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Success of prediction models in Slovak companies

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  • Ivana Podhorska

    (University of Zilina, Slovak Republic Author-2-Name: Maria Misankova Author-2-Workplace-Name: "University of Zilina, Slovak Republic ")

Abstract

"Objective � The issue of bankrupt of company is very actual topic not only in Slovakia but also in abroad. The reason is that many companies have problem with the question of their probability of default or bankrupt and also with their financial health as a whole. This paper deals with the issue of prediction models and captures the applicability of these models in the Slovak conditions. Methodology/Technique � In this paper are applied eight selected prediction models in the sample of 74 companies from Slovak Republic. In addition, this paper calculated one financial ratio from the category of company�s indebtedness. Based on this calculation is done the comparison between results of predictions models and results of indebtedness financial ratio. Findings � They tested eight different prediction models and their findings present that best results were achieved by Fulmer, Poznanski and Zmijewski model. Weak results achieved IN05, CH-index and Sharita model. Novelty � This paper provides explanatory ability and success of individual prediction models in Slovak conditions."

Suggested Citation

  • Ivana Podhorska, 2016. "Success of prediction models in Slovak companies," GATR Journals gjbssr446, Global Academy of Training and Research (GATR) Enterprise.
    • Handle: RePEc:gtr:gatrjs:gjbssr446
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    References listed on IDEAS

    as
    1. Beaver, Wh, 1966. "Financial Ratios As Predictors Of Failure," Journal of Accounting Research, Wiley Blackwell, vol. 4, pages 71-111.
    2. Edward I. Altman, 1968. "Financial Ratios, Discriminant Analysis And The Prediction Of Corporate Bankruptcy," Journal of Finance, American Finance Association, vol. 23(4), pages 589-609, September.
    3. Edward I. Altman, 1968. "The Prediction Of Corporate Bankruptcy: A Discriminant Analysis," Journal of Finance, American Finance Association, vol. 23(1), pages 193-194, March.
    4. Zmijewski, Me, 1984. "Methodological Issues Related To The Estimation Of Financial Distress Prediction Models," Journal of Accounting Research, Wiley Blackwell, vol. 22, pages 59-82.
    5. Beaver, Wh, 1966. "Financial Ratios As Predictors Of Failure - Reply," Journal of Accounting Research, Wiley Blackwell, vol. 4, pages 123-127.
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    Cited by:

    1. Mahfuzur Rahman & Cheong Li Sa & Md. Abdul Kaium Masud, 2021. "Predicting Firms’ Financial Distress: An Empirical Analysis Using the F-Score Model," JRFM, MDPI, vol. 14(5), pages 1-16, May.

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    More about this item

    Keywords

    Prediction Models; Financial Health; Bankrupt; Non-Bankrupt; Indebtedness Financial Ratio.;
    All these keywords.

    JEL classification:

    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation
    • I19 - Health, Education, and Welfare - - Health - - - Other
    • K35 - Law and Economics - - Other Substantive Areas of Law - - - Personal Bankruptcy Law

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