SHS Web Conf.
Volume 129, 2021The 21st International Scientific Conference Globalization and its Socio-Economic Consequences 2021
|Number of page(s)||8|
|Section||Financial Management and Financial Markets|
|Published online||16 December 2021|
National and Foreign-controlled Companies Operating in Development Activities in Czechia and Aspects of their Capital Structure Management
1 University of Technology, Faculty of Business and Management, Kolejní 2906/4, 612 00 Brno, Czechia
2 University of Technology, Faculty of Business and Management, Kolejní 2906/4, 612 00 Brno, Czechia
* Corresponding author: email@example.com
Research background: Entities operating in the field of development activities show significant specifics, including a high level of indebtedness. Given the nature of development projects, which are long-term, and their financial complexity, companies take, at the same time, high risks. Therefore, there is need of a high standard of financial management and risk management in this type of companies.
Purpose of the article: The aim of the paper was to provide information regarding return on equity and point out the risk factors of financial management. A partial aim of the conducted preliminary research was to identify and evaluate selected differences in financial management of national companies and foreign-controlled companies.
Methods: The research was conducted as mixed research. It started with the undertaking of qualitative research focused on textual analysis of the text and collection of selected relevant quantitative data. For evaluation, we used INFA methodology, which links financial controlling and risk controlling indicators. The data under investigation were those related to the evaluation of return on equity in relation to risks taken. The indicators of the assets, self-financing ratio and debt ratio were assessed, including the assessment of the impact of these factors on return on equity and taken risks.
Findings & Value added: The research provides new knowledge regarding the extent to which equity capital is used in the financial management of companies operating in the Czech Republic in development activities. The results indiciate that companies under foreign control and domestic companies show differences in financial structure and financial stability indicators, as well as in the effectiveness of using their capital.
Key words: capital structure; / equity; / intra-group transactions; / debt ratio
© The Authors, published by EDP Sciences, 2021
This is an Open Access article distributed under the terms of the Creative Commons Attribution License 4.0, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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