Real capital is physical assets. They consist of working and fixed capital. What role does it play in the economy and what are the features of the analysis of real capital in it? We will talk about this and many other things in more detail in our article.
Fixed and working capital
Fixed capital and its funds are a fundamental component in all branches of real capital. At the beginning of 2011 in Russia out of 122.5 trillion rubles. of all economic assets 93 trillion. rub. accounted for precisely the fixed assets.
Fixed capital funds cover short-term assets with a service life of no more than one year. These include such material objects as buildings, structures, housing, transmission devices, equipment, machinery, machines, tools and inventory, means of transportation, perennial plantings and livestock, ownership of leases and intellectual property. The latter include logos, trademarks, licenses, etc.
Working capital is the second part of real capital, which consists ofmaterial working capital. These include inventories associated with production. As well as work-in-progress itself, finished goods and goods that were in use and ready for resale.
Working capital and finance, profit
Finance also has working capital. These are settlement funds of suppliers and buyers, for example, receivables, which include all kinds of loans and installments, as well as deferred expenses. For example, advances to suppliers, cash on hand. If we add the sum of real and financial capital, then we get a certain amount. This is the accounting definition of all working capital.
Real equity brings its owners various forms of profit:
- net - to firms;
- roy alties - to intellectual property owners.
Equity units are mainly traded on investment markets.
Analysis and nuances of fixed capital
There are two main aspects to the above analysis. First, it is its dynamics. For example, the price of fixed capital funds of the Russian Federation for 1981-1990. rose by 72%, and in 1991-2000. only by 6%. And then it was the merit of the completion of previously started projects. But in 2001-2010. there was an increase in fixed assets by 22%, although the pace decreased significantly.
Second, the aspect is the study of the nuances of fixed capital. The analysis is carried out according to the methods of activity in the economy, types of ownership, implementation andmutual substitution of fixed assets. An analysis of the sectors of fixed assets in 2011 shows that all funds were concentrated in transport and communications (26.5% of the total), housing and housing and communal services (24%), industrial sectors (26% along with utility costs).
Analysis of the key funds of the real capital market of the Russian Federation by type of ownership shows the results of general privatization at the end of the last century:
- in 1990 the state owns 91% of the total fixed fund;
- in 1996 - 28%;
- in 2008 - 22%;
- in 2011 already 47.9%.
Cost ratios
Exploitation of real capital and real funds is reflected in the renewal of fixed assets. This is the percentage of the state of fixed annual funds at the beginning of the year to their balance at the end of the year. Funds must be valued at nominal book value, that is, at depreciation prices.
Changing odds
If we compare the value of this coefficient over several years, we can say with certainty whether the introductory process of fixed assets has accelerated or slowed down. For example, in the Russian Federation, the renewal percentage was:
- in 1980 9, 1%;
- in 1990 - 6.3%;
- in 2000. level dropped to 1.8%;
- in 2001–2011 remained stable at the level of 3-4%.
It is impossible to imagine that fixed assets will be updated without a coefficientdisposal. This is a kind of percentage ratio of funds liquidated during the year to their availability at the beginning of the next billing period, calculated at the nominal value of accounting. The retirement rate of fixed assets in our country:
- was 1.9% in 1980;
- in 1990 - 2.4%;
- to this day, it remains at about 1%.
Average age of fixed assets
Summing up the results of the processes of input and disposal of fixed assets of the real capital of enterprises is impossible without such a thing as middle age. It should be noted that dwellings, structures and buildings can be maintained in proper condition for centuries with the help of major and cosmetic repairs. But equipment, machines, inventory, tools and vehicles may be in proper condition, but obsolete.
There are two types of fixed assets - active (inventory and tools) and passive (buildings and structures). The age and depreciation of active funds is more important, since modern technologies play a significant role in production. Unfortunately, it is impossible to calculate the average age of fixed assets in Russia.
But you can calculate the age of industrial facilities. For example, the average age of industrial buildings in Russia in 2008 was 26 years, structures 22 years, and machinery and industrial equipment 14 years.
Depreciation and depreciation of fixed assets
Due to the peculiarities of statistical research in our country, to calculate the depreciation of fixed assets inreal and financial capital uses such a thing as "degree of depreciation". In Russia, the following dynamics were observed:
- in 1990 it was 35.1%;
- in 2000 - 39.4%;
- in 2008 - 45.3%;
- in 2010 - 47.1%.
The degree of depreciation of fixed assets is calculated not so much from the physical side as from the moral side. It is much more important for capital to have modern tools to make work easier than new buildings.
Depreciation is a change in the price of fixed capital in the process of its use in production. And also transferring the change in this price to the finished product as a cost of production activity.
This is actually a partial annual write-off of the cost of fixed capital based on government-set prices for capital goods. From depreciation deductions, a fund is formed that serves to compensate for the depreciation of capital. Remarkably, entrepreneurs are interested in increasing the sinking fund.
Firstly, it is not taxed. Secondly, the funds of the sinking fund can be used for investment. The state is also interested in rapid depreciation, so its process is often accelerated by the enterprises themselves. Production capital is usually written off within a few years. This happens in order to update them at the expense of depreciation deductions.
In today's Russia, depreciation deductions are quite noticeable, but far fromleading source of financial investment in fixed assets. Their share in 2010 was only 20.5%.
Working capital analysis
Worth noting that working capital lives up to its name. It performs a turnover in the economy faster than the main one. And the contribution of working capital to the economy is much greater than that of the main one. This is because depreciation transfers the cost of fixed capital to finished products over several years. While working capital carries over this cost for several months.
In our country in 2007, the share of output of industrial processing for its depreciation investments accounted for only 3%. And the remaining costs, which form mainly working capital (raw materials), accounted for 73%. Labor costs accounted for 12%, while other costs related to working capital also accounted for about 12%.
