APPROACHES TO ASSESSING THE MINIMUM SUFFICIENT LEVEL OF FINANCIAL INDEPENDENCE OF THE ORGANIZATION

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APPROACHES TO ASSESSING THE MINIMUM SUFFICIENT LEVEL OF FINANCIAL INDEPENDENCE OF THE ORGANIZATION Vahe Mikayelyan

The coefficient of financial independence is an important indicator characterizing the level of financial stability of the organization. It reflects the level of use of own funds by the company to carry out its activities. This indicator is also an important analytical tool for investors, creditors and management personnel, as it helps to assess the level of risk associated with the company's financial policies and its ability to ensure financial stability in the long term. The article proposes a new approach to assessing the minimum necessary amount of equity capital for the organization and the sufficient (smallest) level of the coefficient of financial independence based on it.

DOI: 10.59503/29538009-2024.2.14-81 Cross- Cultural Studies: Education and Science Vol. 2 No. 14 (2024): 2024-2 81-92

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Keywords

financial stability, financial independence, equity capital concentration ratio, financial independence ratio, minimum required equity capital, financial independence reserve

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