Forecasting corporate bankruptcy constitutes an integral and relevant part of financial statement analysis and business valuation. Typically the evaluation of a risk of financial default is based on some ratios, including company's indebtedness. However, there are various versions of such...

This paper addresses the theoretical foundations of corporate failure prediction, using the neo-classical theory of capital structure as a starting point. The paper intends to demonstrate the feasibility of such an approach in a simple setting, i.e. by using a simple theoretical model and a...

Poor corporate governance can damage the interests of shareholders, and may lead to company collapse. Previous studies in credit risk prediction provide no consensus as to which and how corporate governance variables determine bankruptcy. This paper is the first to apply a discrete time hazard...

Previous research claims that industry-relative financial ratios are more stable than unadjusted ratios. Yet, most bankruptcy studies continue to use unadjusted financial ratios to develop bankruptcy-prediction models. In re-examining whether industry-relative ratios are actually more stable, we...

This research examines how startup founders' academic knowledge, and knowledge gained through startup founding experience, signal investors and attract investments. We further examine, for both financed and non-financed startups, whether these signals are associated with the startup's...

We estimate and test several default risk models using new and unique data on corporate defaults in the German stock market. While defaults were extremely rare events in the 1990s, they have been a characteristic feature of the German stock market since the early 2000s. We apply the structural...

The purpose of this paper is firstly to review the literature on the efficacy and importance of the Altman Z-Score bankruptcy prediction model globally and its applications in finance and related areas. This review is based on an analysis of 33 scientific papers published from the year 2000 in...

Objective – This study aims to examine the risk of bankruptcy among SMEs to determine whether there are any significant differences in the financial performance between SMEs that apply accounting standard and those that do not.Methodology/Technique – This research uses a case study method to...

The aim of a warning forecast is to signal “early enough” unfavorable changes in selected business activity areas, described by time series. A warning forecast is, by nature, a long-term forecast; its characteristic feature is the fact that it does not give values of forecasted variables but...