The article dwells on theoretical views of scientists on the essence of the concepts referred as “liquidity” and “solvency”, since under the conditions of high competition in the market an objective assessment of the financial plight of business entities occupies a special place. It is underscored that one of the key criteria aimed at the assessment of financial plight is considered to be liquidity and solvency ratios. It is noted that despite the large considerable number of publications concerned with assessment of liquidity and solvency there is no reasonable evidence of a difference between these two closely related indicators. Uncertainty in the understanding of the studied indicators leads to an incorrect use of analysis methods and to a distorted opinion about the financial position of the analyzed enterprise. In reference to it, the author of the article reveals the essence and distinctive properties of the concepts entitled “liquidity” and “solvency”.
liquidity, solvency, current solvency, degree of liquidity, financial plight, assets, liabilities
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