Performance Comparison of Multiple Discriminant Analysis and Logit Models in Bankruptcy Prediction

Mihalovič, Matúš

doi:10.14254/2071-789x.2016/9-4/6

Cited by 76 publications

(69 citation statements)

References 35 publications

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“…A logit model based on three measures related to taxation generated much better prognostic results than single measures but it failed to provide a guarantee of efficiency higher than in the case of models including other financial measures. Mihalovic (2016) built two national models based on a linear multi-dimensional discriminatory analysis and logit analysis using a balanced sample of 236 bankrupt and non-bankrupt enterprises. As explanatory variables, financial indicators were used.…”

Section: Slovakiamentioning

confidence: 99%

Review of Research into Enterprise Bankruptcy Prediction in Selected Central and Eastern European Countries

Prusak

2018

IJFS

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Abstract:In developed countries, the first studies on forecasting bankruptcy date to the early 20th century. In Central and Eastern Europe, due to, among other factors, the geopolitical situation and the introduced economic system, this issue became the subject of researcher interest only in the 1990s. Therefore, it is worthwhile to analyze whether these countries conduct bankruptcy risk assessments and what their level of advancement is. The main objective of the article is the review and assessment of the level of advancement of bankruptcy prediction research in countries of the former Eastern Bloc, in comparison to the latest global research trends in this area. For this purpose, the method of analyzing scientific literature was applied. The publications chosen as the basis for the research were mainly based on information from the Google Scholar and ResearchGate databases during the period Q4 2016-Q3 2017. According to the author's knowledge, this is the first such large-scale study involving the countries of the former Eastern Bloc-which includes the following states: Poland, Lithuania, Latvia, Estonia, Ukraine, Hungary, Russia, Slovakia, Czech Republic, Romania, Bulgaria, and Belarus. The results show that the most advanced research in this area is conducted in the Czech Republic, Poland, Slovakia, Estonia, Russia, and Hungary. Belarus Bulgaria and Latvia are on the other end. In the remaining countries, traditional approaches to predicting business insolvency are generally used.

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Section: Slovakiamentioning

confidence: 99%

Review of Research into Enterprise Bankruptcy Prediction in Selected Central and Eastern European Countries

Prusak

2018

IJFS

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“…In the study of Mihalovič [70], author focuses on the comparison of overall prediction performance of the two developed models, discriminant analysis and logistic regression, in conditions of the Slovak Republic and he reveals the most significant predictors net income to total assets, current ratio and current liabilities to total assets Considering the studies on the most commonly used variables of the prediction models we can claim, that the statistically significant variables in the model of corporate prosperity belong to the group of variables, which are accepted by experts in this field. Mousavi et al [71] conclude that the choice and design of independent variables and their nature affect the overall performance of the model.…”

Section: Discussionmentioning

confidence: 99%

Financial Risk Measurement and Prediction Modelling for Sustainable Development of Business Entities Using Regression Analysis

et al. 2018

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Abstract:The issue of the debt, bankruptcy or non-bankruptcy of a company is presented in this article as one of the ways of conceiving risk management. We use the Amadeus database to obtain the financial and accounting data of Slovak enterprises from 2015 and 2016 to calculate the most important financial ratios that may affect the financial health of the company. The main aim of the article is to reveal financial risks of Slovak entities and to form a prediction model, which is done by the identification of significant predictors having an impact on the health of Slovak companies and their future prosperity. Realizing the multiple regression analysis, we identified the significant predictors in conditions of the specific economic environment to estimate the corporate prosperity and profitability. The results gained in the research are extra important for companies themselves, but also for their business partners, suppliers and creditors to eliminate financial and other corporate risks related to the unhealthy or unfavorable financial situation of the company.

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“…Ghilic-Micu et al (2016) pay attention to the fact that logistical modelling is an essential factor for supporting managerial decisions in contemporary business systems. At that the term "logistical modelling" as "logistical regression" is a certain development of logic as a science about features and methods of thinking (Mihalovič, 2016). However in a significant sense they are not equal.…”

Section: Methodsmentioning

confidence: 99%

Logistical modelling of managerial decisions in social and marketing business systems

Velychko

2017

Journal of International Studies

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Abstract. Logistical modelling of business systems within the context of mathematical logistics, logistical management, operational research as well as rationalistic provision of logistics at an enterprise have been considered in the article. The research was carried out on the methodological basis which included the authors' developments and implied conveying familiar knowledge on new objects within the field of linear programming. Scientific novelty concerns the development of categorical toolkit as well as the existing methodical approaches of rationalistic logistics to managerial decisions. Rational areas of using terms "logistical model" and "model of logistics" in business environment have been determined. The authors' methodology of constructing logistical models in management of separate social and marketing systems of enterprises according to minimization and maximization criteria is presented. Ways of using modelling at not conventional objects of logistical support for managerial decisions have been suggested in the context of studying the moral psychological climate of staff and complex estimation of socioeconomic measures of staff management improvement. The procedure of logistical optimization in the system of distributing and advertising activity of the enterprise has been developed. Approbation of the developed models has been carried out and possibilities for further model's complication by output data, variables, and limitations under specific practical conditions have been grounded.

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Performance Comparison of Multiple Discriminant Analysis and Logit Models in Bankruptcy Prediction

Cited by 76 publications

References 35 publications

Review of Research into Enterprise Bankruptcy Prediction in Selected Central and Eastern European Countries

Review of Research into Enterprise Bankruptcy Prediction in Selected Central and Eastern European Countries

Financial Risk Measurement and Prediction Modelling for Sustainable Development of Business Entities Using Regression Analysis

Logistical modelling of managerial decisions in social and marketing business systems

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