The Management of Disinvestment Decision and its Impact on Financial Statements

• Main Authors: Moisescu Florentina, Persicov Oana
• Format: Article
• Language: English
• Published: Dunarea de Jos University of Galati 2016-07-01
• Series: Risk in Contemporary Economy
• Online Access: http://www.rce.feaa.ugal.ro/images/stories/RCE2016/MoisescuPersicov.pdf

The political and economic context of the world noticeably influenced, in recent years, the economic development of corporations, causing sometimes resounding failures, forcing businesses to act with caution. In this context, senior management decisions are oriented towards achieving financial stability, even if this implies a stagnation in terms of the financial result and not a constant profit growth. This paper examines the impact of fixed alienation on the entity's financial results, the importance of rational management strategie that lead to the creation of new sources of investment and the timing of disinvestments by applying the Altman model to the Romanian energy companies quoted at BVB. It has been found that the incorrect clasification of assets held for sale, changes the structure of the expenses incurred with the amortization said tangible assets because at the moments of their classification as assets held for sale, assests cease to be amortized. In the case of the failure of the Retail Plan, the recording of the accounting depreciation stops and the asset is being over-evaluated.