Ensuring financial sustainability of farms in Uzbekistan

Introduction . In a known market economy, farms tend to use the limited resources available. This is because of the slight negligence of farms in such conditions can lead to the loss of financial resources. Efficient use and management of financial resources on farms is one of the most important tasks today.

The third priority of the Action Strategy for the five priority areas of development of the Republic of Uzbekistan in 2017-2021 is called "Priorities for economic development and liberalization", which includes the development of financial and lending standards. [1].

The broad introduction of market relations in Uzbekistan and radical improvement of mechanisms of financing and mutual settlements in agriculture, on this basis, to improve the financial and economic condition of agricultural producers and their service structures, increase profitability, ensure sustainable growth of production, diversify production. The emphasis on development has made the issue of improving working capital management one of the most pressing issues [2].

The urgency of this problem is primarily since the development of production on farms should be based on market demand, not on the state order. This is because the main requirement of the Uzbek government is that farms should be able to generate additional funds or income through diversification - the development of new production sectors. The income should serve to ensure the financial sustainability of farms. Financial stability, on the other hand, requires the formation of a new structure of working capital and its management based on the principles of a modern market economy. This is a new problem for many farms operating in the country, and failure to study it promptly will lead to the bankruptcy of financial enterprises and their financial incapacity. Therefore, the study of this problem and the development of scientifically based recommendations and conclusions on it is one of the current research topics of scientific and practical importance today.

As a result of the development of the farming leaning, more than 160,000 farms have been formed in the country in recent years, and today they are effectively operating in more than 10 areas. The most gratifying thing is that more than 12,000 heads of farms are under 30 years old, and more than 6,000 farms are headed by women. Multi-sector farms have increased by 45 percent in the last two years, bringing their number to 75,000 today. Only because of this, hundreds of thousands of new jobs have been created in places, in remote villages. As a result of economic reforms and the development of the farming movement, 8,377,000 tons of grain have been grown in the country this year. [3]

The Land Code, the Law “On Farming”, the Decree of the President of the Republic of Uzbekistan dated October 27, 2003 “On the Concept of Farm Development in 2004-2006”, the Law “On Farming in Uzbekistan” Decree of the President of the Republic of Uzbekistan dated February 28, 2018 No PP-3575 "On arrangements to radically improve the system of financing the cultivation of raw cotton and grain" and many other legislative acts were adopted [2].

Financial privileges and facilities are provided to enterprises operating in the agricultural sector. As a result, the position of these enterprises in the production of agricultural products is maintained at a reasonable level, and favorable conditions are created to ensure financial stability [4].

Research methodology. The development of diversified production opens up opportunities for farms to use working capital. However, the financing of new types of production and ensuring its efficiency requires farm managers to develop its normative levels based on the forecast of future profits, depending on the level of productivity of factors of production. At the same time, taking into account the fact that the normative levels adopted in science, ie the coefficients are adapted to the activities of industrial enterprises, require farms to study based on the characteristics of crops or industries.

Today, the farms operating in Uzbekistan are engaged not only in the production of agricultural products but also in the storage, processing, and packaging of agricultural and livestock products, as well as in the supply and demand of consumers in rural areas. It should be noted that the provision of services further increases the financial stability of the economy. One of the important tasks facing farms in the current situation is to form an optimal amount of current assets. Farms are highly dependent on climatic and environmental conditions, and they must be provided with current assets and use them effectively. Because the implementation of agro-technical measures, delays in the cultivation and sale of products is directly related to the organization of working capital, planning, and financing, as well as the provision of farm management with accounting data.

The financial condition of business entities is a complex concept that reflects the interconnectedness of all elements of the financial relations that arise in the course of its economic and commercial activities. The financial condition of business entities is characterized by the sources of placement and use of funds and their formation. To determine the financial position, a financial analysis is conducted, which includes: - express analysis of financial condition (analysis of the structure of assets and liabilities, the state of property, reserves and expenses);

• -    financial stability analysis;

• -    analysis of financial results of activities;

• -    analysis of profitability and business activity.

The financial condition of business entities is also characterized by a set of indicators that reflect the process of formation and use of national resources. The results of financial and economic activities are not only in the focus of attention of business entities, workers and employees, but also in the spotlight of its business partners, the state, financial, tax authorities and others. All this increases the importance of conducting an analysis of the financial condition of business entities and its importance in economic processes.

The purposes of financial analysis are:

• -    identification of changes in a financial position as well as factors affecting sustainability;

• -    assessment of qualitative and quantitative changes in the financial situation;

• -    assessment of the financial condition of business entities for a particular item;

• -    identification of the main directions of changes in the financial situation and others.

The analysis of the financial condition determines and evaluates the profitability of the product sold by business entities, its working capital, financial stability, balance sheet liquidity, solvency and creditworthiness.

Ensuring the financial stability of the enterprise is of particular importance in determining the economic parameters of the enterprise, including financial parameters (indicators), their analysis. To do this, it is necessary to use a system of indicators.

Financial stability and its provision first, describes not only the capital structure of individual farms but also the financial condition of farms as a whole;

• -    Secondly, it is a complex indicator of the activity of farms, based on the profitability and repayment of debts, the ability of farms to finance their activities, and the rapid development of resource turnover;

• -    Thirdly, it reflects the results of production and financial activities of farms and reflects the systemic process of harmonization of these results, taking into account the feedback between them;

• - Fourth, it provides the highest return on investment through the management of the working capital of farms.

From the approaches to financial stability and its provision and assessment in the economic literature, it can be concluded that the financial justification of financial stability and its provision and the classification of its indicators requires an approach based on the specific characteristics and specialization of the object. Based on the specific characteristics of farms, it is expedient to classify financial stability and its provision into absolute and relative indicators (financial ratios).

It is expedient to interpret the system of absolute indicators of financial stability and its provision as a surplus or shortage of sources of funds that form reserves and costs, which arise in the form of the difference between the volume of reserves and expenditures.

In order to provide a broader picture of the financial condition of farms, in addition to the absolute indicators to assess the financial stability of farms and its security: absolute liquidity ratio; solvency ratio (current liquidity); financial independence ratio; own and borrowed capital ratio; own working capital ratio; turnover ratio of receivables; turnover ratio of accounts payable; balance sheet profit margin ratio; it should be limited to coefficients such as the net profit margin.

Through the above-mentioned absolute and relative indicators of financial stability and its provision, it is possible to rationally assess the financial stability of farms, which play an important role in ensuring the financial stability of farms, developing and implementing organizational and economic mechanisms.

Conclusions. Based on the above, it should be noted that today in Uzbekistan in ensuring the financial stability of farms it is necessary to increase the level of use of fixed and circulating assets and their economic efficiency, as well as the effective use of an appropriate system of indicators. At present, the level of use of fixed and circulating assets, their efficiency does not fully meet the demand. Because farms with low levels of fixed assets are not fully provided with them, incentives for their use are weak. To increase the level and efficiency of their use, it is necessary to provide farms with such tools in full and in proportion, to increase the serviceability of fixed assets, to use them wisely throughout the year, to improve financial incentives, to develop their market.