Financial Sustainability Evaluation and Forecasting Using the Markov Chain: The Case of the Wine Business
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Дата
2020
Автори
Rekova, N. Yu.
Telnova, H.
Kachur, O.
Golubkova, I.
Balezentis, T.
Streimikiene, D.
Рекова, Н. Ю.
DOI
https://doi.org/10.3390/su12156150
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Номер ISSN
Назва тому
Видавець
MDPI
Анотація
This paper proposes a framework for assessing the financial sustainability of a wineproducing company. The probabilistic approach is used to model the expected changes in the financialsituation of an enterprise based on the historical trends. The case of an enterprise in Ukraine isconsidered as an illustration. The Markov chain is adopted for the forecasting exercise. Using theMarkov chain framework allows one to predict the probability of financial security change forseveral periods ahead. The forecast relies on the transition probabilities obtained by exploiting thehistorical data. The proposed framework is implemented by construction of the financial securitylevel transition matrices for three scenarios (optimistic, baseline and pessimistic). The case studyof a Ukrainian wine producing company is considered. The possibilities for applying the proposedmethod in establishing anti-crisis financial strategy are discussed. The research shows how forecastingthe financial security level of a company can serve in anti-crisis financial potential buildup.
Опис
Ключові слова
financial security , Markov chains , wine sector , forecasting , transition matrix
Бібліографічний опис
Rekova, N., Telnova, H., Kachur, O., Golubkova, I., Baležentis, T., & Streimikiene, D. (2020). Financial Sustainability Evaluation and Forecasting Using the Markov Chain: The Case of the Wine Business. Sustainability, 12. 6150. doi: https://doi.org/10.3390/su12156150.
Rekova, N., Telnova, H., Kachur, O., Golubkova, I., Baležentis, T., Streimikiene, D. Financial Sustainability Evaluation and Forecasting Using the Markov Chain: The Case of the Wine Business. Sustainability. 2020. 12. 6150. DOI: https://doi.org/10.3390/su12156150.
Rekova, N., Telnova, H., Kachur, O., Golubkova, I., Baležentis, T., Streimikiene, D. Financial Sustainability Evaluation and Forecasting Using the Markov Chain: The Case of the Wine Business. Sustainability. 2020. 12. 6150. DOI: https://doi.org/10.3390/su12156150.