Evaluating Financial Performance of Airline Companies Through Liquidity and Debt Ratios: An Accounting Approach

Faizah Alsulami ()
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Faizah Alsulami: Department of Accounting, Faculty of Business Administration, University of Tabuk, P.O. Box 741, Tabuk 71491, Saudi Arabia

Risks, 2025, vol. 13, issue 4, 1-18

Abstract: This research indicates that accounting is essential for assessing South Asian airline companies via financial ratio analysis from 2011 to 2022. The accounting measurements delineate informing and facilitating strategic decision-making from 2011 to 2022. The analysis utilizing GARCH and PARCH models indicates that liquidity ratios have a positive impact on financial performance, supported by statistically significant evidence ( p < 0.05) under both symmetric and asymmetric conditions. Effective liquidity management and the strategic implementation of debt through accounting practices should be prioritized, as they enhance financial outcomes for South Asian airlines while adhering to long-term accounting standards. Future research should examine the responses of various airlines to these ratios, considering external factors, as this will yield valuable insights to enhance financial practices and promote aviation development in the region.

Keywords: accounting; finance; return on equity; current ratio; debt ratio (search for similar items in EconPapers)
JEL-codes: C G0 G1 G2 G3 K2 M2 M4 (search for similar items in EconPapers)
Date: 2025
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