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Paper Information

Journal:   MANAGEMENT RESEARCH IN IRAN (MODARES HUMAN SCIENCES)   SPRING 2012 , Volume 16 , Number 1 (74); Page(s) 149 To 165.
 
Paper: 

PREDICTION OF FINANCIAL DISTRESS BASED ON MULTIVARIATE DISCRIMINANT AND EFFECTIVENESS OF EFFICIENCY SCORE IN IMPROVING THE OF MODEL

 
 
Author(s):  MOUSAVI SHIRI MAHMOUD*, TABARESTANI MOHAMAD REZA
 
* DEPARTMENT ACCOUNTING, PAYAME NOOR UNIVERSITY, MASHHAD, KHORASAN RUZAVI, IRAN
 
Abstract: 

In this research, Multivariate Discriminant Analysis was used as an effective model for pridiction of financial distress and the ability of efficiency in improvement of model was assessed. At the first, financial distress prediction model was designed based on Multivariate Discriminant Analysis by financial ratios variables of sample corporations during 1999 - 2008. Then, for specifying the ability of efficiency score variable in prediction of financial distress, we designed financial distress prediction model based on Multivariate Discriminant Analysis with financial ratios and efficiency score. The results showed that models are able to predict financial distress of production corporations in Tehran stock exchange two years prior to its occurrence. The results of two models and their comparison showed that, although efficiency score variable can make better the results of financial distress prediction model, however the difference between the accuracy of predictions of financial distress in two models is not meaningful.

 
Keyword(s): EFFICIENCY SCORE, FINANCIAL RATIOS, MULTIVARIATE DISCRIMINANT ANALYSIS, FINANCIAL DISTRESS
 
References: 
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