Financial and Economic Activity
This domain checks whether a first head can read their own numbers and recognise insolvency risk early. It mixes financial analysis, planning, procurement discipline and bankruptcy law.
Diagnostic ratios
Current liquidity = current assets / current liabilities, with a normative benchmark of at least 2.0 in Kazakh practice. Autonomy (equity / total assets) should be at least 0.5. Add profitability of sales, asset turnover and debt/EBITDA. Ratios mean something only against the sector and the company's own trend.
Planning and control
A business plan links the market forecast to production, staffing and finance; budgeting sets limits; plan-fact analysis explains deviations. Procurement by state bodies and the quasi-public sector follows Law No. 434-V, while private companies apply their own rules - but the first head stays accountable for justification and documentation.
Insolvency
Under the Law on Rehabilitation and Bankruptcy (No. 67-VI of 7 March 2014) a legal entity is insolvent when it fails to meet obligations for three months from the due date. A first head who conceals the situation risks subsidiary liability for the company's debts, and deliberate or false bankruptcy is a criminal offence.
Worked example
Current assets 180 mln, current liabilities 120 mln: ratio 1.5, below the 2.0 benchmark. Inventory of 60 mln has not moved for a year; quick ratio = 120 / 120 = 1.0. The correct reading is not "above one, therefore healthy" but "liquidity depends on slow-moving stock" - a warning to the board.
Traps
Counting overdue receivables as liquid assets; equating profit with cash; treating a positive ratio as a guarantee; planning without working capital.