Examination of Two Companies’ Liability Management

Abstract

Companies need capital to establish, to start their activities, to continue their processes and to expand. Firms use their money that is available to invest in instruments which are necessary for their activities (intangible assets, tangible assets and non-material assets). We can distinguish fixed and current assets that depend on the invested capital, which can be a shorter or a longer period.

Companies have to make a lot of decisions on how to run their working process regarding financial and innovative questions. We would like to deal with financial decisions from these. It is a well-known fact that the financial decisions always bring major changes in assets and liabilities in long and short term as well.

From these decisions and financial principles, we can determine the enterprises’ asset or liability willingness. The company’s asset policy can be determined by the help of many indicators which take into account the company’s asset structure and debtors and creditors.

Lector’s Opinion

For the study titled

Examination of two Hungarian companies’ liability management

The study provides short, brief inside view of the financing elements and forms that establish the financial decisions of the enterprises, it outlines the possible forms of financing strategy in order to the enterprises’ evaluation in relation to the value measuring indices be plain and well-grounded. In the completed analyses the authors present the most important indices that help the enterprises’ managers to judge their stock of means and resources through two enterprises but embracing 11 years. The completed comparative analysis presents the different ways of financing of the two enterprises very well, from which the conclusions concerning the connections revealed by the authors can be drawn. The case examples highlight the possible uses of the equity capital in the financial decisions as a result of the outlined system of aspects. In the life of the small- and medium-sized enterprises periodical reconciliation of the supplier’s and customer’s stock is very important in order to be able to balance the cash-flow stably. This correlation is definitely a determinant in the competitiveness of the enterprises, since the series of the financing and other financial decisions and the priority of the decisions can increase the enterprise’s effectiveness and possibilities of value creation to a great extent.

Gödöllő, 9th June 2016.

Dr. Zoltán Zéman

Associate professor

Szent István University

Institute of Business Sciences