The Use of Multivariate Comparative Analysis to Assess the Financial Condition of a Company

Abstract:

Many methodological problems are associated with measuring and assessment of the company's financial standing. Various methods have been developed to assess the current and future financial standing of enterprises. Their usefulness requires development and verification based on the example of a specific enterprise. The evaluation of one of these methods is the subject of this article. The major research objective of the study is to propose a synthetic method of assessing the condition of a company and verify its correctness based on data referring to a deliberately selected listed company.

This article shows that a synthetic measure constructed on the basis of selected financial indicators allows for a comprehensive assessment of the company’s financial condition in dynamic terms. The constructed synthetic measure can also be used for a comparative analysis of the financial condition of companies over a given period of time.