Prediction of financial distress companies on bursa Malaysia : an examination of PN17 companies
( under the provisions of Practice Note 17, issued by the Bursa Malaysia on 3 January 2005, 31 public listed companies as of 5 April 2008, after fulfilling the criteria ofPN17, were classified as financially distressed companies. The failure or bankruptcy of financially distressed companies is a...
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| Main Author: | |
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| Format: | Thesis |
| Language: | English |
| Published: |
2010
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| Subjects: | |
| Online Access: | http://ir.unimas.my/id/eprint/9041/3/Chhoa%20Siew%20Phin%20ft.pdf |
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| Summary: | ( under the provisions of Practice Note 17, issued by the Bursa Malaysia on 3 January
2005, 31 public listed companies as of 5 April 2008, after fulfilling the criteria ofPN17,
were classified as financially distressed companies. The failure or bankruptcy of
financially distressed companies is a serious threat to the many economic agents
holding an interest in the distressed companies, namely; shareholders, managers,
employees, bankers and clien~ Business failure involves not only many parties but
large cost (both direct and indirect) as well. The main purpose of this paper is therefore
to use financial variables to predict potential financially distressed firms using the
logistic regression model. Then the predictive ability of the prediction model was
analysed and the findings are encouraging and consistent for the sample analysed and
the period of study. The results demonstrate that profitability; liquidity and leverage
ratios are among the most significant ones. |
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