Capital Structure of an Enterprise Compared to Its Financial Security on the Basis of the Telecommunication Industry in Poland
Purpose: The aim of the paper is to verify a hypothesis stating that entities form the highly capital-intensive industries are more prone to the loss of financial security including loss of liquidity. Design/Methodology/Approach: the asset to capital structure analysis as well as the study of the interrelations in the scope of financial security and short-term liquidity, has been based on the data collected in telecommunication industry enterprises which are listed on Warsaw Stock Exchange. Findings: the formulated hypothesis has been positively verified. Telecommunication industry enterprises, although not being homogenous, are characterised by several similarities regarding capital structure and its consequences, it especially regards their influence on the potential financial security of the enterprises. The evaluation of their potential financial security is negative. Practical implications: The research conducted indicates that the higher the share of fixed assets in total assets, the more difficult it is for an enterprise to keep the required asset to capital proportions and therefore it needs to be more careful in monitoring its financial situation, especially its financial liquidity. Originality/value: A high risk, capital-intensive business may strengthen the sector monopoly tendencies, which needs to be constantly monitored by appropriate state institutions.