Skip to main content
SpringerLink
Log in

Small & Medium-Sized Enterprise Risk Monitoring Based on Financial Analysis Results

  • Conference paper
  • First Online:
Multiple Perspectives in Risk and Risk Management

Part of the book series: Springer Proceedings in Business and Economics ((SPBE))

  • 1234 Accesses

Abstract

In the paper, we discuss the problem of risk monitoring in small and medium-sized enterprises (SMEs). To this aim, we propose to use the results of the analysis of enterprise financial standing. We indicate the crucial groups of financial ratios as well as the most important financial ratios themselves, that should be taken into account in the process of continuous risk monitoring in an enterprise. We also present the features of eanaliza.pl online service, which can be helpful in calculating the up-to-date information on enterprise financial situation. Using the service we investigate the possible risk factors for a hypothetical small-sized enterprise. We conclude the paper by stating that the use of IT tools, such as the eanaliza.pl service, can bring important benefits to the SMEs in the context of risk management.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 129.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Hardcover Book
USD 169.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Notes

  1. 1.

    The information is crucial for the calculation of the turnover ratios (i.e. the inventories, receivables and liabilities cycles).

  2. 2.

    The reduction of the net profit between 2014 and 2017 is over five-fold, while the reductions of the net revenues from sales, the total assets and the equity are approximately equal to 2.1, 2.4, and 4.3.

References

  • Baruch, L., Shyam, S.: Methodological issues in the use of financial ratios. J. Acc. Econ. 1(3), 187–210 (1979)

    Article  Google Scholar 

  • Belás, J., Ključnikov, A., Vojtovič, S., Sobeková-Májková, M.: Approach of the SME entrepreneurs to financial risk management in relation to gender and level of education. Econ. Sociol. 8(4), 32–42 (2015)

    Article  Google Scholar 

  • Błach J.: Financial risk identification based on the balance sheet information. In: Managing and Modeling of Financial Risks, pp. 10–19. Technical University of Ostrava, Ostrava, Czech Republic (2010)

    Google Scholar 

  • Błach, J., Gorczyńska, M., Wieczorek-Kosmala, M.: Sytuacja finansowa śląskich przedsiębiorstw w dobie kryzysu. CeDeWu, Warszawa (2013)

    Google Scholar 

  • Błach, J., Gorczyńska, M., Wieczorek-Kosmala, M.: Expert ratios, Katowice (2015), priv. comm

    Google Scholar 

  • Bromiley, P., McShane, M., Nair, A., Rustambekov, E.: Enterprise risk management: review, critique, and research directions. Long Range Plan. 48, 265–276 (2015)

    Article  Google Scholar 

  • Brustbauer, J.: Enterprise risk management in SMEs: towards a structural model. Int. Small Bus. J. 34(1), 70–85 (2014)

    Article  Google Scholar 

  • Callahan, C., Soileau, J.: Does enterprise risk management enhance operating performance? Adv. Acc. 37, 122–139 (2017)

    Article  Google Scholar 

  • Continuity Insurance & Risk (CIR): Risk Software Report (2017). http://www.cirmagazine.com/pdfs/RiskSoftwareReport2017.pdf. Last accessed 01 Mar 2018

  • Cowen, S.S., Hoffer, J.A.: Usefulness of financial ratios in a single industry. J. Bus. Res. 10(1), 103–118 (1982)

    Article  Google Scholar 

  • D’Arcy, S.P., Brogan, J.C.: Enterprise risk management. J. Risk Manage. Korea 12(1), 207–228 (2001)

    Google Scholar 

  • Diaz, J.T., Sanchez, J.H.P.: Analysis of financial risk in SMEs in the City of Armenia—new empirical evidence. J. Econ. Dev. Stud. 4(2), 75–86 (2016)

    Google Scholar 

  • Ehrhardt, M.C., Brigham, E.F.: Corporate Finance. A Focused Approach. South-Western, Mason (2011)

    Google Scholar 

  • Enterprise Risk Management—Integrated Framework. Committee of Sponsoring Organizations of the Treadway Commission (2004)

    Google Scholar 

  • Fabozzi, F.J., Peterson, P.P.: Financial Management & Analysis. Wiley, Hoboken (2003)

    Google Scholar 

  • Falkner, E.M., Hiebl, M.R.W.: Risk management in SMEs: a systematic review of available evidence. J. Risk Finan. 16(2), 122–144 (2015)

    Article  Google Scholar 

  • Gao, S.S., Sung, M.C., Zhang, J.: Risk management capability building in SMEs: a social capital perspective. Int. Small Bus. J. 31(6), 677–700 (2013)

    Article  Google Scholar 

  • Garanina, T., Petrova, O.: Liquidity, cash conversion cycle and financial performance: case of Russian companies. Investment Manage. Finan. Innov. 12(1), 90–100 (2015)

    Google Scholar 

  • Gaschi-Uciecha, A.: Badanie stopnia wdrożenia zarządzania ryzykiem w małych i średnich przedsiębiorstwach – wyniki badań. Zeszyty Naukowe Politechniki Śląskiej: Organizacja i Zarządzanie 89, 123–133 (2016)

    Google Scholar 

  • Gorczyńska, M., Wieczorek-Kosmala, M.: Analytical ratios, Katowice (2015), priv. comm

    Google Scholar 

  • Gordon, L.A., Loeb, M.P., Tseng, C.-Y.: Enterprise risk management and firm performance: a contingency perspective. J. Acc. Public Policy 28(4), 301–327 (2009)

    Article  Google Scholar 

  • Hoyt, R.E., Liebenberg, A.P.: The value of enterprise risk management. J. Risk Insur. 78(4), 795–822 (2011)

    Article  Google Scholar 

  • ISO 31000 Risk Management—A Practical Guide for SMEs. International Organization for Standardization, Switzerland (2018)

    Google Scholar 

  • Iyer, R., Khwaja, A.I., Luttmer, E.F.P., Shue, K.: Screening in new credit markets: can individual lenders infer borrower creditworthiness in peer-to-peer lending? In: NBER Working Paper Series, NBER Working Paper No. 15242, pp. 1–43. National Bureau of Economic Research, Cambridge, MA, USA (2009)

    Google Scholar 

  • Jastrząb, T., Wieczorek-Kosmala, M., Błach, J., Kwiatkowski, G.: eanaliza.pl—A new online service for financial analysis. In: Zgrzywa, A., Choroś, K., Siemiński, A. (eds.) Multimedia and Network Information Systems 2017, AISC, vol. 506, pp. 343–355. Springer, Cham (2017)

    Google Scholar 

  • Kościelniak, H.: Monitoring finansowy przedsiębiorstw w ujęciu sektorowym. Organizacja i Zarządzanie: kwartalnik naukowy 3(11), 43–55 (2010)

    Google Scholar 

  • Kozubíková, L., Belás, J., Bilan, Y., Bartoš, P.: Personal characteristics of entrepreneurs in the context of perception and management of business risk in the SME segment. Econ. Sociol. 8(1), 41–54 (2015)

    Article  Google Scholar 

  • Kumar, G., Upreti, M.: Liquidity and profitability tradeoff (a study of Idea Cellular Limited). In: Kumar, A., Agarval, S. (eds.) International Conference on Recent Innovation in Management, Engineering, Science and Technology 2018, pp. 150–156. A.R. Research Publication, India (2018)

    Google Scholar 

  • Lam, J.C.: Enterprise Risk Management, Enterprise Risk Solutions (2000)

    Google Scholar 

  • McShane, M.K., Nair, A., Rustambekov, E.: Does enterprise risk management increase firm value? J. Acc. Auditing Finan. 26, 641–658 (2011)

    Article  Google Scholar 

  • Megginson, W.L., Smart, S.B.: Introduction to Corporate Finance. South-Western, Mason (2006)

    Google Scholar 

  • Mejssner, B.: ERM—systemy na straży ryzyka. ComputerWorld (2018)

    Google Scholar 

  • Mikulska, A.: Rola ubezpieczeń w zarządzaniu ryzykiem na poziomie MSP. In: Prusak, B. (ed.) Przedsiębiorstwo w czasach kryzysu, pp. 57–68 (2012)

    Google Scholar 

  • Mikulska, A.: Zarządzanie ryzykiem jako czynnik sprzyjający wzrostowi MSP. Współczesne Zarządzanie: Kwartalnik Środowisk Naukowych i Liderów Biznesu 4, 75–83 (2010)

    Google Scholar 

  • Nocco, B.W., Stulz, R.M.: Enterprise risk management: theory and practice. J. Appl. Corp. Finan. 18(4), 8–20 (2006)

    Article  Google Scholar 

  • Nowak, E.: Problemy oceny sytuacji finansowej jednostek mikro. Prace Naukowe Uniwersytetu Ekonomicznego we Wrocławiu 471, 327–335 (2017)

    Article  Google Scholar 

  • Olson, D.L., Wu, D.D.: Enterprise Risk Management, 2nd ed. World Scientific Publishing Co. Pte. Ltd., Singapore (2015)

    Google Scholar 

  • Pinches, G.E., Eubank, A.A., Mingo, K.A., Caruthers, J.K.: The hierarchical classification of financial ratios. J. Bus. Res. 3(4), 295–310 (1975)

    Article  Google Scholar 

  • Quon, T.K., Zeghal, D., Maingot, M.: Enterprise risk management and firm performance. Proc.-Soc. Behav. Sci. 62, 263–267 (2012)

    Article  Google Scholar 

  • Richards, V.D., Laughlin, E.J.: A cash conversion cycle approach to liquidity analysis. Finan. Manage. 9(1), 32–38 (1980)

    Article  Google Scholar 

  • RiskTech100 2018 Report, Chartis Research Ltd. (2017)

    Google Scholar 

  • Smithson, C., Simkins, B.J.: Does risk management add value? A survey of the evidence. J. Appl. Corp. Finan. 17(3), 8–17 (2005)

    Article  Google Scholar 

  • Sojda, A.: Dźwignia finansowa a struktura kapitału przedsiębiorstw górniczych w Polsce. Zeszyty Naukowe Wyższej Szkoły Bankowej we Wrocławiu 15(5), 707–714 (2015)

    Google Scholar 

  • Spiżyk, J.: Zarządzanie ryzykiem w firmach z sektora MSP. Studia Ekonomiczne Regionu Łódzkiego 18, 73–87 (2015)

    Google Scholar 

  • Ustawa z dnia 29 września 1994 r. o rachunkowości. J. Law 1994 no. 121 pos. 591, Sejm RP, Poland (1994)

    Google Scholar 

  • Virglerová, Z., Kozubíková, L., Vojtovič, S.: Influence of selected factors on financial risk management in SMEs in the Czech Republic. Montenegrin J. Econ. 12(1), 21–36 (2016)

    Article  Google Scholar 

  • Wierzbicka, E.: Ryzyko małych i średnich przedsiębiorstw i możliwości jego ubezpieczenia. Zeszyty Naukowe PWSZ w Płocku: Nauki Ekonomiczne 22, 75–82 (2015)

    Google Scholar 

  • Worzała, W.: Wybór źródeł finansowania przedsiębiorstwa na przykładzie projektu inwestycyjnego. Organizacja i Zarządzanie: kwartalnik naukowy 2015(3), 149–166 (2015)

    Google Scholar 

  • Zygmunt, J.: Does liquidity impact on profitability? In: Matiaško, K., Lieskovský, A., Mokryš, M. (eds.) 2nd International Conference of Informatics and Management Sciences 2013, pp. 247–251. EDIS–Publishing Institution of the University of Zilina, Slovakia (2013)

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Silesian University of Technology, Akademicka 16, 44-100, Gliwice, Poland

    Tomasz Jastrząb

  2. Technicenter Sp. z o.o., Tatrzańska 2, 41-907, Bytom, Poland

    Artur Łopata

Authors
  1. Tomasz Jastrząb
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Artur Łopata
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Tomasz Jastrząb .

Editor information

Editors and Affiliations

  1. The York Management School, The University of York, York, UK

    Philip Linsley

  2. Newcastle Business School, Faculty of Business and Law, Northumbria University, Newcastle upon Tyne, UK

    Philip Shrives

  3. Faculty of Finance and Insurance, University of Economics in Katowice, Katowice, Poland

    Monika Wieczorek-Kosmala

Rights and permissions

Reprints and permissions

Copyright information

© 2019 Springer Nature Switzerland AG

About this paper

Check for updates. Verify currency and authenticity via CrossMark

Cite this paper

Jastrząb, T., Łopata, A. (2019). Small & Medium-Sized Enterprise Risk Monitoring Based on Financial Analysis Results. In: Linsley, P., Shrives, P., Wieczorek-Kosmala, M. (eds) Multiple Perspectives in Risk and Risk Management. Springer Proceedings in Business and Economics. Springer, Cham. https://doi.org/10.1007/978-3-030-16045-6_8

Download citation

Publish with us

Policies and ethics

Search

Navigation