AN ASSESSMENT OF FINANCIAL LIQUIDITY OF POLISH PRESSURE ALUMINUM CASTING HOUSES

1 ZIMON Grzegorz
Institution:
1 Rzeszow University of Technology, Rzeszow, Poland, EU, gzimon@prz.edu.pl
Conference:
27th International Conference on Metallurgy and Materials, Hotel Voronez I, Brno, Czech Republic, EU, May 23rd - 25th 2018
Proceedings:
Proceedings 27th International Conference on Metallurgy and Materials
Pages:
2128-2133
ISBN:
978-80-87294-84-0
ISSN:
2694-9296
Published:
24th October 2018
Proceedings of the conference were published in Web of Science and Scopus.
Metrics:
641 views / 226 downloads
Abstract

For each company a loss of capacity to settle current liabilities means an emergence of a number of difficulties that may cause bankruptcy. In commercial companies, where current assests are a large share in assets, one can try to regain financial liquidity by gradually liquidating individual current assets. The manufacturing companies deal with payment bottlenecks in a more difficult way. In such companies fixed assets account for a significant share in the structure of assets. Fixed assets are the ones that are difficult to liquidate. In a situation when payment bottlenecks appear, manufacturing companies have a problem with regaining financial liquidity. If such transactions take place when a company has to sell fixed assets quickly, it usually suffers from a large loss in sales. In general, fixed assets that the company gets rid of belong to specific instruments that may not be in demand at certain moment. Therefore, the price of such instruments must be attractive for a buyer. This is the last resort to save a company. The company regains its financial liquidity, but the sales at a loss reduces financial results. To prevent this, it is necessary to analyze systematically the basic financial liquidity ratios assessing the risk of inability to settle current liabilities. In the article advantages and disadvantages of the applied financial liquidity management strategies were presented. The aim of the paperis to determine an optimal liquidity management strategy for pressure foundries. The  presented analysis and the model of the optimal strategy may be used in the selection of liquidity strategies in manufacturing companies from various industries in the country or in the world. The research period covered the years 2014-2016.

Keywords: financial liquidity, aluminum pressure castings

© This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

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