Financial Distress is a problem spread all over the world from the history. Even though there are ample research studies on this area, the empirical results on this area provide inconclusive results. The majority of the research works focused only on the bankruptcy and not on the financial distress. Hence, the main purpose of this study is to develop a better financial distress prediction model for Sri Lankan companies using the Z-score model. Multivariate Discriminate Analysis (MDA) was used as the analytical technique and simultaneous estimation method has used to enter the variables in the analysis. The study has examined four accounting ratios for 134 distressed and non-distressed companies from 2002 to 2011. The study has found that the derived model which consists of four accounting ratios

Abstract

Although the required capital investments for electricity generation infrastructure from 2018 to 2037 have been projected around USD 14,568 in Sri Lanka, Ceylon Electricity Board is not in a position to meet this requirement due to its negative cash flows. Full private investments are restricted by the law stating that any person to generate capacity above and over of 25 MW, shall Government hold 51% of ownership. Since the funding of power generation is a top urgent priority in the country, this paper investigates the challenges and critical factors involved in going for a public private partnership (PPP) by reviewing the related literature in other countries and identifying main themes that Sri Lanka needs to take into account. Narrative literature review with thematic analysis revealed that 1) Political Instability, 2) State Credibility on policies, 3) Regulatory and legal framework, 4) Transparent and efficient procurement process, 5) Financial Market, 6) Favourable investment environment, and 7) a strong and good private consortium as the mostly influencing macro factors to build PPP for power generation infrastructure projects in Sri Lanka.

Purpose: The banking sector is a crucial player in any economy, often affected by economic and social crises. Thus, it is vital to identify the intrinsic weaknesses of banks to manage their operational risk. The recent COVID-19 pandemic also severely affects the global financial sector, irrespective of the development status. Accordingly, this study is an attempt to find out the evidence on operational risk management and its relationship with bank size and ownership structure of the banking sector in one of the developing countries in the world, Sri Lanka.Design/Methodology/Approach: Financial data of eight out of thirteen commercial banks in Sri Lanka were analyzed over 13 years using panel data regression analysis. Sri Lankan banks' operational risk management practices are measured by excess capital (over the required minimum capital for operational risk). Deposits plus advances are used to calculate the size of a bank.Findings: It is revealed a significant positive relationship between firm size and operational risk management. A significant relationship between the ownership and excess capital held by banks for managing operational risk is also identified. This result leads to the conclusion that the larger commercial banks hold higher excess capital over the required minimum as per Basel accords. Moreover, government-owned banks are recognized to have more excess capital for operational risk management.Implications: Given the high amount of losses from bad loans and the central bank's implementation of Basel III regulations, the study has implications for Sri Lankan banks.Originality: When considering Sri Lankan context there can be found only a little amount of evidence on operational risk management practices and its relationship with size and ownership.