The Timescale Effects of Corporate Governance Measure on Predicting Financial Distress

2008 ◽  
Vol 11 (01) ◽  
pp. 35-46 ◽  
Author(s):  
Hsin-Hung Chen
Keyword(s):  
Corporate Governance ◽  
Logistic Regression ◽  
Regression Model ◽  
Financial Distress ◽  
Logistic Regression Model ◽  
Historical Data ◽  
Stock Exchange ◽  
Taiwan Stock Exchange ◽  
Prediction Horizon ◽  
The Empirical Analysis

This study aims to investigate the timescale effects of the corporate governance measure on predicting financial distress of corporations. A new corporate governance measure is adopted in the logistic regression model. Historical data of the companies listed on the Taiwan Stock Exchange Corporation (TSEC) were used in the empirical analysis. The analysis was based on three different prediction horizons comprising one-, two- and three-year horizons. The results confirmed that the accuracy of the logistic regression model for predicting corporate financial distress can be improved by incorporating the corporate governance measure. Moreover, the improvements of the correct rate for classification by incorporating the corporate governance measure increased as the prediction horizon was raised. The improvements of the correct rate for classification by incorporating the corporate governance measure are 2.9%, 4.4% and 5.8% for "Year 1", "Year 2" and "Year 3" models respectively.

Are Disasters Disastrous to Nonprofit Organizations? Investigating the Financial Implications of Hurricane Sandy for Nonprofits

2021 ◽  
pp. 089976402199845
Author(s):  
Xintong Chen
Keyword(s):  
Logistic Regression ◽  
Regression Model ◽  
Nonprofit Organizations ◽  
Financial Distress ◽  
Logistic Regression Model ◽  
Hurricane Sandy ◽  
Financial Health ◽  
External Funds

Nonprofit organizations are sensitive to external disasters due to their high reliance on external funds and volunteers. In this study, I investigate how disasters affect the financial health of nonprofits and what factors make them more vulnerable within the context of disaster. The sample in this study includes nonprofits directly and indirectly affected by Hurricane Sandy. Using a logistic regression model, I explore if the disaster contributed to the likelihood of a nonprofit experiencing financial distress. Disaster, as an external shock, increases risks of nonprofits experiencing financial distress, especially for smaller nonprofits and nonprofits not relying on commercial revenue.

scholarly journals Trading Volume as a Predictor of Market Movement

2019 ◽  
Vol 8 (2) ◽  
pp. 57-69
Author(s):  
Edson Kambeu
Keyword(s):  
Logistic Regression ◽  
Stock Market ◽  
Regression Model ◽  
Trading Volume ◽  
Logistic Regression Model ◽  
Predictive Analytics ◽  
Stock Exchange ◽  
Stock Market Index ◽  
Trading Volumes ◽  
Popular Language

A logistic regression model is has also become a popular model because of its ability to predict, classify and draw relationships between a dichotomous dependent variable and dependent variables. On the other hand, the R programming language has become a popular language for building and implementing predictive analytics models. In this paper, we apply a logistic regression model in the R environment in order to examine whether daily trading volume at the Botswana Stock Exchange influence daily stock market movement. Specifically, we use a logistic regression model to find the relationship between daily stock movement and the trading volumes experienced in the recent five previous trading days. Our results show that only the trading volume for the third previous day influence current stock market index movement. Overall, trading volumes of the past five days were found not have an impact on today’s stock market movement. The results can be used as a basis for building a predictive model that utilizes trading as a predictor of stock market movement.

scholarly journals Determinants of voluntary disclosure of internal control weaknesses in Tunisia

2017 ◽  
Vol 14 (2) ◽  
pp. 59-68
Author(s):  
Hamed Kharraz ◽  
Jihene Ferchichi
Keyword(s):  
Corporate Governance ◽  
Logistic Regression ◽  
Control System ◽  
Internal Control ◽  
Ownership Structure ◽  
Voluntary Disclosure ◽  
Logistic Regression Model ◽  
Stock Exchange ◽  
Internal Control System ◽  
Internal Control Weaknesses

The main objective of this research is to examine the determinants which can push the auditors to reveal the weaknesses of the internal control system in companies listed on the Stock Exchange Securities of Tunisia. We are particularly interested in determinants related to corporate governance, ownership structure and some company characteristics. The conceptual framework referred to this work is the agency theory. We concluded from the results of the logistic regression model that the probability of disclosure of internal control weaknesses was not significantly associated with corporate governance and ownership structure. However, some other company characteristics, e.g. the size are strongly related with probability of firms disclosing internal control weaknesses.

Study on Early Warning of Enterprise Financial Distress — Based on Partial Least-squares Logistic Regression

2015 ◽  
Vol 65 (s2) ◽  
pp. 3-16 ◽  
Author(s):  
Kun Xu ◽  
Qilan Zhao ◽  
Xinzhong Bao
Keyword(s):  
Logistic Regression ◽  
Regression Model ◽  
Least Squares ◽  
Partial Least Squares ◽  
Early Warning ◽  
Financial Distress ◽  
Logistic Model ◽  
Logistic Regression Model ◽  
Warning System ◽  
Study Results

Establishment of an effective early warning system can make the company operators make relevant decisions as soon as possible when finding the crisis, improve the operating results and financial condition of enterprise, and can also make investors avoid or reduce investment losses. This paper applies the partial least-squares logistic regression model for the analysis on early warning of enterprise financial distress in consideration of quite sensitive characteristics of common logistic model for the multicollinearity. The data of real estate industry listed companies in China are used to compare and analyze the early warning of financial distress by using the logistic model and the partial least-squares logistic model, respectively. The study results show that compared with the common logistic regression model, the applicability of partial least-squares logistic model is stronger due to its eliminating multicollinearity problem among various early warning indicators.

scholarly journals FINANCIAL DISTRESS DENGAN LOGISTIC REGRESSION MODEL

2018 ◽  
Author(s):  
Hasrul Siregar
Keyword(s):  
Logistic Regression ◽  
Regression Model ◽  
Financial Distress ◽  
Logistic Regression Model ◽  
Financial Leverage ◽  
Purposive Sampling

Financial distress adalah merupakan suatu periode dimana perusahaan mengalami gangguan keuangan yang terjadi sebelum perusahaan mengalami kebangkrutan. Analisis terhadap financial distress sangat perlu dilakukan sejak awal untuk mengantisipasi bangkrutnya perusahaan. Perlu dikembangkan suatu model yang menggambarkan prediksi kebangkrutan suatu perusahaan melalui analisis financial distress sebuah perusahaan. Dengan mengetahui penyebab financial distress perusahaan akan lebih bersikap lebih hati-hati dalam pengambilan keputusan keuangan. Penelitian ini bertujuan untuk menganalisis apakah-apakah faktor-faktor likuidity, financial leverage, asset utilization dan profitability dapat memprediksi financial distress perusahaan. Populasi dalam penelitian ini adalah seluruh perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia. Metode pengambilan sampel dilakukan dengan metode purposive sampling dengan beberapa kriteria yang ditetapkan.Model yang digunakan dalam penelitian ini adalah model regressi logistic yang bertujuan untuk menguji probabilitas terjadinya variabel terikat financial distress dapat diprediksi dengan variabel bebasnya yaitu likuidity, financial leverage, asset utilization dan profitabilility. Persamaan model yang dikembangkan dalam penelitian ini adalah :Y = ( FD/1-FD ) = β0 + β1X1+β2X2+β3X3+β4X4Populasi dalam penelitian ini adalah seluruh perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia berjumlah 136 perusahaan. Dengan criteria tertentu terpilih 50 perusahaan yang digunakan sebagai sampel. Periode penelitian tahun 2010 sd 2012.Hasil penelitian ini menunjukkan bahwa secara simultan likuidity, financial leverage, asset utilization, profitability dapat memprediksi kondisi financial distress perusahaan. Namun secara parsial hanya variabel asset utilization dan profitability yang mampu memprediksi kondisi kebangkrutan perusahaan.

scholarly journals Uji Model Keseimbangan Teori Keagenan: Pengaruh Kebijakan Utang dan Kebijakan Dividen Terhadap Kepemilikan Manajerial [Testing a Model of Balance Agency Theory: The Influence of Policy Liabilities and Dividend Policy towards Managerial Ownership]

2016 ◽  
Vol 11 (1) ◽  
pp. 102 ◽  
Author(s):  
Shiela Liviani ◽  
Putu Anom Mahadwartha ◽  
Liliana Inggrit Wijaya
Keyword(s):  
Logistic Regression ◽  
Regression Model ◽  
Agency Theory ◽  
Logistic Regression Model ◽  
Dividend Policy ◽  
Stock Exchange ◽  
Fixed Effect ◽  
Managerial Ownership ◽  
Trade Off ◽  
Debt Policy

<p>This study aims to analyze the balancing model of agency theory in the effect of debt policy and dividend policy to managerial ownership in manufacture sector companies, which are listed in Indonesia Stock Exchange. Companies in Indonesia tend to have concentrated ownership structure. This condition is contradictory to the previous studies which mostly done in the widely ownership-dispersed countries. Balancing model argues that there is a trade-off between each monitoring and controlling mechanism, i.e. the effect of debt policy to managerial ownership and dividend policy to managerial ownership. This study uses a quantitative approach with fixed effect logistic regression model to analyze the data. Total sample of this study is 1,060 observations of 106 listed Indonesian manufacture firms during the period of 2004-2014. This study found debt policy to be a significant and negative determinant of the level of managerial ownership, as predicted by balancing model of agency theory. This study also found dividend policy has an insignificant positive effect to the level of managerial ownership, which rejected the balancing model of agency theory in the effect of dividend policy to managerial ownership.</p><p>Penelitian ini bertujuan untuk menguji model keseimbangan teori keagenan pada pengaruh kebijakan utang dan kebijakan dividen terhadap kepemilikan manajerial dalam perusahaan sektor manufaktur yang terdaftar di Bursa Efek Indonesia. Struktur kepemilikan dalam perusahaan-perusahaan di Indonesia cenderung terkonsentrasi. Kondisi ini berbeda dengan penelitian terdahulu yang banyak dilakukan di negara yang struktur kepemilikannya cenderung tersebar. Model keseimbangan menyatakan bahwa terdapat <em>trade-off</em> antar suatu mekanisme pengawasan dan pengendalian dengan mekanisme lainnya, yaitu pengaruh kebijakan utang terhadap kepemilikan manajerial dan kebijakan dividen terhadap kepemilikan manajerial. Penelitian ini menggunakan pendekatan kuantitatif dengan <em>fixed effect logistic regression model</em> untuk menganalisis data. Jumlah sampel yang digunakan dalam penelitian ini adalah 1.060 observasi dari 106 perusahaan sektor manufaktur di Indonesia selama periode 2004-2014. Penelitian ini menemukan bahwa kebijakan utang berpengaruh negatif signifikan terhadap tingkat kepemilikan manajerial, seperti yang diprediksi oleh model keseimbangan teori keagenan. Penelitian ini juga menemukan bahwa kebijakan dividen memiliki pengaruh positif tidak signifikan terhadap tingkat kepemilikan manajerial, yang mana menolak model keseimbangan teori keagenan dalam pengaruh kebijakan dividen terhadap kepemilikan manajerial.</p>

Pengaruh Penerapan Corporate Governance Terhadap Kondisi Kesulitan Keuangan

2018 ◽  
Vol 9 (2) ◽  
pp. 50-64
Author(s):  
Stephanus Andi Adityaputra
Keyword(s):  
Corporate Governance ◽  
Logistic Regression ◽  
Significant Influence ◽  
Financial Distress ◽  
Boards Of Directors ◽  
Audit Committee ◽  
Stock Exchange ◽  
Institutional Ownership ◽  
Managerial Ownership ◽  
Manufacturing Companies

This study examined the effect ofthe implementation of corporate governance on the condition of the financial distress of manufacturing companies listed on the Indonesia Stock Exchange (IDX). The implementation of corporate governance proxied with the proportion of managerial ownership, proportion of institutional ownership, number of the boards of directors, proportion of independent commissioners, and existence of the audit committee. Samples used in this study was manufacturing companies listed on the Indonesia Stock Exchange (IDX) with 2012 up to 2016 as an observation period. The total study samples was 48 firms with 96 firm year are determined by the method of purposive sampling. This study used Logistic Regression to examine the effect of the implementation of corporate governance of the condition of the company's financial distress. The results of this study indicated that The number of the boards of directors and the proportion of independent commissioners variables were not proven to have significant influence on the condition of the company's financial distress. The proportion of managerial ownership, the proportion of institutional ownership, and the existence of the audit committee variables proved to have a significant influence on the condition of the company's financial distress with a positive influence. Keywords: board of directors, independent commissioners, managerial ownership, institutional ownership, audit committee, financial distress, logistic regression

scholarly journals Predicting Egyptian Banks Distress

2018 ◽  
Vol 8 (3) ◽  
pp. 39 ◽  
Author(s):  
Osama EL-Ansary ◽  
Mohamed Saleh
Keyword(s):  
Logistic Regression ◽  
Discriminant Analysis ◽  
Regression Model ◽  
Data Base ◽  
Financial Distress ◽  
Prediction Accuracy ◽  
Logistic Regression Model ◽  
Predictive Accuracy ◽  
Prediction Method ◽  
Accurate Prediction

Purpose – the main purpose of the study is to investigate an accurate prediction method for banking distress applied on a set of Egyptian banks.Methodology - the researchers have compared the prediction accuracy of the discriminant analysis and logistic regression model, to choose the most appropriate one. The data has been collected from the “Bank scope” data base and for the period of 2002–2016.Findings – the results of the study revealed that the predictive accuracy of discriminant analysis outperformed that of the logistic regression model.Originality - The study adds value to the literature as it is one of the few studies that is concerned with predicating the banking financial distress especially in Egypt.

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