Essence and classification of financial risks and their assessment methods

Nabiyev Mahayad Anwar oglu
Dissertation, University of Azerbaijan (Republic of Azerbaijan). E-mail:matlabm@yandex.ru

Cite this article:

Nabiyev M., (2018) Essence and classification of financial risks and their assessment methods. Ed.: М.D. Baldzhy (ed.-in-ch.) and others [Systema pensiinoho zabezpechennia Ukrainy ta yevrointehratsiini protsesy; za red.: М. D. Baldzhy (gol. red.)], Scientific Bulletin of the Odessa National Economic University (ISSN 2313-4569), Odessa National Economics University, Odessa, No. 9(261), pp. 116-129.

Abstract

The article is devoted to some issues of the study of financial risk, which ensures the security of any commercial firm, its elements, operations and transactions. It is noted that these measures are aimed at preventing events that threaten the company, property, infrastructure, reducing their likelihood and minimize the adverse effects. The author, underlining the similar behavior of firms, notes that financial risks are an integral part of their business for them. Also, the author emphasizes that the risk of loss of solvency of the firm is characterized by a violation of the balance between the movement of positive and negative cash flows of the firm as a result of reducing the level of liquidity of current assets. Attention is drawn to the fact that, according to financial results, the risk of loss of solvency is one of the most dangerous situations for the firm. Thus, the author states that solvency characterizes the current state of assets, liabilities, liabilities, income, expenses and accounts of the firm. Evaluating the solvency of the company, the author draws attention to the fact that the determination of the constant factors and analysis of the current and future financial situation both in the economy and in the company should predict solvency, conducted on the analysis of processes that occur with an orientation to the future. The author, analyzing the solvency of the company, tried to characterize the ability to fulfill current monetary obligations to creditors from the moment the commencement and execution of obligations for payment of obligatory payments took place within one month. In this case, the emphasis is on some aspects of investment risk. Since all types of investment risks are related to the possibility of a company's loss of capital, it is proved that they are among the most vulnerable group of financial risks. It is noted that this type of risk usually characterizes the likelihood of financial losses in the process of investing the company, according to the types of their investment activity. Emphasizes the existence of two types of investment risk - the risk of real investment and the risk of financial investment. Attention is drawn to the fact that for the effective operation of the firm, the manager must timely identify and assess the risks, as well as take effective measures to minimize them.

Keywords

financial risks, types of financial risks, analysis of financial risks, methods of assessing of financial risks, investment risks, minimization.

JEL classification: C130; D810

UD classification: 338.22

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