G32 - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; GoodwillReturn

Objectives: To evaluate the performance of independent pharmacies in the Czech Republic based on analysis of the latest available financial data of the sample of pharmacies. Methods: The comparative analysis of pharmacies and their financial indicators in the period from 2013 to 2017 in a randomly selected sample. Results: Randomly selected sample includes nine micro-enterprises; one pharmacy operated in the commercial centre; a polyclinic pharmacy and eight community pharmacies. The company-specific table contains nineteen figures, seven ratios and three growth rates. Conclusion: A review of performance in the independent pharmacy segment based on financial results shows good financial status in most pharmacies examined. Seven companies in the sample have performed very well. Reducing personnel costs in the other two can achieve a balanced or profitable economy. Only one of the pharmacies is over-indebted and threatened by insolvency. The perspectives of operating independent pharmacies seem to be positive based on historical results and expected changes in the near future. Key words: Pharmacies, Financial management, Economic competition. JEL classification: G32, I11, M21, M41

Financial earning from dividends and profit shares are important income for the owners. From the business corporation perspective is the setting of dividend policy important for keeping the financial stability and solvency of the corporation. The most important indicator of the financial performance of the corporation is the profit reached. Czech accounting rules allow to account some revenue and expenses of on the basis of estimates so that all expenses and revenue are accounted in the period which is related in matter and time. These items are often a means for creative distortion of the economic result with the aim to reach the required level of covenants that lead to payment of benefits, directors rewards and annuals rewards for the management and also for the overvaluating of the economic result as one of the variables for the calculation base for the payment of dividends. Current legislation for setting the calculation base for the payment of dividends is not satisfactory and does not protect against disproportional outflow of financial means in the form of dividends for the owners. The paper concentrates on the possibility of identifying the distortion of the calculation base for the payment of dividends and on the proposal of a modification of the calculation base for the payment of dividends which would respect the legal right of the owners but also protect the financial stability of the business corporation and ensure its growth during its existence and to limit the outflow of money abroad. Key words: calculation base for the payment of dividends, net profit, payment ratio, modified reporting, NTEDP (net total earning for dividend payments), tests of profitability and own capital, accounting.