scholarly journals Propensity for premature filing for judicial financial recovery in large-scale agriculture in Brazil

2021 ◽  
pp. 1-12
Author(s):  
Antonio Carlos Ortiz ◽  
Henrique Monaco ◽  
Vitor Machado ◽  
Michael Boehlje
Keyword(s):  
Incomplete Information ◽  
Financial Distress ◽  
Large Scale ◽  
Financial Statements ◽  
Negative Consequences ◽  
Agricultural Credit ◽  
Financial Condition ◽  
Complete Set ◽  
Financial Indices ◽  
Financial Recovery

In the Brazilian agricultural space, numerous cases of large farmers have declared themselves in severe financial distress and filed for Judicial Financial Recovery (JFR) in the past few years. Our statistical analysis, although preliminary and based on limited available data, indicates that these operations have shown financial indices at levels that, in general, did not significantly differ from a sample of other larger farmers’. Only ‘liquidity’ presented a more persistent relationship with the cases of Judicial Recovery. Therefore, it seems that farmers may be resorting to the JFR route prematurely. Within a limited subsample of cases of farmers who filed for JFR, data also shows a pattern with indications that farmers may tend to time their filing to coincide with having their main crops ready for commercialization immediately preceding or after harvesting. This suggests that these farmers might be seeking to free their most recent crop from previous financial and commercial commitments by pursuing a favorable court decision to their JFR. Some factors may be driving this behavior: (1) most farmers in Brazil do not produce a complete set of financial statements on accrual bases, which may lead to errors and incomplete information; (2) not all farmers’ debt is registered at the Central Bank, making debt consolidation a challenging discovery process to lenders, who may overleverage clients; (3) farm revenues are concentrated in only a few weeks of the year, allowing farmers that file for Judicial Recovery to carry on with their business, if the courts halt service of previous debt; (4) courts have also allowed these farmers to release assets from collateralized loans. In sum, there may be inaccurate interpretation of the farmers’ financial condition due to incomplete information, and a component of moral hazard motivating large farmers filing prematurely for JFR in Brazil. The number and magnitude of these cases may generate negative consequences to agricultural credit costs and availability in the future.

scholarly journals Loan Waivers and Bank Credit: Reflections on the Evidence and the Way Forward

2019 ◽  
Vol 44 (4) ◽  
pp. 198-210
Author(s):  
Sudha Narayanan ◽  
Nirupam Mehrotra
Keyword(s):  
Financial Distress ◽  
Large Scale ◽  
Banking Sector ◽  
Banking System ◽  
Well Being ◽  
Policy Instrument ◽  
Negative Consequences ◽  
Executive Summary ◽  
Long Run ◽  
Macroeconomic Implications

Executive Summary In the past decade, farm loan waivers have become a policy instrument to alleviate the financial distress of farmers. Despite agreement on the theoretical rationale for such debt forgiveness and its deep contextual relevance, many fear that in the long run, loan waivers might vitiate the repayment culture in the farm sector and undermine the financial status of banks. At present, critiques of large-scale loan waivers rest on limited evidence. This article reviews and synthesizes existing research and available data on the implications of loan waivers, especially for the flow of credit to farmers from banks. On most of the issues, such as farmer well-being and repayment culture, there seems to be mixed evidence on the consequences of debt waivers. Credible evidence on macroeconomic implications is limited, mainly on account of methodological challenges. This article concludes that even if loan waivers are an inappropriate strategy to support farm incomes in sustainable ways, the wide-ranging negative impacts on the formal banking sector are perhaps overstated. A more fruitful approach would be to focus on whether loan waivers can be designed to reduce the possible negative consequences for the formal banking system as well as for macroeconomic system. The article identifies three possible instruments—loan insurance products that will help banks cope with the consequences of large-scale defaults. Second, to explore the creation of a distress fund that will cushion state finances, should there be a need for debt waivers. Third, it would be useful to consider the operation of debt relief commissions to have an ongoing process for debt waivers.

scholarly journals PREDIKSI KEBANGKRUTAN MODEL SPRINGATE PADA INDUSTRI TELEKOMUNIKASI

2019 ◽  
Vol 3 (1) ◽  
Author(s):  
Riani Fifrianti ◽  
Perdana Wahyu Santosa
Keyword(s):  
Financial Distress ◽  
Financial Risk ◽  
Sampling Method ◽  
Stock Exchange ◽  
Sampling Technique ◽  
Financial Statements ◽  
Telecommunications Industry ◽  
Bankruptcy Prediction ◽  
Bankruptcy Problem ◽  
Financial Condition

<p>This study purposes to analyze of corporate bankruptcy prediction of telecommunication industry in Indonesia with Springate model. The data used in the form of financial statements published by the telecommunications industry at Indonesia Stock Exchange for 2009-2013<br />period. The sampling technique of this study was determined by purposive sampling method for six samples from Indonesia Stock Exchange (IDX). The results using Springate model shows that two companies, PT Bakrie Telecom, Tbk and PT Smartfren, Tbk could potentially<br />bankrupt in the future and three companies For PT Indosat, Tbk, PT XL Axiata, Tbk and PT Inovisi Infracom, Tbk are classified have financial distress problem. The company that very good results is PT Telekom Indonesia, Tbk and categorized has no bankruptcy problem. In<br />general analysis telecommunication caompany have no good financial condition because business risk and financial risk are higher relatively than other industry.</p>

scholarly journals PENGARUH CORPORATE GOVERNANCE TERHADAP KONDISI FINANCIAL DISTRESS PADA PERUSAHAAN CV. OTOPRO MOBILINDO

2018 ◽  
Author(s):  
Firma Yanti ◽  
Febryandhie Ananda
Keyword(s):  
Corporate Governance ◽  
Regression Analysis ◽  
Significant Influence ◽  
Financial Distress ◽  
Financial Stress ◽  
Financial Statements ◽  
T Test ◽  
Financial Condition ◽  
Simple Regression Analysis ◽  
Simple Regression

Financial distress is a stage of decreasing the company's financial condition, bad finance will result in bankruptcy of the company. This study aims to analyze the influence of corporate governance on financial distress. The indicator in this study is profitability, this study uses 36 samples from financial statements. CV. Otopro Mobilindo in 2015 - 2017 which was then analyzed using the SPSS For Windows 23. application This study used a classic assumption test consisting of normality, linearity and autocorrelation tests. The results of simple regression analysis show that the coefficient value of the corporate governance variable has a significant t test (t count). This shows that there is a negative and significant influence on corporate governance variables on financial distress in CV. Otopro Mobilindo. From the results of the determination test shows that the R Square coefficient increases and the variable financial distress conditions can be explained by corporate governance variables. While the rest is influenced by other variables not examined in this study related to financial stress.

scholarly journals FINANCIAL DISTRESS ANALYSIS USING THE ZMIJEWSKI METHOD

2020 ◽  
Vol 6 (1) ◽  
pp. 69-78
Author(s):  
Edon Ramdani
Keyword(s):  
Financial Reporting ◽  
Financial Distress ◽  
Stock Exchange ◽  
Good Condition ◽  
Financial Statements ◽  
Financial Reports ◽  
Financial Condition

This study aimed to determine the level of financial distress of the company using the Zmijewski method and conducted on three companies listed on the Indonesia Stock Exchange, namely PT Bakrieland Development Tbk, PT Central Omega Resources Tbk and PT Buana Lintas Lautan Tbk who received warnings from the IDX due to the delay in submitting financial reports. The results: the three companies are in good condition, with no financial distress. PT Bakrieland Development Tbk and PT Buana Lintas Lautan Tbk showed an increase in performance during the year 2016-2018 but PT Central Omega Resources Tbk decreased during the year 2016-2018. Companies are required to maintain the ability to meet their obligations and reduce the level of obligation so that it can be maintained does not lead to financial distress. Delays in the delivery of financial statements must be reduced so as not to harm investors. Analysis of financial distress needs to be continued to determine the company's financial condition. Contrast to previous studies that analyzed financial distress by comparing testing models and testing on companies listed on the IDX, this study focused on testing companies that received IDX warnings due to late financial reporting.

The Necessity and Ways of Legitimation of Large-scale Private Property in Russia: Raising a Problem

2007 ◽  
pp. 4-26
Author(s):  
G. Yavlinsky
Keyword(s):  
Large Scale ◽  
Private Property ◽  
Negative Consequences ◽  
Specific Nature ◽  
Considerable Part ◽  
Russian People ◽  
National Importance ◽  
Historical Tradition ◽  
Special Rules ◽  
Economic Assets

Results of privatization campaign in 1990’s continue to meet strong opposition from a very considerable part of Russian people and authorities actually refuse to consider the rights of private owners legitimate and not subject to violation. One of the reasons for this, besides historical tradition, is a specific nature of Russian privatization of 1990’s. The article brings to discussion a set of measures aimed at overcoming its negative consequences. While insisting on the need to honor all previous government obligations and commitments, the paper proposes a one-time special tax (windfall tax) to be levied on those who benefited most from privatization deals that were not just and fair, and special rules to be set for the use and sale of economic assets of national importance. The author also considers possible ways to legitimize private property, as well as chances to achieve а broad public consensus on this issue in Russia.

FRAUD TRIANGLE ANALYSES IN DETECTING FRAUDULENT FINANCIAL STATEMENT USING FRAUD SCORE MODEL

2020 ◽  
Vol 25 (1) ◽  
pp. 29-44
Author(s):  
Mariati ◽  
Emmy Indrayani
Keyword(s):  
Financial Stability ◽  
Linear Regression Analysis ◽  
Financial Statements ◽  
Multiple Linear Regression Analysis ◽  
External Pressure ◽  
Financial Statement ◽  
Fraud Triangle ◽  
Financial Statement Fraud ◽  
Financial Condition ◽  
Score Model

Company’s financial condition reflected in the financial statements. However, there are many loopholes in the financial statements which can become a chance for the management and certain parties to commit fraud on the financial statements. This study aims to detect financial statement fraud as measured using fraud score model that occurred in issuers entered into the LQ-45 index in 2014-2016 with the use of six independent variables are financial stability, external pressure, financial target, nature of industry, ineffective monitoring and rationalization. This study using 27 emiten of LQ-45 index during 2014-2016. However, there are some data outlier that shall be removed, thus sample results obtained 66 data from 25 companies. Multiple linear regression analysis were used in this study. The results showed that the financial stability variables (SATA), nature of industry (RECEIVBLE), ineffective monitoring (IND) and rationalization (ITRENDLB) proved to be influential or have the capability to detect financial statement fraud. While the external pressure variables (DER) and financial target (ROA) are not able to detect the existence of financial statement fraud. Simultaneously all variables in this study were able to detect significantly financial statement fraud.

Unexpected Consequences: The Effects on Non-Accelerated Filers of an Accelerated Filing Deadline and SOX Section 404

2020 ◽  
Vol 34 (3) ◽  
pp. 87-112
Author(s):  
Bei Dong ◽  
Stefanie L. Tate ◽  
Le Emily Xu
Keyword(s):  
Resource Allocation ◽  
Financial Statements ◽  
Financial Statement ◽  
Negative Consequences ◽  
Section 404 ◽  
Auditor Change ◽  
Time Required ◽  
Allocation Decisions ◽  
Jel Classifications ◽  
Resource Allocation Decisions

SYNOPSIS Regulations implemented by the SEC in 2003 and 2004 simultaneously shortened the financial statement filing deadlines and increased the time required for both the preparation of financial statements and the related audit of accelerated filers (AFs). However, there were indirect, unintended negative consequences for companies not subject to the regulations, namely, non-accelerated filers (NAFs). The new regulations imposed strains on auditor resources requiring auditors to make resource allocation decisions that negatively affected NAFs. We find that NAFs with an auditor who had a high proportion of AF clients (high-AF) had longer audit delays after the regulations were implemented than NAFs of an auditor with a low proportion of AF clients (low-AF). Further, we document that NAFs with high-AF auditors were more likely to change auditors than NAFs with low-AF auditors. Finally, NAFs that switched to auditors with less AFs experienced shorter audit delays after the auditor change. JEL Classifications: M42; M48.

“Community Interests” and the Role of International Law in the Creation of a Global Market for Agricultural Land

2018 ◽  
Author(s):  
Jochen von Bernstorff
Keyword(s):  
International Law ◽  
Large Scale ◽  
Agricultural Land ◽  
Food Sovereignty ◽  
Global Market ◽  
Negative Consequences ◽  
Cultural Rights ◽  
Land Grab ◽  
Large Scale Land ◽  
The One

The chapter explores the notion of “community interests” with regard to the global “land-grab” phenomenon. Over the last decade, a dramatic increase of foreign investment in agricultural land could be observed. Bilateral investment treaties protect around 75 per cent of these large-scale land acquisitions, many of which came with associated social problems, such as displaced local populations and negative consequences for food security in Third World countries receiving these large-scale foreign investments. Hence, two potentially conflicting areas of international law are relevant in this context: Economic, social, and cultural rights and the principles of permanent sovereignty over natural resources and “food sovereignty” challenging large-scale investments on the one hand, and specific norms of international economic law stabilizing them on the other. The contribution discusses the usefulness of the concept of “community interests” in cases where the two colliding sets of norms are both considered to protect such interests.

Financial distress determinants among SMEs: empirical evidence from Sweden

2020 ◽  
Vol 47 (3) ◽  
pp. 547-560 ◽  
Author(s):  
Darush Yazdanfar ◽  
Peter Öhman
Keyword(s):  
Financial Crisis ◽  
Financial Distress ◽  
Large Scale ◽  
Global Financial Crisis ◽  
Binary Logistic Regression ◽  
Data Availability ◽  
Cross Sectional ◽  
Data Set ◽  
Content Type ◽  
The Global Financial Crisis

PurposeThe purpose of this study is to empirically investigate determinants of financial distress among small and medium-sized enterprises (SMEs) during the global financial crisis and post-crisis periods.Design/methodology/approachSeveral statistical methods, including multiple binary logistic regression, were used to analyse a longitudinal cross-sectional panel data set of 3,865 Swedish SMEs operating in five industries over the 2008–2015 period.FindingsThe results suggest that financial distress is influenced by macroeconomic conditions (i.e. the global financial crisis) and, in particular, by various firm-specific characteristics (i.e. performance, financial leverage and financial distress in previous year). However, firm size and industry affiliation have no significant relationship with financial distress.Research limitationsDue to data availability, this study is limited to a sample of Swedish SMEs in five industries covering eight years. Further research could examine the generalizability of these findings by investigating other firms operating in other industries and other countries.Originality/valueThis study is the first to examine determinants of financial distress among SMEs operating in Sweden using data from a large-scale longitudinal cross-sectional database.

scholarly journals Predicting Firms’ Financial Distress: An Empirical Analysis Using the F-Score Model

2021 ◽  
Vol 14 (5) ◽  
pp. 199
Author(s):  
Mahfuzur Rahman ◽  
Cheong Li Sa ◽  
Md. Abdul KaiumMasud
Keyword(s):  
Prediction Model ◽  
Financial Distress ◽  
The United States ◽  
Research Database ◽  
Negative Consequences ◽  
Return On Assets ◽  
Listed Firms ◽  
Distressed Firms ◽  
Score Model ◽  
Relationship Of

Financial performance of firms is very important to bankers, shareholders, potential investors, and creditors. The inability of firms to meet their liabilities will affect all its stakeholders and will result in negative consequences in the wider economy. The objective of the study is to explore the applicability of a distress prediction model which uses the F-Score and its components to identify firms which are at high risk of going into default. The study incorporates a prediction model and vast literature to address the research questions. The sample of the study is collected from publicly listed firms of the United States. In total, 81 financially distressed firms wereextracted from the UCLA-LoPucki Bankruptcy Research Database during 2009–2017. This study found that the relationship of the F-Score and probability of firms going into financial distress is significant. This study also demonstrated that firms which are at risk of distress tend to record a negative cash flow from operations (CFO) and showed a greater decline in return on assets (ROA) in the year prior to default. This study extends the existing literature by supporting a model which has not been widely used in the area of financial distress predictions.

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