How would I apply the viability of a 3-5 year plan, stress test under scenarios of...

How would I apply the viability of a 3-5 year plan, stress test under scenarios of adversity, and current financing plan? What would I look into? What key factors should be included?

Expert Solution

viability of 3-5 year plan

It is one of the step of assessing the future financial health of a firm. For this there must be firm's debt and equity meet with the debt policy of a firm and over the next three to 5 years there must be mix of investment needs of the firm with the financial capabiliies of the firm which also includes its strategies and goals.

Stress test under scenarios of Adversity.

Stress test meet the firm's expectations which helps in assessing the future financial health of a firm. A stress test is conducted-

1. To check the flow of funds to strategic programs can be maintained in times of adversity.

2. To check the sound behaviour of 3-5 year plan.

3. To meet the firm's expectations.

4. To reduce the effect of negative occurrence due to adversity.

Current Financing Plan

This step of assessing the future financial health of a firm considers the finance plan of the current year. This is done to balance the future financing benefits, which can be completed by selling the equity. Also a balance can be maintained based on future forecasting and market conditions.

It provides a great tool while assessing the long term health of the business with the proper understanding of the long term goals of the firm, management efficiencies, operational activites, regulatory guidelines and competition

jeff jeffy answered 2 years ago

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