The content of the object, subject and tasks of economic analysis
Questions: The content of economic analysis. Object, subject and objectives of economic analysis. Objectives and users of economic analysis. Economic analysis and related sciences.
Contents of Economic Analysis
The content of economic analysis depends on the socio-economic structure of society, ownership, governance, economic policy, the existing system of accounting and reporting and other conditions. The main purpose of the economic analysis is to prepare information to make better management decisions and oobosnovaniya current and future plans aimed at achieving short-term and strategic goals of the company. Realization of this goal requires an assessment of the situation, diagnose and predict its development and finding ways to achieve the desired results in the most efficient manner. Accordingly, there are three functions of analysis: evaluation, diagnostic and search. The evaluation function is to determine the compliance state of the economy of the enterprise and its target parameters potential. Diagnostic - study the causes of deviations from the target parameters and predict the further development of the situation. Search - to identify potential opportunities to achieve their goals.
Economic analysis as a science is a system of specialized knowledge related to the study of trends of economic development, scientific substantiation of plans of management decisions, monitoring their implementation, measuring the impact of factors, evaluation of progress, search, and measurement and determining the value of economic reserves of increase of efficiency of production and development measures for their use.
Object, subject and objectives of the economic analysis
Each science has its own object of research. It is believed that if there is an object of research, there is no science. Object- is something that is directed cognitive activity. The object of economic analysis are the results of operations that appear to the system of interrelated indicators reflecting some of its sides and segments. For example, the objects of analysis include the production and sale of products, its cost, the use of material, labor and financial resources, the financial results of operations, financial condition of the company. Subject Economic Analysis - the causal relationships of economic phenomena and processes, knowledge of which allows a comprehensive study of the results of their sensitivity to the effects of management for the preparation of the information to make better management decisions aimed at improving the functioning of the company and strengthening its market position.
The tasks of economic analysis:
- The study of the status and trends of economic development of the enterprise;
- Forecasting performance based on current trends of development and expected changes in the future;
- Scientific substantiation of current and future plans;
- Monitor the implementation of plans and management solutions for the effective utilization of the economic potential of the company in order to identify weaknesses, errors and operational impact on economic processes;
- The study of the influence of objective and subjective, internal and external factors on the operating results, which allows to objectively evaluate the work of the enterprise, to make the correct diagnosis of his condition and prognosis of the future, identify the main ways to increase its efficiency;
- Search for reserves to improve production efficiency based on the study of excellence and achievements in science and practice;
- Evaluation of the results of the company to achieve its goals - the implementation of plans, the level of productivity and business efficiency, the use of existing capacity, position on the market for goods and services;
- Assessment of financial and operational risks and the development of internal controls in order to strengthen the market position of the company and improve profitability;
- Justification of actions to address identified deficiencies and development of reserves to enhance the functioning of the enterprise in order to increase its competitive advantage.
Objectives and users of the economic analysis
The purpose of economic analysis - Preparation of information to make better management decisions and oobosnovaniya current and future plans aimed at achieving short-term and strategic goals of the company.
Members of the economic analysis of information, depending on their interests to information, can be divided into two groups: internal and external.
Internal users - this organization management personnel, accountants and economists enterprise. They tend to be involved in the analysis, are able to exercise control over the conduct of the analysis may receive in accordance with the functions of management, any information relating to the current activities and prospects of the company. For internal users, the results of the analysis are the necessary basis for management decisions. For example, the company's managers use the results of the analysis for the formation of marketing, pricing, determining the sufficiency of funds for financing activities, determine the need for additional sources of financing. Accordingly, the personnel of the company uses the information to determine whether the enterprise and improve the timely payment of wages, to solve social problems.
External users - these government regulators, creditors, external auditors. They use information from official sources, internal users (financial and statistical reporting). They use the results of the analysis for different tasks. For example, the IRS conducts an analysis of financial and economic activity of the enterprise in order to verify compliance with the requirements of the legislation in the areas of their competence. They check the validity of the formation costs, financial performance; determine the completeness of tax payment. Evaluate the capabilities of the company to meet their obligations to the state, suppliers. Banks use the information to determine the level of creditworthiness of the company, sufficient funds to finance ongoing operations, to determine the market value of the enterprise, which can serve as collateral for a loan. Counterparties, which include suppliers, contractors and partners in joint activities, use the information to determine the real situation of the company in the market, its solvency is not threatened if he bankruptcy, the prospects for further cooperation with the company.
Economic analysis and related sciences
Economic analysis is closely associated with a number of disciplines. First of all, it is associated with economic theory, which is studying the laws, their mechanism of action, creates a theoretical basis for the development of all economic disciplines. When conducting analytical studies should take into account the effect of these laws.
Relationship with industry economies reflected in the fact that not knowing the sector of the economy and organization of production can not be an in-depth analysis of the company. The results of the economic analysis used to improve the organization of production, the introduction of scientific management, excellence.
The analysis contributes to the economic recovery of specific companies and the industry as a whole.
Communication planning and management reflected in the fact that without the extensive use of the results of the analysis can not be scientifically based planning, forecasting and management of the enterprise and the national economy as a whole. Analysis provides information basis for the development of business plans, plans, forecasts and selecting the most optimal management decisions.
Communication with accounting reflected in the fact that not knowing the methods of accounting and reporting content, it is very difficult to find the necessary materials to analyze and verify their goodness. To provide an analysis of qualitative information, to make it more efficient and truthful, the whole accounting system is constantly being improved: periodically revised form and content of the accounting records, source documents, the order document, the contents of internal and external reporting.
Communication with the audit reflected in the fact that during the audit are widely used analytical procedures in order to prove the reliability of accounting and reporting and diagnostics company's financial condition. The analysis is an integral part of the internal and external audit and a type of audit services. Communication with mathematics and new computer technologies is reflected in the fact that in the analysis are widely used mathematical methods and new computer technology, thanks to its analysis has become deeper and more complex, can be carried out more quickly, cover more of the objects to learn much more information.
Thus, for a qualified analysis of the company requires a deep knowledge of the macro- and micro-economics, management, marketing, accounting, statistics, technology, production, computer science and many other sciences.
Questions for self-control
1. What is meant by the economic analysis?
2. What is the main content and purpose of the economic analysis?
3. What is the subject and the object of economic analysis?
4. What are the main tasks of economic analysis?
5. In what ways communication analysis with other sciences?
6. What are the internal and external users of the economic analysis?
7. What is the role of economic analysis in business management?