INFLUENCE OF ECONOMIC AND NON-ECONOMIC FACTORS ON THE PROFITABILITY OF THE ENTERPRISE

Abstract

The paper investigated the influence of factors reflecting economic and non-economic aspects in enterprise activity on its profitability. With data, about 15 enterprises became the initial base of research. The research period was 2015-2020. By results, a conclusion about a decrease in indicators of assets profitability and shareholders' equity over years is made. It was found that among the factors that reflect the economic aspects of the enterprise's activity, the company's solvency has the greatest impact on the company's profitability. According to the results, among the factors reflecting non-economic aspects are the consistency of managerial decisions and the activity of implementation in the practice of socially responsible business. Negative impact indicators of inventory turnover and the size of the enterprise on its profitability have been diag-nosed. Variability indicators for turnover of accounts receivable, financial leverage coefficient by the nature and strength of their impact on the profitability of the enterprise was established. We have found that the combined effect of inventory turnover, receivables, current assets, financial leverage ratio, sol-vency, the size of the enterprise, the effectiveness of management activities, the activity of implementing the social prin-ciples responsibility of business. The profitability index (56,4 % of own capital (67,8 %) of the investigated enterprises accounts for a considerable part regarding the variation within assets profitability. To forecast assets profitability, it is reasonable to use indicators of solvency and size of an enterprise; for equity return-the coefficient of financial leverage, solvency and enterprise. This research has the practical sense to use its results in the profitability management of the enterprise.