Importance of objective and formal adequacy for the indicators of enterprise financial health
F. Střeleček, R. Zdeněkhttps://doi.org/10.17221/5246-AGRICECONCitation:Střeleček F., Zdeněk R. (2004): Importance of objective and formal adequacy for the indicators of enterprise financial health. Agric. Econ. – Czech, 50: 543-551.
The evaluation of financial health of an enterprise becomes very important in Czech businesses. Among other factors, it is so because it is viewed as a precondition for being eligible for some of the EU structural funds. Models of enterprise financial health were created mainly on the basis of objective evaluation of indicators and discrimination analysis for prosperous and bankrupting enterprises. Little attention was paid to the influence of particular indicators on the total value of enterprise financial health. Using the principles of objective and formal adequacy of the indicators, as well as their standardisation, and the methods of multicriterial evaluation together with the determination of particular indicators independence can improve the creation of financial health indicators and facilitate a higher rate of its objectiveness.Keywords:
financial health of an enterprise, methods of multicriterial evaluation, cluster analysis