Usage of static and dynamic control charts in company financial proceeding

Abstract

We will deal with company financial proceeding using statistical process control in this paper. Especially, we will use Shewhart's control charts operating with the constant mean and also control charts with non-constant mean and finally process capability indices. We will need to define the center line, UCL and LCL for the control chart construction. The regulated process is not allowed to cross the UCL and LCL boundaries. We will use an Altman's model for this construction as the most popular index of company financial stability (so called Z-score). We will demonstrate described situation on two case studies. The first one will be focused on financial flow regulation for one company. The second one will describe situation for six companies. Two special types of control charts (CUSUM and EWMA) will be introduced towards the end of this paper. These charts are sensitive on the mean shift. The practical applications will be displayed on two case studies. We would like to point out that the control charts can be used not only in manufactoring but also in company financial proceeding.