Assessing Corporate Financial Health. Evidence from the Agricultural Sector in the Republic of Serbia

"A large number of studies have been conducted examining certain aspects of the financial situation of agricultural enterprises in the Republic of Serbia. However, the overall situation of these companies has rarely been the subject of analysis in previous studies. Therefore, this paper represents an attempt to comprehensively assess the financial conditions of large and medium-sized agricultural enterprises in the Republic of Serbia. Three models (Emerging market scoring, DF Indicator and G-Index) were used to analyse the key areas of financial security (liquidity and debt) and business success of 38 agricultural enterprises in the period from 2017 to 2021. By classifying the total values recorded into zones of financial health, an assessment of their overall position was made. The companies studied at the group level showed a satisfactory financial situation, due to favourable performance in individual cases, while the majority of enterprises were at risk in all business dimensions studied, with the exception of debt. During the analysis period, most of the companies under review recorded low liquidity, which was often accompanied by low profitability. The results of this work provide an insight into the key specifics of the activity of agricultural companies from the point of view of financial analysis and, in this sense, represent an important additional tool in the process of their management, but also contribute to creating an adequate basis for comparison with other business activities in the Republic of Serbia. "