Grechenyuk A.V.Kursk Academy of Public and Municipal Services, Kursk, Russian Federation grant25@yandex.ru
Grechenyuk O.N.Southwest State University, Kursk, Russian Federation og1016s@yandex.ru
Importance The current development trends in the economy and business have led to changes in composition and structure of assets, capital, revenues and expenses of some Russian companies. Hence, certain indicators of financial analysis have become irrelevant, as they provide incorrect results, especially when comparing different companies. Objectives The aim of the research is to develop proposals to eliminate shortcomings of certain indicators of turnover and profitability due to changed trends in the formation of assets, capital, income and expenses of Russian companies. Methods The study rests on the analysis of financial statements of 1,000 Russian joint stock companies for 2010–2013. To process and analyze the database, we applied MS EXCEL tools. Results The findings show that efficiency of operations depends significantly on long-term and short-term financial investments, as well as revenues and expenses from their use. Therefore, the asset turnover ratio, return on sales, and return on costs cannot be used in their classic form for financial analysis, and require updating. To eliminate the shortcomings of these indicators, we propose two indicators of turnover and two indicators of profitability, and test them on financial statements produced by 1,000 Russian companies. Conclusions The test results demonstrate practical significance of the proposed indicators for assessing the real level of efficiency. The calculation process enabled to prove very low utilization efficiency of long-term and short-term investments of public companies. This affects the total level of turnover and profitability, which is lower than that of nonpublic entities.
Keywords: turnover, profitability, financial condition, joint stock company
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