed in order to improve the interpretation of empirical data in the current economic conditions.

Keywords

• financial analysis
• profitability
• statistics
• robust estimates
• return on equity
• industry analysis