Analyzing the Impact of Financial Architecture on the Efficiency of Financial Activities of Corporation

• Main Author: Nemsadze Guram G.
• Format: Article
• Language: English
• Published: Research Centre of Industrial Problems of Development of NAS of Ukraine 2020-07-01
• Series: Bìznes Inform
• Subjects: financial architecture; corporation; financial activity; corporate governance; efficiency; profitability
• Online Access: https://www.business-inform.net/export_pdf/business-inform-2020-7_0-pages-208_214.pdf

The article is aimed at analyzing the impact of financial architecture on the efficiency of activities of corporation in unstable economic environment. The efficiency of financial activity is characterized as the degree of achieving financial goals of the corporation in the process of developing and implementing financial solutions. Components of the corporation’s efficiency are examined and the indicators of operational efficiency of the corporation are analyzed, in particular profitability of assets, profitability of sales and profitability of equity. It is noted that the financial activity of the corporation depends on the peculiarities of its financial architecture, which is a set of interrelated components – structural characteristics of the corporation defining the structure of the corporation’s finance. Financial architecture is one of the key factors in the market capital value of the corporation and the efficiency of its activities as a whole. Such impact on the value of business is carried out both from the position of money flows generated by the corporation and from the position of its capital value. The necessity of researching the components of financial architecture of corporation is substantiated, which are: ownership structure, capital structure, corporate management and organizational-legal form of economic management, in order to achieve its effective activity and to ensure financial security in conditions of transformational changes in the economy of the country. Further development of the corporation’s financial architecture, which is a dynamic system that adapts to changes in unstable economic environment, can lead to better competitiveness and efficiency of financial activities and will contribute to a successful operation in the future.