Economic justification for developing an economic security management system in agricultural enterprises

The article develops a theoretical and methodological approach to the economic justification of an economic security management system in agricultural enterprises. The study addresses the relationship between the cost of establishing and operating such a system, the expected reduction in losses, acceptable residual risk, and the availability of financial resources. Agricultural production requires particular attention to seasonal cash flows, biological production cycles and the timely funding of essential operations. The research combines systems and process approaches, comparative analysis, expected-loss modeling, discounting, and sensitivity analysis. Its theoretical basis is a targeted review of Ukrainian and international publications. A hypothetical numerical example illustrates the proposed decision-making procedure and does not represent observations from an actual enterprise. The proposed approach treats the management system as a coordinated set of economic rules, responsibilities, information flows, and response procedures. Alternative configurations are evaluated against the enterprise’s existing controls. Initial implementation expenditure, additional annual operating costs, and tied-up working capital are distinguished to avoid double counting. Benefits are measured as the expected reduction in monetary losses rather than guaranteed cash receipts. Net present value is used together with residual-loss limits and liquidity constraints. This combination allows selection of an economically justified configuration while maintaining the capacity to finance the next production cycle. The analysis compares three mutually exclusive configurations over a three-year horizon: basic, integrated, and extended. Under the stated assumptions, the integrated configuration provides the highest net present value, amounting to UAH 0.310 million, and satisfies the annual financing and expected-loss constraints. The extended configuration is more costly and provides insufficient additional benefits. Sensitivity analysis shows that a 20 percent decline in expected loss reduction makes the integrated configuration economically unattractive and breaches the assumed residual-loss limit. Its break-even annual loss reduction is approximately UAH 0.814 million. A separate seasonal cash-flow illustration demonstrates that a positive expected net present value does not guarantee sufficient liquidity at the time of implementation. The monitoring framework links financial and operational indicators to assigned responsibilities and corrective decisions. The practical contribution lies in identifying a sufficient and affordable set of management functions and protective measures. Further research may address interacting agricultural risks and the economic effects of phased implementation. Keywords: economic security, agricultural enterprises, management system, economic justification, expected losses, risk, liquidity.