We develop a model to predict bankruptcies, exploiting that negative book equity is a strong indicator of financial distress. Accordingly, our key predictor of bankruptcy is the probability that future losses will deplete a firm's book equity. To calculate this probability, we use earnings...

Corporate misconduct is a huge and widespread problem in the economy. Many companies make mistakes that result in them having to pay penalties or compensation to other businesses. Some of these cases are so serious that they take a toll on a company’s financial condition. The purpose of this...

This book comprises 19 papers published in the Special Issue entitled "Corporate Finance", focused on capital structure (Kedzior et al., 2020; Ntoung et al., 2020; Vintilă etal., 2019), dividend policy (Dragotă and Delcea, 2019; Pinto and Rastogi, 2019) and open-market share repurchase announcements (Ding...

Globally, the unravelling of the corporate scandals leading to big multinational firms stumbling down to bankruptcy suits caused enormous loss of wealth to the investors. This study explores how the earnings management and capital structure can signal an early stage of the distressed financial...

Despite the copious number of statistical failure prediction models described in the literature, testing of whether such methodologies work in practice is lacking. This paper examines the performance of the same companies with solvency for predicting bankruptcy and comparison in both models....