Scenario-based financial planning: the case of Ukrainian railways

Olha Kravchenko; Nadiia Bohomolova; Oksana Karpenko; Maryna Savchenko; Nataliia Bondar; Olha Kravchenko; Nadiia Bohomolova; Oksana Karpenko; Maryna Savchenko; Nataliia Bondar

doi:10.3934/NAR.2020013

National Accounting Review

2020, Volume 2, Issue 3: 217-248. doi: 10.3934/NAR.2020013

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Research article

Scenario-based financial planning: the case of Ukrainian railways

1.
Department of Finance and Credit, State University of Infrastructure and Technologies, 19, Ivana Ohienka str., Kyiv, 03049, Ukraine
2.
Department of International Economic Relations, Vasyl’ Stus Donetsk National University, 4, Akademika Yangel str., Vinnytsa, 21007, Ukraine
3.
Department of Economics, National Transport University, 1, Mykhayla Omelyanovycha-Pavlenka str., Kyiv, 02000, Ukraine

Received: 04 May 2020 Accepted: 28 June 2020 Published: 02 July 2020
JEL Codes: O21, D80, C53, L92

The crisis in the global and national economies negatively affects the predictability of companies. In such conditions, it becomes impossible to correctly forecast and plan based on the traditional methods and models. Therefore, the aim of this study is to develop an approach to forecasting and planning in conditions of high uncertainty in the functioning of companies. The methodological basis of the study is evolutionary-institutional management, which allows to consider the development of the company as a complex evolutionary process. A scenario approach is used as the basis for forecasting, which allows to study the dynamics of any company in an unstable environment. The study includes three blocks: developing scenarios, scenario forecasting, financial planning. The study is conducted based on data on the functioning of Ukrainian Railways, JSC, which is the operator of the rail infrastructure and the national carrier of goods and passengers in Ukraine. Scenarios are developed considering the specifics of the products of rail companies and based on factors (key uncertainties) that determine the effectiveness of their functioning. Scenario forecasting is based on considering the peculiarities of the company's production process, its cash cycle, and the formation of financial resources. As a result, forecast estimates are obtained for three scenarios (optimistic, pessimistic, and negative). The financial planning model is developed as a system of interrelated models of cash flow planning (operational, investment and financial). This approach allows to plan the sources of funds of the company and their use, taking into account possible changes in the external and internal environment of the company and, as a result, ensure its stable functioning in the implementation of any scenario.

Keywords:

Citation: Olha Kravchenko, Nadiia Bohomolova, Oksana Karpenko, Maryna Savchenko, Nataliia Bondar. Scenario-based financial planning: the case of Ukrainian railways[J]. National Accounting Review, 2020, 2(3): 217-248. doi: 10.3934/NAR.2020013

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Abstract

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