Agricultural Enterprises Bankruptcy in the Altai Region, Russia

The activities of agricultural enterprises that carry out large investment projects mainly at the expense of borrowed funds are associated with the emergence of idiosyncratic risks. Its neglect, given the existing development of economic relations and the credit policy of commercial banks in Russia, determines the instability of the functioning of the entire agro-industrial complex and generates meso- and macroeconomic shocks. The purpose of this study is to identify the main patterns that determine the financial condition of agricultural enterprises of the Altai Region, which carried out active investment activities, but were liquidated due to financial insolvency. The novelty of the research lies in the development of methodological provisions for the express analysis of the financial condition of agricultural enterprises implementing large investment projects, based on the calculation of advancing coefficients of the main financial and economic indicators in dynamics, which allows investors to receive timely signals about the state of organizations and the formation of sufficient cash flows in them. The practical significance of the study lies in the identification of the significance of the influence of idiosyncratic shocks arising in the conditions of favorable pricing in the main agricultural markets and the increased debt load on organizations carrying out large investment projects. Thus, the liquidation of financially insolvent large enterprises has significantly improved the solvency structure of the enterprises in the region. The types of activity of the analyzed enterprises (milk production, pig breeding, growing vegetables, and grain crops) did not affect the situation, and the observed patterns were identical. The determination of balanced proportions from the consolidated financial statements for 2009–2010 showed an increase in crisis situations from 2012–2013 (in different ways in each particular organization): quick-selling assets were not enough to pay off current payments, slow-moving assets not allowing to pay off long-term loans and payments. The shortage of funds to pay all amounts payable, short-term loans, and borrowings, in some years, reached 3.4 billion rubles, which indicated that there was a rather high risk of default on credits, loans, and investments.