Bankruptcy Prediction: To what Degree does Past Development Count?

Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F00216305%3A26510%2F16%3APU121450" target="_blank" >RIV/00216305:26510/16:PU121450 - isvavai.cz</a>
Result on the web
<a href="http://wseas.org/wseas/cms.action?id=12125" target="_blank" >http://wseas.org/wseas/cms.action?id=12125</a>
DOI - Digital Object Identifier
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Result language
angličtina
Original language name
Bankruptcy Prediction: To what Degree does Past Development Count?
Original language description
Abstract: In most cases, bankruptcy models are based on financial indicators (so called predictors) that describe a current condition or a certain area of financial health, like profitability, indebtedness and so on. But they do not tell us anything about relevant past development in this area. The main question of the research presented was, how much of the information about the past development could be useful in predicting bankruptcy. The aim of our research is to analyse the partial potential of financial ratios for predicting bankruptcy and to compare their importance with the importance of commonly used indicators. Twenty eight indicators were examined in a sample of construction companies operating in the Czech Republic, as well as their development over the past five periods. The non-parametric Boosted Trees method was used to evaluate the relative importance of predictors. The results show that the indicators describing past development could be a significant predictor of bankruptcy, however their main potential is in possible synergy with the indicators describing the current state, both being of the same area of financial health.
Czech name
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Czech description
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Publication year
2016
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

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