FINANCIAL DISTRESS INDICATORS EVALUATION OF FARMS

Each economic phenomenon is caused by various factors, and financial distress cannot occur without reason. Changes in the economy leads to the demand, and farms, as well as other business organizations face intense competition and work under uncertain operational environment. Scientists agree that the internal and external environment causes financial distress of farm. Most of financial distress research has been concentrated in the internal causes of poor farming. Therefore, it can be assumed that the internal and external factors affect financial ratios, i.e. these factors are indicators of financial distress causes variation. In this way, both internal and external factors can be assessed through indicators of financial distress. The object of the research - financial distress indicators of farm. The aim of the research – to evaluate financial distress indicator suitability of farm financial distress diagnosis. The paper carried out an evaluation of indicators of financial distress of farms in order to determine which indicators can be reliable and suitable for farm financial distress diagnosis. In this study, was used financial distress indicators evaluation of farm with paired correlation, partial and semi-partial correlation analysis. DOI: https://doi.org/10.15544/ssaf.2012.3