Determining the needs of the enterprise in its own working capital ah is carried out in the process of rationing, that is, determining the standard of working capital.
The purpose of rationing is to determine the rational amount of working capital diverted to certain period into the sphere of production and circulation.
The need for own working capital for each enterprise is determined when drawing up a financial plan. Thus, the value of the standard is not a constant value. The amount of working capital depends on the volume of production, conditions of supply and marketing, the range of products, the forms of payment used.
The working capital rate is nothing more than the number of days during which working capital is diverted into inventories, starting from the payment of an invoice for materials and ending with the moment they are transferred to production. It includes:
- transport stock, which is defined as the difference between the time of cargo turnover and the time of document circulation. (Document flow - the time for sending settlement documents and submitting them to the bank, the time for processing documents in the bank, the time for the postal run of documents.) In practice, its value is determined on the basis of actual data for the previous year;
- preparation stock - time for unloading, acceptance and warehouse processing received materials is determined upon the fact;
- Technological margin - time to prepare materials for production . This applies to those materials that cannot immediately go into production (wood - drying, grain - processing, etc.);
- current stock . It is needed to ensure the continuity of the production process between two related supplies materials;
- · Guaranteed (insurance) stock required in case of unforeseen circumstances. It is set, as a rule, in the amount of 50% of the current stock.
Thus, general norm stock in days for raw materials, basic materials and purchased semi-finished products as a whole consists of the five listed stocks.
To determine the standard, the average daily consumption of normalized elements in monetary terms is taken into account. For inventories, the average daily consumption is calculated according to the corresponding article of the estimate of production costs: for work in progress - based on the cost of gross or marketable output; for finished products - based on production cost commodity products.
In the process of rationing, private and aggregate standards are established. The normalization process consists of several successive stages:
Initially, stock standards are developed for each element of normalized working capital. Norma is relative value, corresponding to the volume of the stock of each element of working capital. As a rule, the norms are set in days of supply and mean the duration of the period provided by this species. material assets. The stock rate can be set as a percentage, in monetary terms to a certain base.
The norms of working capital are developed at the enterprise by the financial service with the participation of services related to production and supply and marketing activities.
Further, based on the rate of stock and consumption of this type of inventory, the amount of working capital necessary to create normalized reserves for each type of working capital is determined. This is how private standards are defined.
And, finally, the total standard is calculated by adding the private standards. The working capital ratio is monetary value the planned stock of inventory items, the minimum required for the normal economic activity of the enterprise.
The standard of working capital advanced in raw materials, basic materials and purchased semi-finished products is determined by the formula:
H \u003d Npz * Cpz, where
H - the standard of working capital in stocks of raw materials, basic materials and purchased semi-finished products;
C pz - average daily consumption of raw materials, materials and purchased semi-finished products;
N pz - stock rate in days.
The average daily consumption for the range of consumed raw materials, basic materials and purchased semi-finished products is calculated by dividing the sum of their costs for the corresponding quarter by the number of days in the quarter.
Determining the stock rate is the most time-consuming and main part rationing. The stock rate is set for each type or group of materials. If many types of raw materials and materials are used, then the norm is set for the main types, which occupy at least 70-80% of the total cost.
Working capital ratio in work in progress should ensure a rhythmic production process and a uniform flow of finished products to the warehouse. The standard expresses the cost of products that have been started, but not finished, at various stages of the production process. As a result of normalization, the value of the minimum reserve sufficient for the normal operation of production should be calculated.
Rationing of working capital in work in progress is carried out by groups or types of products for each unit separately. If the range of products is diverse, then the standard is calculated for the main products, which make up 70-80% of its total mass.
The standard of working capital in work in progress is determined by the formula:
H=Hnp*Svp, where
Svp - one-day costs for the production of gross output;
Nnp - the rate of working capital for work in progress,
Hnp \u003d Pts * Kn
Pts - the duration of the production cycle in days;
Kn - coefficient of increase in costs.
One-day costs are determined by dividing the cost of the gross (commodity) output of the corresponding quarter by 90.
Norm for the item "Expenses of future periods" are calculated according to the formula:
N=Rng+Rpl-Rsp, where
Rng - the amount of expenses for future periods at the beginning of the planning period;
Rpl - expenses incurred in the planned year;
Rsp - expenses included in the cost of production of the planned period.
Working capital ratio for finished products is determined by the formula:
H=Ngp*Wtp, where
Wtp - one-day output of marketable products
Ngp - the norm of working capital for finished products.
Thus, private standards are established for each element of the normalized working capital. Then, the total standard of working capital is determined, reflecting the general need of the enterprise for its own working capital in the planning period, by adding private standards.
Next, you need to compare the resulting total standard with the total standard of the previous period in order to determine how the company's need for its own working capital changes in the planning period.
The difference between the standards is the amount of increase or decrease in the standard of working capital, which is reflected in financial plan enterprises.
Normalized working capital are own working capital advanced into working capital production assets and in separate elements of circulation funds (raw materials, materials, work in progress, deferred expenses, etc.) Non-standardized working capital- goods shipped cash, receivables.
Methods for planning the need for working capital:
- - Analytical Method(experimental-statistical) involves an enlarged calculation of working capital in the amount of their average actual balances.
- - Ratio method - is based on the definition of a new standard based on the existing one, taking into account amendments for changes in the volume of production.
- - Direct counting method is the most accurate, but also the most time consuming. It is based on the definition of science-based stock standards for individual elements of working capital and the standard of working capital.
Methods for calculating the norms of working capital.
Working capital ratio is the minimum amount of money required to economic activity enterprises. The algorithm for calculating the standard for individual elements of working capital is as follows: stock rate (days) * one-day consumption or release for this element of working capital. In its turn one-day expense is calculated as the quotient of dividing the cost by the number of days in the period.
There are three methods for calculating the norms of working capital: analytical, direct counting method, coefficient method.
Analytical, or the experimental-statistical method of rationing reflects the established practice of organizing production, supply and marketing. Its essence lies in the fact that when analyzing the available inventory items, their actual stocks are corrected and excessive and unnecessary values are excluded.
Direct Count Method provides for a scientifically based calculation of reserves for each element of working capital in the conditions of the achieved organizational and technical level of enterprises, taking into account all the changes taking place in the development of technology and technology, in the organization of production, transportation of inventory items in the field of settlements.
At coefficient calculation the free norm of the previous period is amended for the planned change in the volume of production and for the acceleration of the turnover of funds. The use of differentiated coefficients for individual elements of working capital is permissible if the standards are periodically updated by direct calculation.
To determine the need to calculate your own working capital for an enterprise, it is worth considering some points. For example, these funds should cover not only the main processes in order to fulfill the production program, but also the needs of housing and communal services, auxiliary, subsidiary and other farms that are not related to the company's activities and do not have an independent balance, as well as for the implementation overhaul on their own. However, in practice, the need for own working capital is most often determined only for the main activity, which somewhat reduces its need.
Own volume working capital is calculated depending on the following factors:
Applied settlement form;
- ;
- terms of sale and provision of supply and sale;
- range of manufactured goods.
Rationing of working capital is expressed in money. To determine the need, they include an estimate of the costs of manufacturing services and goods for a certain period. At the same time, it is advisable for companies that have a non-seasonal nature of production to use the data of the fourth quarter, because during this period, as a rule, production volumes are slightly higher.
Businesses with seasonal production are better off using quarterly data with the least volume. This is due to the fact that the seasonal need for additional working capital can be met through short-term bank loans.
In order to correctly determine the standard, it is necessary to calculate the average daily costs of normalized elements in financial terms. The average daily consumption of production reserves is calculated by means of the corresponding item of the cost estimate. Work in progress is calculated depending on the cost of gross output, finished products - on the basis of the cost of commercial products.
During the rationing period, aggregate and private standards are formed. The whole process contains several sequential steps.
To begin with, it is necessary to determine the reserve rate for each element of the normalized capital. These norms are usually set in spare days and determine the length of the period that will be provided by this type of funds. The reserve norm can be set as a percentage or monetary equivalent to a certain base.
Further, it is necessary to calculate the amount of working capital, guided by the data of the reserve norm and the total costs of inventory items of this type, which is needed to create a normalized stock for each individual type of working capital. This is how private standards are formed. These include the following standards for working capital of reserve production:
raw material;
- accessories;
- basic and additional materials;
- purchased semi-finished product;
- container;
- fuel;
- IBP (low-value and wearing items).
At the end of all calculations, all private standards are summed up, and the total standard is calculated.
These principles are expressed in the following points:
Consistency;
- scientific validity;
- planning;
- progressiveness.
Consistency is expressed in the relationship of material standards and the system of technical standards used. Material norms are taken as the basis of technological standards (daily expenditure of funds, the duration of one production cycle, etc.) and through established norms stimulate the improvement of the technological process.
The principle of scientific validity is that the working capital rationing process is based on the latest methods production organization labor and is a means responsible for the implementation of their own reserves.
Planning is determined by the fact that any company must carry out capital rationing in accordance with existing forecasts and orders for the sale of products, as well as planned cost estimates, investment and innovation plans, and so on.
The principle of progressiveness is determined during the period of creating an event to increase the turnover of funds by reducing material costs and labor costs, accelerated turnover of documentation, increasing the level of organization of material and technical equipment, sales of goods, and so on.
Methods for normalizing a current asset
As a rule, enterprises use such methods of normalization of working capital as:
1) analytical;
2) direct account;
3) coefficient.
The analytical method is used in cases where the planned period does not provide for any significant changes in comparison with the previous ones. In this case, the normative calculation is made on an aggregate basis, taking into account the ratio of the amount of working capital for the past periods and the growth rate of production volumes. During the analysis of the current working capital, its actual reserves should be adjusted, and all unnecessary ones should be excluded.
The method of direct account is to calculate the reserves of each element of working capital. At the same time, all changes in the organizational and technological development of production, as well as the transportation of materials and settlement practices between companies, should be taken into account. This method is quite laborious, requiring the highest level of qualification of economists and the involvement of many different services of the company (production and economic departments, supply, accounting). However, it is this technique that makes it possible to calculate the company's need for working capital as accurately as possible.
The coefficient method allows you to determine a new standard based on the standard of the previous period by including in it various changes. It takes into account the conditions of equipment, production, sales of products, calculations.
There are companies operating for more than one year, which most often use the coefficient and analytical methods. They form the production program and organize the production process, but do not have the necessary number of economists who are highly qualified enough to analyze the work in the field of working capital calculation in more detail.
However, in practice, the most commonly used method is the direct counting method. Its main advantage is that the data obtained are the most reliable, since the most accurate calculation of aggregate and private standards is made.
As noted above, the normalization of working capital is carried out by calculating working capital.
The working capital ratio for a certain period is calculated by the method of analytics or direct account and is divided into private (the amount of funds by elements) and aggregate (the sum of all working capital) standards.
Using the direct account method, the standard is calculated as a set of working capital in the form of the sums of each of the elements based on existing orders, reserve and expenditure rates, innovative and investment plans, and planned cost estimates. For calculations, the formula is used:
Woc = ∑Wn
where Woc is the total standard of the fixed capital element; n is the standard of the fixed capital element.
The main advantage of this method is that the total standard is defined as the sum of individual elements. The importance of the analytical method lies in the fact that it is focused on the main regulatory level and an enlarged calculation of the need for resources based on the planning of the normalized period. The following formula applies here:
Woc = In * Woc
where In is the index of change in the volume of manufactured products or material resources used; boss - the main normative level.
Thus, the index of change in the volume of manufactured products or material resources used is calculated using the following formula:
In = Mpl/Mfact
In = Vpl / Vactual
where Vpl - the estimated amount of manufactured products; Vfact - the actual production of products; Mpl - estimated expenditure of funds; Mfact - the actual expenditure of funds.
The advantage of this method is that it is quite simply calculated, but it has a drawback in the form of transferred omissions and shortcomings, which are always present during the determination of the standard in the base period. This method is mainly used for prospective calculations of the need for financial support.
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From the point of view of production efficiency, the volume of working capital should be optimal, i.e. sufficient to ensure an uninterrupted production process, but at the same time minimal, not leading to the formation of excess stocks, freezing funds, increasing production costs and product sales. The need to form working capital in the optimal amount is due to the fact that there is a time lag between the time of consumption of material resources in production and the receipt of sales proceeds, depending on a variety of internal and external factors. The amount of working capital sufficient for the normal functioning of the process of production and sale of products is established by rationing working capital, which is the basis for their rational use.
Rationing of working capital- this is the process of determining the minimum, but sufficient for the normal "flow of the production process, the amount of working capital in the enterprise.
In a market economy, the value of working capital rationing is very high: enterprises must independently establish and control the working capital standard, since in the end, the efficiency of the enterprise and its financial position (solvency, stability, liquidity) depend on it. Understating the amount of working capital entails an unstable financial situation, interruptions in the production process and, as a result, a decrease in production volume and profitability. On the contrary, an overestimation of the size of working capital freezes funds in any form (warehouse stocks, suspended production, excess raw materials and materials), thereby preventing investments in the expansion and renewal of production.
In the practice of intra-production planning, enterprises use the following methods of normalizing working capital.
Analytical Method involves the calculation of the need for working capital in the amount of their actual average balances, taking into account the growth in production in the planning period. A detailed analysis of the effectiveness of the use of working capital in the base period is preliminary carried out, factors and reserves for accelerating their turnover are identified. It is used at enterprises, in the structure of working capital of which a large share is occupied by inventories.
Ratio method is based on dividing the elements of working capital into two groups depending on the change in the volume of production. The current assets included in the first group depend on the volume of production. The calculation of the need for them is carried out by the analytical method based on their size in the past period and the expected growth in production volume (raw materials, materials, finished products, work in progress). The second group includes deferred expenses, spare parts, low-value and wearing items, i.e. all types of working capital, the value of which does not depend on changes in the volume of production. Rationing of working capital of the second group is made on the basis of actual average balances for the previous period.
Direct Count Method consists in calculating the need for normalized working capital for each of their elements. The advantage of this method lies mainly in the fact that it allows you to accurately determine the need for working capital. However, it is quite laborious, requires highly qualified economists, and is mainly used with a narrow range of material resources. The method is used to clarify the need for working capital operating enterprise or when organizing a new enterprise, when there are still neither statistical data, nor rhythmically operating production, nor a formed production program.
Direct Count Method requires the determination of stock standards and average daily consumption for certain types working capital. When normalizing working capital, it is necessary to take into account the dependence of norms and standards on the duration of the production cycle, the conditions of logistics (intervals between deliveries, the size of the supplied lots, the remoteness of suppliers, the speed of transportation) and the conditions for the sale of products.
The methodology for calculating the need for working capital using the direct account method is presented below.
General working capital ratio is the sum of private standards:
N total \u003d N p.z + N n.p + N g.p + N b.r,
where N p.z - the standard of production stocks;
N n p - the standard of work in progress;
N g.p - the standard of finished products;
N b.r - the standard for deferred expenses.
All components of the general standard of working capital must be presented in monetary terms.
The standard of production stocks is determined by the formula:
N p.z \u003d Q days × N
where Q day is the average daily consumption of materials, rub.;
N - stock rate for this element of working capital, days.
The working capital stock rate is the period (number of days) during which working capital is diverted into production stocks. The reserve rate consists of the current, preparatory, insurance, transport and technological reserves:
The current stock is the main type of stock that ensures the continuity of the production process. The size of the current stock is affected by the frequency of deliveries under contracts and the volume of consumption of materials in production. It is usually accepted at the level of half the average interval between deliveries. The average interval between equal deliveries (supply cycle) is determined by dividing 360 days by the number of planned deliveries.
An insurance or guarantee stock is needed in case of unforeseen circumstances (for example, in case of short supply of raw materials) and is set, as a rule, in the amount of 50% of the current stock, but may be less than this value depending on the location of suppliers and the likelihood of interruptions.
The transport stock is created only in case of exceeding the terms of the cargo turnover in comparison with the terms of the document circulation. Document flow - the time for sending settlement documents and handing them over to the bank, the time for processing documents in the bank, the time for the postal run of documents. In practice, the transport stock is determined on the basis of actual data for the previous period.
A technological reserve is created during the preparation of materials for production, including analysis and laboratory testing. The technological reserve is taken into account only if it is not part of the production process.
The preparatory stock is set on the basis of technological calculations or by means of timing and refers to materials that cannot immediately go into production (wood drying, grain processing).
In a number of cases, a seasonal reserve norm is also established, when the seasonal nature is the type of harvested resources (sugar beet) or the method of delivery (water transport).
The working capital ratio for work in progress is determined by the formula.
In order for a business to operate, it must have optimal and required amount of working capital. Their role is not exaggerated at all, because they participate in the main stages of production: supply, production and sales.
First stage represents the purchase of a certain amount of inventories for the company's cash, second- the entry of these stocks into the production cycle and their transformation into finished products, and, finally, final stage is the receipt by the company of profit, which partially returns the cost of working capital. All this suggests that working capital is money invested in the means of production.
As manufacturing process it is possible to carry out only if the necessary amount of working capital is available, an important component of the production planning of activities should be rationing their stock. This will avoid the suspension of the enterprise and will make it possible to rationally use funds for the acquisition of current assets.
The process aimed at determining the norms of the stock by groups of working capital is called rationing. There are more stable elements, the regulation of which is acceptable and appropriate, and there are those that change very often and significantly and do not have a direct impact on the production process.
For the latter, standards are not developed at all (for example, funds in settlements, shipped unpaid goods, etc.).
Some elements of working capital provide direct impact on the production process. For them, it is necessary to establish a norm that is necessary for the enterprise (for example, inventories, etc.).
Some companies use an integrated approach when rationing, while others ration only those elements of current assets that are more involved in the production process. But only that leadership is mistaken, which does not establish any standards at all when planning production activities.
Today, each enterprise, when planning its activities, develops standards, and also chooses a more appropriate method of regulation, each of which should be considered in more detail.
For a planned economy, the most applicable normative method planning, which implies the existence of certain standards, calculated taking into account predetermined amounts of expenditure of material, financial and time resources. The latter, in turn, are determined on the basis of last year's data or on the basis of technical standards. In simple words the essence of this method is to establish standards that will subsequently serve to form a system of planned indicators.
Direct Count Method implies the definition of the norm for all elements of working capital. Each standard is determined taking into account the fact that in the process of functioning of production, its organizational and technical level changes.
It is because of these changes this method in the industry is considered basic. With its help, you can most accurately determine the amount of working capital that the company must have to carry out a continuous production process.
Sometimes, when calculating the standards, it is assumed that no changes will occur in the operating conditions of the enterprise during the planned period. This method is called analytical. Its main feature is that the calculation of standards is carried out on the basis of an analysis of the effectiveness of the use of funds in the previous period.
When setting the standards, the ratio of the growth rates of production volumes and the size of normalized working capital in the previous period is taken into account. This method is most in demand for enterprises whose specific share of inventories is quite large in relation to the working capital that the company has.
If, when calculating the standard, the indicator of the previous period is taken as the basis and changes in the conditions of the production process are taken into account, then this method is usually called coefficient.
The management of each enterprise independently decides which method is best to use. The selection takes into account many factors: the period of existence of the company, the scope of activities, its size and capabilities. However, in practice, as a rule, the first two methods are used by enterprises operating for more than a year, which have already managed to develop production program and improve the production process.
These companies calculate indicators using these methods due to the fact that the state does not have the necessary number of qualified economists who are able to conduct a more detailed analysis.
As you can see, there are ways to set standards a large number of, but in order to better understand the rationing process, you need to understand how individual indicators and the general working capital ratio are calculated.
Suppose there is an enterprise OJSC "Best", which, when planning its activities, calculates standard indicators. Using the example of this organization, we will consider how it would be right to do this.
The first indicator is called standard of production stocks and characterizes the duration of the period during which the product will be in the preparatory, current and insurance stocks. This indicator is calculated by multiplying the average use of materials during the day and the sum of the norms of preparatory, current and insurance stocks.
Refinery = Qday. * (Np.z. * Nt.z. * Nstr.)
Let's assume that there are 20 suppliers interacting with the company in question, while the delivery cycle is 4000 days. The safety stock rate is a tenth of the current stock rate, while the average daily volume required material is 30 kg, each of which costs 20 rubles. The technological cycle is 5 days
We determine the standard of inventories by performing following calculations:
- Material consumption in one day = 30 kg * 20 rubles = 600 rubles.
- Current stock rate = 4000 / 20 / 2 = 100 days.
- Safety stock rate = 100 * 10% = 10 days.
- Technology stock rate = 5 days.
- Total inventory rate = 100 + 10 + 5 = 115 days.
Thus, the desired indicator is 115 * 600 = 69,000 rubles.
The next particular indicator is called standard of work in progress, that is, products that are at various stages of processing. This indicator is calculated as follows:
Nn.p. = Vday. * Tts. * Kn.z., where
Vday- the number of products that are planned to be produced per day, Tts.- the number of days in the production cycle, Kn.z.- the coefficient of increasing costs.
In the example, the costs at Best OJSC are distributed unevenly and the following resources are required for production:
Cost escalation factor (with uneven distribution) = 1000 / 1200 = 0.83.
Work in progress standard = 11,000 * 5 * 0.83 = 45,650 rubles.
Necessary for further calculations is the standard of working capital for finished products, that is, the standard of products placed in a warehouse for the purpose of their sale in the future.
This standard is usually calculated by multiplying the average daily output of the product at cost and the stock rate.
Ng.p. = Bday * Nz.g.p.
Considering the company produces three types of products, individual indicators for which are presented in the table:
| Product type | Daily, thousand rubles | Nzgp, days | Ngp, thousand rubles |
|---|---|---|---|
| Total | 218 | ||
| A | 5 | 10 | 50 |
| B | 12 | 8 | 96 |
| C | 6 | 12 | 72 |
The last particular indicator is called standard for deferred expenses, it characterizes the maximum allowable amount of working capital that can be used to finance future expenses.
This standard is calculated using following formula:
Nrbp \u003d P0 + Rpl - Rsp
For the company in question, the calculation of this indicator will be carried out in accordance with the following table:
| Type or group of expenses | Р0, thousand rubles | Rpl, thousand rubles | Rsp, thousand rubles | Nrbp, thousand rubles |
|---|---|---|---|---|
| Total | 5000 | 3000 | 800 | 7200 |
| Expenses for the development and implementation of new products | 1000 | 2500 | 700 | 2800 |
| The cost of renting and repairing storage facilities | 4000 | 500 | 100 | 4400 |
After performing the above calculations, it is calculated general working capital ratio, that is, an indicator that characterizes the planned stock of inventory items necessary for the successful and uninterrupted operation of the enterprise and is the sum of all private standards that were presented above.
This ratio is calculated using the following formulas:
Ntot = Np.z. + Nn.p. + Ng.p. + Nb.r.
Now, to determine this indicator for the company "Best", you need to sum up all the private standards that were found earlier:
H (total) \u003d 69000 + 45650 + 218 + 7200 \u003d 122068 thousand rubles.
Thus, we can conclude that for the successful and uninterrupted operation of production, the company must have working capital totaling 122,068 thousand rubles.
Rationing of working capital is a very important and time-consuming process. Thanks to the establishment of standards, the company can rationally plan production process and not overpay for the storage of working capital.
The essence and composition are presented in this video.
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