Analyzing the financial situation at quang trung industrial group co , ltd for the period of 2017 2019

OVERVIEW OF THE RESEARCH PROJECT 1.Origin Of the study In the current market economy, constantly innovating and increasingly fierce competition among businesses, so sustainable development and profitable business are a practical target for any business sector Come on To achieve that, the enterprise must regularly conduct financial analysis to clearly see the current state of financial activity, business performance of the enterprise as well as fully identify the cause and level of image impact The influence of factors to help managers come up with effective solutions and accurate decisions to improve the business and production efficiency of enterprises Recognizing the importance of analyzing the financial situation of businesses, I chose the graduation thesis topic: ―Analyzing the financial situation at Quang Trung Industrial Group Co., Ltd for the period of 2017- 2019 ‖ Objective of the Study The topic focuses on analyzing the financial situation of the company to see the financial situation at the company, thereby offering solutions and proposals with the following specific objectives: - Overall assessment of the financial situation - Analyzing financial structure and capital guarantee situation for business activities - Analyzing the situation and solvency of the company - Analyzing business efficiency - Analysis of financial ratios through the financial statements of the company - Analyzing the efficiency of capital use, profitability of capital sources Scope of the Study The scope of study is the financial situation of the enterprise through financial statements including balance sheet, income statement, cash flow statements and financial statement footnotes for the period of 2017-2019 Research Methodology of the study - Data collection method: collect data through company reports and documents - Data processing method: the basic reason is mainly followed by specific analysis of actual data through reports and documents of enterprises - Using analytical methods: comparison method, ratio method, Dupont method to analyze data, synthesize variables over years Structure of the study The graduation thesis consists of chapters: Chapter 1: Literature review Chapter 2: Financial statement analysis at Quang Trung Industry Group Joint Stock Company in the period of 2017-2019 Chapter 3: Solutions to improve the financial situations of Quang Trung Industry Group Joint Stock Company Chapter 1: Literature review 1.1 Overview of financial statements 1.1.1 Definition of financial statements According to the Institute of Certified Public Accountants (AICPA) :― The financial statements are prepared for the periodic review or report on the operation of the enterprise, the investment situation in the business and the results achieved in the reporting period The financial reporting system reflects the combination of recorded events, accounting principles and assessments that are primarily applicable to the recording of events.‖ According to the Vietnamese accounting system, Financial statements are types of accounting reports that generally and comprehensively reflect the situation of assets, capital sources, the situation and results of production and business activities of enterprises in a certain period As such, financial statements not only provide information primarily to entities outside the business such as investors, tax authorities, banks and other financial institutions, but also provide information providing information to corporate executives, helping them assess and analyze the financial situation as well as business results of enterprises Within the scope of the thesis, the author uses the definition of financial statements as follows: ―Financial statements are a system of statements made according to the current accounting standards and regime reflecting the most general information about the financial statements Main economic and financial news of the unit Accordingly, the financial statements contain the most comprehensive information on the situation of assets, equity and liabilities as well as the financial situation, business results in the period of the enterprise ‖ 1.1.2 Functions of financial statements The system of financial statements of enterprises is made for the following purposes: - Summarizing and presenting in a general and comprehensive manner the situation of assets, capital sources, debts, situation and results of business operations of enterprises in an accounting period - Providing key economic and financial information for assessing the situation and performance of the enterprise, assessing the financial status of the enterprise in the past operating period and future forecasts Financial statements are important in the field of economic management, attracting the attention of many objects inside and outside the enterprise Each subject cares about the financial statements on a different level, but generally aims to get the information needed to make decisions that are appropriate to their goals - For business managers, the financial statements provide general information about the situation of assets, sources of asset formation as well as the situation and results of business after an operation period, on which Management will analyze, evaluate and propose timely management solutions and decisions suitable for the future development of the enterprise - With relevant state agencies such as finance, auditing bank, tax Financial statements are important documents in checking, supervising, guiding and advising enterprises to implement policies, economic and financial regimes of enterprises - For investors, lenders financial statements help them identify their financial capacity, the situation of the use of assets, capital, profitability, efficiency of production and business activities , level of risk for them to consider, choose and make an appropriate decision - With suppliers, financial statements help them identify solvency, payment methods, from which they decide to sell goods to businesses again, or need to apply payment methods for the reasonable - With customers, financial statements help them have information about the ability, production capacity and product consumption, reputation level of the business, customer treatment policies so they have right decision in the purchase of the business - For shareholders, employees, they are interested in information about the ability and policy to pay dividends, salaries, social insurance, and other issues related to their interests shown on financial report 1.1.3 Categories of financial statements 1.1.3.1 Balance sheet  Definition: A balance sheet is a statement of the financial position of an enterprise stating assets, liabilities and equity at a given time In other words, the balance sheet illustrates the net value of a business The balance sheet may also contain details from previous years for comparison purposes This data will help businesses track their performance and will identify ways that companies can build their finances and see where businesses need improvement In essence, the balance sheet is a general balance sheet between assets and equity and liabilities  Function: Balance sheet: Provides information about the situation of assets, liabilities, sources of assets formation of the enterprise at a given period, helping to assess the financial status of the business, such as fluctuations in the size and structure of assets, sources of assets formation, solvency, profit distribution At the same time, it helps to evaluate the ability to mobilize capital into the production and business process of the enterprise in the coming time 1.1.3.2 Income statement  Definition The report on business results shows the movement of capital in the production and business process of the enterprise In addition, the report on business results reflects revenue, income, expenses and business results Through this report, information users can assess business performance of the business Also know the scale of costs, revenues, income and results of business activities as well as the net profit before and after corporate income tax  Function Income statement: Providing information on business results of the enterprise in the period, providing information on the fulfillment of obligations to the State budget From the analysis of the data on the analysis of business results, the enterprise can control potential changes in future economic resources, assess the profitability of the business, or cost effectiveness of additional resources that businesses can implement 1.1.3.3 Cashflow statement  Definition A cash flow statement is one of four mandatory financial statements that an enterprise must prepare to provide its users with information about the enterprise The statement of cash flows reflects issues related to the source of cash in and out in the enterprise, the situation of short-term revenue and expenditure of the enterprise Sources of cash in and out of businesses and amounts considered as cash are divided into three groups: cash flows from investing activities, cash flows from financial activities and cash flows from operating activities  Function Cash flow statement: Provides information on financial fluctuations in the enterprise, helps to analyze the investment, financial and business activities of the enterprise, to assess the ability to generate money and cash equivalents in the future, as well as the use of these sources of money for business activities, financial investment of enterprises 1.1.3.4 Notes  Definition Notes to the financial statements are also an annual financial report that must be prepared for an enterprise Notes to the financial statements are also used to explain and add to the criteria that other financial statements have not shown or explained complicated items  Function Provide more detailed information about the characteristics and general situation of the business; about the income of the employee; on the causes of increase or decrease of fixed assets (according to their original prices, their remaining values); on the increase and decrease of capital sources, enterprise funds; contingent liabilities, commitments and other financial information, which helps in a specific analysis of some indicators, reflecting the financial position that other financial statements cannot present 1.2 Overview of financial statements analysis 1.2.1 Definition of financial statements analysis Financial statement analysis is the process of reviewing, checking, comparing and comparing financial data in the past business period Through data on the analysis of financial statements will provide users with information that can assess the potential, business performance as well as future financial risks of the business Analyze financial statements to provide useful information not only for corporate governance but also to provide economic - financial information mainly for non-business information users Therefore, analyzing financial statements does not only reflect the financial situation of the enterprise at a given time, but also provides information on the results of production and business activities of the enterprise in a given period 1.2.2 Role of financial statements analysis Analyzing the financial statements of an enterprise is an extremely important job in corporate governance It is not only meaningful to the business itself, but also necessary for other management entities related to the business Analyzing the financial statements of enterprises will help corporate governance overcome shortcomings, promote positive aspects and predict the development of enterprises in the future On that basis, corporate governance has come up with effective solutions to select and decide the optimal plan for production and business activities of the enterprise The role of financial statement analysis is to provide sufficient information to help business managers to see the vivid features on the "financial picture" of the enterprise expressed through the following aspects: - Providing timely, complete and truthful financial information necessary for business owners and investors, lenders, customers, suppliers - Provide information on the situation of capital use, ability to raise capital, profitability and production and business efficiency of the business - Provide information on the situation of liabilities, the ability to recover receivables, the solvency of payables as well as other factors affecting the production and business activities of enterprises 1.2.3 Process of financial statements analysis – EIC analysis 1.2.3.1 Economy analysis Economic analysis is a process followed by experts to understand important economic factors affecting the operation of an organization, industry, region or any other specific population group, with The purpose of making wiser decisions for the future In business, economic analysis allows incorporating factors from the economic environment such as inflation, interest rates, exchange rates and GDP growth into the company's plans Each organization is an open system that is impacted and influenced by the external context This means that proper evaluation of economic variables will facilitate the identification of opportunities and threats that may affect the performance of the company Organizations tend to implement business planning processes every one or two years and often identify two or three possible economic scenarios for short and medium term terms They then assess how each scenario will influence the company's decision and achieve its goals Economic analysis is also carried out when evaluating specific projects to consider economic and financial feasibility Economic analysis helps business owners get a clear picture of the current economic environment, as it relates to their company's ability to thrive Economists, statisticians and mathematicians often perform this analysis on behalf of for-profit and not-for-profit businesses These types of economic assessments include an in-depth assessment of market strengths and weaknesses An economic analysis is not limited to small or medium-sized businesses, it is also valuable to small companies In fact, small businesses may need to conduct economic analysis more frequently than businesses with sufficient capital and integrated resources to sustain the recession There are several types of economic evaluation methods that business owners can use to gain a holistic view of how their companies will bid in the future 1.2.3.2 Industry analysis Industry analysis is done by business entities or, in particular, by an entrepreneur to identify factors affecting the industry in which they have or are thinking about investing New entrants, the status of competitors, and both buyers and suppliers have a direct impact on the performance of an industry It is the concept of industry analysis that provides business entities with the information they need to plan their business effectively Remember, it is important to have a certain perspective on the work forces in the overall diagram of everything if you want to conduct a comprehensive strategic planning Industry analysis helps owners know about the various opportunities and threats facing businesses so they can take steps to combat them and gain a competitive advantage Understanding the industry's surroundings and the factors affecting them helps business executives predict future trends 1.2.3.3 Company analysis Company analysis is a process that includes analysis of the company's financial situation, products, services, and competitive strategy (the company's plan to deal with threats and environmental opportunities, external field given) Company analysis takes place after the analyst understands the company's external environment and includes answering questions about how the company will respond to threats and opportunities posed by the external environment The intended response is the individual company's competitive strategy Analysts should seek to determine whether the strategy is primarily defensive or offensive in its nature and how the company intends to implement it 1.2.4 Financial statements analysis methods 1.2.4.1 Common-Size Analysis Longitudinal analysis is a method of evaluating financial information by presenting each item in the financial statements as a percentage of the principal amount over the same period A company can use this analysis on its balance sheet or income statement Common size amount = (Analysis amount / Base amount) x 100% The base amount will vary depending on whether the company is completing analysis on its balance sheet or income statement If the company completes the analysis on the balance sheet, then the principal amount will be the total assets or total liabilities and equity Asset utilization ratios Inventory Turnover Receivables Turnover Total Asset Turnover Day inventory outstanding Days sales outstanding (Source: Author, based on financial report) a) Inventory turnover Inventory turnover indicates how many times per year, the inventories change into other forms of current assets It can help owners make better decisions on pricing, manufacturing, marketing, and purchasing new stock The company's inventory turnover decreased continuously in the period of 2017-2019 from 2.94 times in 2017 to 1.04 times in 2019, due to the decline in net sales of the company (especially the decline of sales of goods and services) The company purchased many raw materials and uncompleted production and business costs, in addition, the cost of goods sold decreased significantly by 25.03% compared to 2018, which caused the inventory turnover decreased to 1.04 rounds / year and inventory turnover time increased to 349 days It is usually a bad sign because products tend to decline as they sit in a warehouse while incurring holding costs Furthermore, excess inventory ties up a company’s cash and makes a drop in market prices The company needs to plan a reasonable inventory plan to increase capital turnover further, avoiding capital reserve at this stage, which will reduce business efficiency b) Receivables turnover Measures the effectiveness of the firm’s credit policy and also indicate the level of investments in receivables needed to maintain the firm’s sales level In the period 2017-2019, the average debt collection time of the company tends to increase In 2017, the average repayment period was 125 days, to 2018 was 152 days and increased to 183 days in 2019, equivalent to the number of receivable receivables decreasing from 2.91 cycles / year in 2017 to 2.41 rounds / year in 2018 and 1.99 rounds / year in 2019 The reason why the company's debt recovery period in the period of 2017-2019 tends to increase is because the company implemented a loose trade credit policy, causing the increase in customer receivables In the 2017-2019 period, net revenue from sales of goods and rendering of services tended to decrease but customer receivables tended to increase, causing the receivables turnover to continue to decrease and the time for debt recovery to increase Although loosen credit policy may make the company have more customers but it makes the business occupied by customers and incurred management costs receivables The company should consider adjusting the credit policy appropriately to bring the best results to the company in the near future c) Total asset turnover The total assets turnover indicates the efficiency with which the company uses its assets to generate revenue Lower ratios mean that the company isn’t using its assets efficiently and most likely have management or production problems 2.3.3 Long-term solvency ratios The analysis of a firm’s capital structure is essential to evaluate its long-term risk and return prospect Leveraged firms accrue excess return to the shareholder when ROE is higher than the cost of debt The benefits of financial leverage bring further risks, in the form of fixed cost (interest on debt) may affect profitability if the demand or profit margins decline The inability to meet those obligations may lead the company to failure and possible bankruptcy Long-term solvency ratios Debt to asset ratio Debt to equity ratio Equity multiplier Times interest earned ratio ( Source: Author, based on financial report) a) Debt to asset ratio The debt to asset ratio is a leverage ratio that measures the number of total assets that are financed by creditors instead of investors In other words, it shows what percentage of assets is funded by borrowing compared with the rate of resources that are supported by the investors Both investors and creditors use this figure to make decisions about the company This ratio of the company is the same in both years Total debt to total assets ratio is 0.25, this shows that 25% of its assets are financed by creditors, with owners (shareholders) financing the remaining 75% with equity b) Debt to equity ratio This ratio indicates the degree of financial leverage being used by the business and includes both short-term and long-term debt Lower leverage ratios tend to show a company or stock with lower risk to shareholders It means that a company has been a financially stable business c) Equity multiplier The equity multiplier is a financial leverage ratio that measures the portion of the firm's assets that are financed by stockholder's equity In other words, the equity multiplier shows the percentage of assets that are funded or owned by the shareholders Low equity multiplier reveals a company that is mostly funded by stockholders and that the debt financing is low making it a reasonably conservative investment The flip side is that its growth prospects might not be too high given its low business leverage d) Times interest earned This ratio indicates how many times a company could pay the interest with its before-tax income, so obviously bankers would favour the company with a much higher times interest ratio because it shows the company can afford to pay its interest payments when they come due Higher rates are less risky, while lower rates indicate credit risk In other words, a ratio of means that this firm’s income is times higher than its interest expense in 2017 2.3.4 Profitability ratios Profitability indicators notify us about the ability of the company to create profit and assess capital The aim of each company should be to raise profitability The results of profitability indicators are portrayed in the following Profitability ratios Return on sales Return on assets Return on equity (Source: Author, based on financial report) a) Return on sales The profit margin ratio shows what percentage of sales are left over after all expenses are paid by the business This ratio tends to increase gradually over the years In 2017, the profit margin of 18.07% means that for every VND 100 of revenue, the profit will be VND 18.07 In 2018, this ratio increased to 22.53% and in 2019 reached 27.72%, showing that the company's profit situation is developing well Although the revenue from sales and service provision tends to decrease over the years, the company has good control of expenses, so its business is still effective b) Return on assets This ratio is a profitability ratio that measures the net income produced by total assets during a period by comparing net income to the average total assets In other words, ROA shows how efficiently a company can convert the money used to purchase assets into net income or profits We see that this ratio in 2018 is the lowest, down 0.75% compared to 2017 By 2019, the ratio of profit to total assets increased sharply, reaching 14.06%, showing that in 2019 the enterprise uses assets with more effective than two years 2017,2018 c) Return on equity Return on equity measures how efficiently a firm can use the money from shareholders to generate profits and grow the company In general, this profitability also decreased in 2018 and increased again in 2019, specifically: In 2017, it was 11.08%, showing that for every VND 100 of capital invested, the company will earn VND 11.08 in profit In 2018, it was 10.11%, down by 0.97% compared to 2017, proving that the profitability of equity is not good compared to 2017 We see more equity in 2018 than in 2017 but profit falling profits reduces the efficiency of using equity In 2019, the profitability of equity increased significantly by 19.39%, an increase of 9.28% compared to 2018, 100 VND equity generated 19.39 VND of profit, showing the use of equity in the year 2019 is the most effective in three years 2.4 Dupont identity The profitability of an enterprise's equity is a result of a series of measures and management decisions To see the impact of the relationship between cost management, capital management, and capital management to the profitability of the owner of the enterprise, a system of criteria has been developed to consider The influence of factors on the rate of return on equity The following are equations to consider influencing factors through financial coefficients The ratio of after-tax profit to business capital is determined as follows: (1) Considering this relationship, we can see how the impact of the ratio of profit after tax on revenue and how the whole capital turnover affects the rate of profit after tax on business capital On the basis of the enterprise manager proposed appropriate measures to increase the ratio of after-tax profit to business capital The factor affecting the ratio of profit after tax to equity (ROE) can be calculated by the following formula: From formula (1), we can determine the rate of return on equity by the following formula: Through the above formula, show that three main factors affecting the rate of return on equity in the period are: + Ratio of after-tax profit on revenue: Reflecting the level of business management and cost of the enterprise + Total capital turnover: Reflecting the level of exploitation and use of assets of the Company + Debt to equity ratio: Reflect the governance chart to organize the capital source for the company's operations On the basis of identifying factors, it will help corporate managers identify and find ways to exploit potential factors to increase the Company's equity return The lowest rate of return on assets is 7.61% in 2018 and 2019 is the highest at 14.06%, showing that in 2018, the company's efficiency in using capital was not effective, but in 2019 there were better signs, The company needs to continue pushing this ratio higher in the following years Based on formula (1), we see that the rate of return on assets is influenced by two factors: profit on revenue and revenue on assets, so in order to improve this ratio, the company needs to link synchronous contract enhances these two factors To improve the ratio of profit to revenue, the company must improve its net profit so that the growth rate of profits is faster than the growth rate of revenue The best way to increase profit is to control the total cost well 2.5 Evaluate of financial situation 2.5.1 Advantages - Short-term assets of the company have increased over the years - Liabilities accounted for a small proportion of the total capital (24%) in all three years, showing that the company is less dependent on shortterm external loans, the company has a financial initiative - In 2017, revenue from financial activities increased sharply by 5064.21% over the previous year because the company received interest from bank deposits - Increasing inventories over the years proves that the company expanded its business scale by investing in raw materials - Equity accounts for 75% of the total capital, showing that the company's financial autonomy is very high, the company's working capital is less dependent on external funding - Increasing profit after tax over the years shows that the company is operating effectively, but the company needs to take measures to improve revenue from sales and service provision.Quang Trung Group is constantly updating information on technology and adding the most modern machinery in the world to research and production centers in Quang Ninh and Ninh Binh Especially since 2016, when 4G technology has flourished in Vietnam, the group has invested trillions of dong to replace a series of high-tech machines - The company always ensures excellent quality and completion schedule of projects and products delivered to customers who always receive customer satisfaction, so in the past three years, the company has not incurred sales deductions The company's net revenue is always guaranteed to be equal to the revenue from sales and service provision - Administration expenses are being maintained fairly stable; the proportion of administration expenses to net revenue is on a downward trend It shows that the company is taking suitable measures to improve its business management costs - Although the cost of goods sold accounts for a large proportion, due to the company's good management of expenses, profit after tax has grown continuously for three years 2.5.2 Limitations and cause of limitations - Cost of goods sold accounts for a large proportion of net revenue, making net profit from operating activities low This means that the company will lose a competitive advantage with competitors - Financial expenses increase gradually over years because the company constantly incurs more short-term bank loans - The company has low current ratio, this has the risk of insolvency of the company - The company holds too little cash so if there are fast payments, the company will have big financial problems - The company's customer receivables are of great value because the company has implemented a policy of loosening credit to increase receivables, increase provisions for doubtful debts and increase the time customers take capital of the business - The company's cash flow mainly comes from investment activities, not production and business activities This implies unsustainable factors in the development of the company Chapter 3: Solution to improve the financial situation of Quang Trung Industry Group Joint Stock Company 3.1 Backgroup Mechanical engineering is one of the industries with a long history in our country Initially, it was manifested in the form of handicrafts creating production tools, weapons serving the construction, development and preservation of the country During the French colonial period, although this profession was strongly developed, it could not become an industry in the true sense of engineering It was not until 1958, when Tran Hung Dao Mechanical Factory was built, that the foundation of the mechanical industry was rekindled Since then, the industry has developed quite comprehensively, has specialized in a number of areas, the level of technology is also at a certain level and plays a role as the "backbone" industry of social production, supply of equipment, machine tools, movers for all economic sectors, meeting the daily needs of the people, making an important contribution to the development of the land economy country Identify the important and fundamental role of the mechanical engineering industry in socio-economic development On October 17, 2003, the Politburo issued Conclusion 25-KL / TW on the development strategy of mechanical engineering industry in Vietnam with specific views and guidelines: ―Mechanical engineering is a base industry foundation, has a particularly important role in the socio-economic development "and" must build the mechanical engineering industry to be competitive enough to rise up in the market mechanism and international economic integration " Taking advantage of the attention and support of the Government and the Vietnamese mechanical engineering industry in recent time has achieved certain results Specifically, some fields recorded changes and breakthroughs such as: Manufacturing hydraulic equipment (providing for large and small hydroelectric plants throughout the country), manufacturing oil and gas drilling rigs ( supplying oil and gas exploration and exploitation drilling rigs to a depth of 120m, self-elevating drilling rigs of 90m water, oil well-drilling rigs), electric equipment, manufacturing and supplying equipment for cement and shipbuilding plants types (oil tankers with tonnage of 105 thousand DWT, liquefied gas tankers with a tonnage of up to 5,000 tons, bulk carriers, etc.), complete works and equipment (sugar plants with a capacity of 1,000 tons of sugarcane / day, processing rubber latex with a capacity of 6,000 tons / year) Domestic mechanical engineering has also produced and assembled almost all types of cars, trucks and passenger cars; Motorbike production has the localization rate of 85-95%, meeting domestic demand and export A number of research and design agencies and mechanical manufacturing enterprises have been gradually renovating and improving their consultancy, designing and manufacturing equipment and technology capacity, taking part in implementing a number of bidding packages of projects national key projects The number of mechanical enterprises increased rapidly, from about 10,000 enterprises (in 2010) to more than 21,000 enterprises in 2016, accounting for 28% of the total number of manufacturing enterprises, creating jobs for more than million workers, accounting for 17% of the total number of employees in processing industry According to calculations by the Institute of Industrial Strategy and Policy (Ministry of Industry and Trade), the industrial production value of the Mechanics industry in 2015 accounted for 16.36% of the production value of the processing and manufacturing industry According to statistics, in 2016, the export turnover of mechanical products also reached over 13 billion USD, mainly of all kinds of home appliances and spare parts of cars and motorcycles If including all kinds of iron and steel, the export turnover of mechanical products of Vietnam in 2016 reached over 16 billion USD These results have partly contributed positively to socioeconomic development and accelerated industrialization and modernization of the country 3.2 SWOT analysis - Strength: + Firstly, the mechanical engineering industry has had quite comprehensive developments, there has been specialization in some fields, the level of technology is also at a certain level and plays a key industry in the field of manufacturing, supplying equipment, machine tools, movers for all economic sectors, meeting the daily needs of the people, making an important contribution to the development of the economy + The Government issues a strategy to develop Vietnam's mechanical industry, giving priority mechanisms and policies to the development of a number of key mechanical products - Weaks: + Firstly, about the market: Mechanical industry is diversified in products but competition from imported products is quite fierce The market expansion is still difficult due to the lack of market information and the competitiveness of domestic enterprises is not strong enough + Secondly, on the level of science and technology: The practice shows that Vietnam Mechanical Industry has very few registered inventions, inventions, equipment and technology level of the whole industry slow to innovate The mechanical enterprises lack output for products, so they not have the opportunity to accumulate and invest in technological innovation + Thirdly, regarding raw materials: Raw materials for the mechanical engineering industry are mainly steel and other non-ferrous alloys, most of these materials cannot be produced domestically, so they must be imported + Fourthly, on human resources: Manpower of Vietnam Mechanic industry is lacking and weak both in quantity and quality The number of skilled mechanics has decreased, and the number of professional workers lacks international vocational certificates and foreign language skills The research and development force, first of all, the design consultancy team has not reached the level, meeting the requirements of works and projects on synchronous mechanical equipment - Opportunity: According to experts' assessment, Industry 4.0 has an important impact on mechanical production in the present and in the future, especially on technology management issues, production management , specifically : Industry 4.0 will bring many opportunities for the development of Vietnam's Mechanical Industry, which are: + Firstly, Industry 4.0 allows mechanical enterprises to access information, access to knowledge, access to advanced technologies + Secondly, Industry 4.0 with breakthroughs in new technology helps to significantly reduce robot manufacturing and operation costs, dramatically reducing production costs of additive manufacturing technology (3D printing technology), thus making increase the applicability of robots, embankment technology to replace cutting technology in mechanical production for countries with limited economic potential like Vietnam + Thirdly, mechanical workers have a desire to learn and be quick and easy to adapt to new things, so it is very easy to adapt to new opportunities and technologies from Industry 4.0, thereby raising Highly qualified, creative and grasp advanced technology for application + Fourthly, with quick access and flexible application of achievements of Industry 4.0, the mechanical engineering industry of our country will have many opportunities in improving technology level, increasing productivity, shortening the time for products on the market, produce products with quality, competitive prices thereby, changing the way of management and management in mechanical production - Threat: Besides opportunities, Industry 4.0 also brings many challenges to Vietnam's Mechanical Industry, which are: + Firstly, in Industry 4.0, workers in Mechanical industry may have difficulty in finding jobs, because manual jobs will be automatically replaced by robots and automated machines The formation and development of the mechanical workforce equipped with skills and qualifications to exploit and master technologies and new modes of operation are also a big challenge for human resource training Mechanical force in our country today + Secondly, our mechanical engineering enterprises are mostly small and medium-sized enterprises, not yet capable of competing, not ready to access new technologies Many enterprises are still passive in new development trends, not ready to change the business organization model, in which, competition pressure is increasingly fierce and facing pressure on investment resources to convert, innovation, breakthrough 3.3 Solution to im improve the financial situation of Quang Trung Industry Group Joint Stock Company  Firstly, the corporation needs to improve the efficiency of using assets and equity through the following measures: - Limit the procurement of unused fixed assets Therefore, ensure the effective use of capital, the corporation should only invest in machinery and equipment for new products when accurately forecasting market fluctuations - Reduce unnecessary assets, liquidate unused assets, no longer used or used but outdated, ineffective, reduce depreciation costs  Secondly, the company needs to focus more on debt collection and inventory clearance to enhance solvency  Thirdly, it is a good idea to increase cash and cash equivalents if there are too few cash reserves On the contrary, having too many cash reserves is not suitable for the company because it will affect investment activities So the corporation needs: - Make budget forecasts and forecast revenue and expenditure scientifically to be proactive in the payment process in the period - Establish a reasonable reserve of cash capital, while ensuring the solvency and ensuring the profitability of idle cash capital  Fourthly, the company needs to develop a new business strategy because the company's business situation in the 2017-2019 period, although profitable, is too low, not commensurate with the potential and resources of the company company Therefore, the company needs new business strategies to exploit its full potential Otherwise the company will quickly be left behind when the mechanical industry market becomes increasingly fierce  Fifthly, to improve the efficiency of production and business activities, increase profits for businesses, the company needs to save costs in the production process - The company has to liquidate outdated machinery and equipment, invest in new and modern equipment, although it will have to invest a large amount of money at the present time, but the company will save raw material and labor costs during the next production phase - The company should boldly invest in the field of providing construction materials, both to provide materials for itself and to provide materials for other companies, to so Cost of goods sold of the company will be significantly reduced by not having to buy input materials from suppliers - The company should adjust the credit policy, reduce payment discounts for customers and shorten repayment time to reduce financial costs and reduce the time customers take over the company's capital However, it is necessary to make reasonable adjustments so as not to lose existing customers and attract potential customers - The company needs to reduce the proportion of bank loans to be more financially active, reduce borrowing costs Each year, the company needs to make a specific business plan on revenue situation to determine a reasonable amount of inventory to avoid excessive inventory expansion, leading to unnecessary increase in inventory costs ... information about the situation of assets, liabilities, sources of assets formation of the enterprise at a given period, helping to assess the financial status of the business, such as fluctuations... and financial news of the unit Accordingly, the financial statements contain the most comprehensive information on the situation of assets, equity and liabilities as well as the financial situation, ... 1,5 9 0,4 8 7,2 5 5,0 7 4, an increase of VND 13 0,5 1 4,2 2 2,4 31 compared to 201 8, equivalent to the rise of 8.94% The sharp decline of other short-term assets from VND 1 6,3 5 3,0 7 7,2 58 to VND 2,5 2 0,5 9 5,4 73,