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Assessing the usefulness of accounting information as an instrument to predict business failure in Spanish cooperatives

Author

Listed:
  • Mari-Vidal, Sergio
  • Segui-Mas, Elies
  • Marin-Sanchez, Maria del Mar
  • Mateos-Ronco, Alicia

Abstract

Accounting information has been employed in many economic-financial models applied to registered corporations to predict business failure. Nonetheless, there are practically no research works that predict failure in agricultural cooperatives. The fundamental elements of this legal form justify the development of specific prediction models. The Delphi methodology has been used to define agricultural cooperative failure and to assess the usefulness of accounting variables. The conclusions suggest considering those agricultural cooperatives with negative equity or cash-flow problems to be failures or to come close to this concept. Similarly, indebtedness volume, cash flow and solvency are the most relevant variables that can act as business prediction instruments.

Suggested Citation

  • Mari-Vidal, Sergio & Segui-Mas, Elies & Marin-Sanchez, Maria del Mar & Mateos-Ronco, Alicia, 2012. "Assessing the usefulness of accounting information as an instrument to predict business failure in Spanish cooperatives," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 128561, International Association of Agricultural Economists.
  • Handle: RePEc:ags:iaae12:128561
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    File URL: http://purl.umn.edu/128561
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    References listed on IDEAS

    as
    1. 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.
    2. Dambolena, Ismael G & Khoury, Sarkis J, 1980. " Ratio Stability and Corporate Failure," Journal of Finance, American Finance Association, vol. 35(4), pages 1017-1026, September.
    3. repec:bla:joares:v:22:y:1984:i::p:59-82 is not listed on IDEAS
    4. Scott, James, 1981. "The probability of bankruptcy: A comparison of empirical predictions and theoretical models," Journal of Banking & Finance, Elsevier, vol. 5(3), pages 317-344, September.
    5. repec:bla:joares:v:4:y:1966:i::p:71-111 is not listed on IDEAS
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    More about this item

    Keywords

    Agricultural cooperatives; business failure; Delphi method; accounting variables; Agribusiness; Farm Management; Risk and Uncertainty; Q13; M41; M15; G33;

    JEL classification:

    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M15 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - IT Management
    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation

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