Research on Early Warning and Prevention of Enterprise Financial Risks

Faced with the complex changes in the global economic situation, the sustainable development of enterprises is facing severe challenges of financial risks. This study focuses on exploring the early warning mechanism and prevention strategies for financial risks. The purpose is to establish an efficient early warning mechanism to assist enterprises in accurately identifying and resolving financial crises. The research methods include literature analysis and case-based research. After reviewing relevant research on corporate financial crises worldwide, the main risk characteristics and their causes can be summarized. On this basis, by establishing an evaluation system and prediction model, it was found that using evaluation indicators that include dimensions such as debt paying ability, operating conditions, and income levels, and using multivariate statistical methods such as Z-score and Logistic, can effectively predict corporate financial crises; And targeted prevention strategies in the financing, investment, operating, and income-distribution aspects can help enterprises avoid or mitigate financial risks.