Improving the methodology for assessing the economic efficiency of economic entities during a pandemic

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Hacıyeva A.

70th International Scientific Conference on Economic and Social Development, Baku 2021, Baku, Azerbaijan, 25 - 26 June 2021, vol.1, no.1, pp.915-924, (Full Text)

Qısa məlumat

The main purpose of this study is to investigate the impact of the global coronavirus pandemic on companies’ financial statements since the beginning of 2020. Especially the probability of “continuity of operations” used in International Financial Reporting Standards, recognition of income, valuation of inventories, determination of fair value, impairment of goodwill, etc. such as issues are discussed and recommendations are made to reduce the risks.

Problem and subproblem. According to the article, because of the ongoing uncertainty due to the pandemic, to maintain the quality of financial statements, the effects that are expected and likely to occur due to the application of skepticism should be detailed in the financial statements.

Methodology. This study conducted a regression analysis of gross profit using linear multiplicity and nonlinear multiplicative econometric modeling methods to assess the relationship between gross profit of the organization, cash flows, current assets, current liabilities, private capital, and debt capital. As a result of the research, it was found that “Azersu” OJSC (The organization in charge of state policy and strategy in the field of water supply, drinking water supply and sanitation services to consumers in a centralized manner) has a negative linear relationship between cash flows, current assets and total capital and total profit, as well as between current liabilities and total profit, a positive linear relationship.

Practical significance of this study. This article can play a positive role in enriching the scientific and practical knowledge of experts involved in accounting and auditing. To avoid these research limitations, more practical information and reporting indicators are required.

Scientific novelty and originality of the study. The need for econometric modeling, based on the regression equation of dependencies, the audit of the audited entity’s financial statements and its improvement.