Extracting Key Phrases as Predictors of Corporate Bankruptcy: Empirical Analysis of Annual Reports by Text Mining

2011 ◽  
Vol 8 (1) ◽  
pp. 31-44 ◽  
Author(s):  
Cindy Yoshiko Shirata ◽  
Hironori Takeuchi ◽  
Shiho Ogino ◽  
Hideo Watanabe
Keyword(s):  
Annual Report ◽  
Prediction Models ◽  
Bankruptcy Prediction ◽  
Annual Reports ◽  
Financial Reports ◽  
Nonfinancial Information ◽  
Financial Position ◽  
Key Phrases ◽  
Retained Earnings ◽  
A Company

ABSTRACT Bankruptcy predictions have been one of the most interesting topics for accounting researchers. Most bankruptcy prediction models are developed by using financial ratios. However, signs of the changing financial position of a company may appear in the nonfinancial information earlier than we can identify the changes in the financial numbers. In recent years, analysis of qualitative information has become remarkably important, because frequent changes in accounting standards have made it difficult to compare financial numbers between years. In this study, we analyzed the sentences in financial reports in Japan and extracted key phrases/descriptions to predict bankruptcy. Our research revealed that if some particular expressions appear together with the word “dividend” or “retained earnings” in the same section of an annual report, they were effective in distinguishing between bankrupt companies and non-bankrupt companies.

scholarly journals Capital Structure and the Value of Quoted Firms in Nigeria: A Test of Miller and Modigliani Irrelevant Hypothesis

2019 ◽  
Vol 3 (2) ◽  
pp. 1-15
Author(s):  
Uzokwe Grace Onyinyechi
Keyword(s):  
Capital Structure ◽  
Random Effects ◽  
Market Value ◽  
Annual Reports ◽  
Cross Sectional ◽  
Financial Reports ◽  
Beta Coefficient ◽  
Equity Ratio ◽  
Retained Earnings

This study tested an insignificant hypothesis of the capital structure of Miller and Modiglian in Nigeria. The aim was to investigate the validity of the irrelevant hypothesis. The Tobins Q market value measure was modeled as a function of debt-to-equity ratio, long-term debt to equity ratio, and retained earnings ratio. Twenty companies were selected on the basis of the information needed to conduct the survey and the availability of annual financial reports for the ten-year period 2008-2017. Cross-sectional data were obtained from the annual accounts and annual reports of the companies. Random effects were used in the analysis of fixed and random effects. The study showed that 77% volatility in market value can be predicted by the variation of independent variables in the regression model. The beta coefficient of the variables found that the debt-to-equity ratio, the long-term debt-to-equity ratio, the capital-to-earnings ratio is positively and significantly related to the market value of the selected listed companies. The study concludes that capital structure is relevant, unlike Miller's and Modiglian's irrelevant hypothesis. Therefore, it is recommended that managers ensure an adequate combination of capital and debt.

New Developments in Management Reporting – The Modernisation of the Annual Report

2005 ◽  
Vol 6 (5) ◽  
pp. 861-868 ◽  
Author(s):  
Regine Buchheim ◽  
Kati Beiersdorf
Keyword(s):  
Annual Report ◽  
Annual Reports ◽  
Future Prospects ◽  
Commercial Law ◽  
New Developments ◽  
Financial Position ◽  
Court Of Justice ◽  
European Court ◽  
Management Reporting ◽  
Management Report

In Germany, the management report that comments on the company's business and financial position as well as its future prospects has long ago been introduced to the Handelsgesetzbuch (HGB – German Commercial Law). Ever since the European Court of Justice [ECJ] has clarified that GmbH & Co. KGs are classified as companies with limited liabilities under the 4th and 7th Directive, annual reports have to be published by an even wider range of companies.

scholarly journals Bankruptcy prediction in Visegrad group countries using multiple discriminant analysis

Equilibrium ◽  
2018 ◽  
Vol 13 (3) ◽  
pp. 569-593 ◽  
Author(s):  
Tomas Kliestik ◽  
Jaromir Vrbka ◽  
Zuzana Rowland
Keyword(s):  
Discriminant Analysis ◽  
Prediction Models ◽  
Value Added ◽  
Bankruptcy Prediction ◽  
Net Income ◽  
Multiple Discriminant Analysis ◽  
Financial Situation ◽  
The Future ◽  
A Company ◽  
Visegrad Group

Research background: The problem of bankruptcy prediction models has been a current issue for decades, especially in the era of strong competition in markets and a constantly growing number of crises. If a company wants to prosper and compete successfully in a market environment, it should carry out a regular financial analysis of its activities, evaluate successes and failures, and use the results to make strategic decisions about the future development of the business. Purpose of the article: The main aim of the paper is to develop a model to reveal the un-healthy development of the enterprises in V4 countries, which is done by the multiple discriminant analysis. Methods: To conduct the research, we use the Amadeus database providing necessary financial and statistical data of almost 450,000 enterprises, covering the year 2015 and 2016, operating in the countries of the Visegrad group. Realizing the multiple discriminant analysis, the most significant predictor and the best discriminants of the corporate prosperity are identified, as well as the prediction models for both individual V4 countries and complex Visegrad model. Findings & Value added: The results of the research reveal that the prediction models use the combination of same financial ratios to predict the future financial development of a company. However, the most significant predictors are current assets to current liabilities ratio, net income to total assets ratio, ratio of non-current liabilities and current liabilities to total assets, cash and cash equivalents to total assets ratio and return of equity. All developed models have more than 80 % classification ability, which indicates that models are formed in accordance with the economic and financial situation of the V4 countries. The research results are important for companies themselves, but also for their business partners, suppliers and creditors to eliminate financial and other corporate risks related to the un-healthy or unfavorable financial situation of the company.

scholarly journals Faktor – Faktor Yang Mempengaruhi Kebijakan Dividen Pada Perusahaan Manufaktur Yang Terdaftar Di Bursa Efek Indonesia Periode Tahun 2012-2016

2017 ◽  
Vol 8 (2) ◽  
Author(s):  
Gloria Julianita Sendow ◽  
Grace B Nangoi ◽  
Winston Pontoh
Keyword(s):  
Stock Price ◽  
Sampling Method ◽  
Dividend Policy ◽  
Annual Report ◽  
Annual Reports ◽  
Purposive Sampling ◽  
The Third ◽  
Closing Price ◽  
Logistic Regression Method ◽  
Retained Earnings

Abstract. This study aims to determine the effect of Stock Price (Closing Price), Profitability (ROA), Retained Earnings to Total Assets (RETA), Liquidity (CR) and Debt (DAR) on Dividend Policy in Indonesian manufacturing company during 2012 to2016. 28 companies were chosen as samples. They were selected by purposive sampling method. This study obtained those companies’ annual reports from their official websites. Hypotheses were tested by using logistic regression method. The results show that the first hypothesis of stock price does not affect  Dividend policy (0.156 > 0.05); the second hypothesis is profitability, it affects Dividend policy (0.003 < 0.005; the third hypothesis is RETA, it does not affect Dividend Policy (0.131 > 0.05), the fourth one is Liquidity, it does not affect Dividend policy (0.888 > 0.05); and the fifth hypothesis is Debt (DAR), it does not affect Dividend Policy (0.365 > 0.05).Keywords: Dividend Policy, Stock Price, Profitability, RETA, Liquidity, Debt. Abstrak. Penelitian ini bertujuan untuk mengetahui pengaruh Harga Saham (Closing Price), Profitabilitas (ROA), Retained Earnings to Total Assets (RETA), Likuiditas (CR) dan Hutang (DAR) terhadap Kebijakan Dividen pada perusahaan manufaktur yang terdaftar di BEI pada tahun 2012-2016.  Pemilihan sampel dengan menggunakan metode purposive sampling sehingga diperoleh jumlah sampel sebanyak 28 perusahaan. Penelitian ini menggunakan data sekunder yaitu laporan tahunan (annual report) yang diperoleh melalui website resmi perusahaan. Pengujian hipotesis dilakukan dengan menggunakan metode regresi logistik. Hasil penelitian menunjukkan bahwa hipotesis pertama yaitu harga saham tidak mempengaruhi kebijakan dividen (0.156 > 0.05), hipotesis kedua yaitu profitabilitas mempengaruhi kebijakan dividen (0.003 < 0.05), hipotesis ketiga yaitu RETA tidak mempengaruhi kebijakan dividen (0.131 > 0.05), hipotesis keempat yaitu likuiditas tidak mempengaruhi kebijakan dividen (0.888 > 0.05) dan hipotesis ke lima yaitu hutang tidak mempengaruhi kebijakan dividen (0.365 > 0.05).Kata Kunci: Kebijakan dividen, harga saham, profitabilitas, RETA, likuiditas, hutang

Diagnosing the Financial Distress in Oil Drilling and Exploration Sector of India through Discriminant Analysis

2019 ◽  
Vol 23 (4) ◽  
pp. 364-373
Author(s):  
Anita Nandi ◽  
Partha Pratim Sengupta ◽  
Abhijit Dutta
Keyword(s):  
Discriminant Analysis ◽  
Manufacturing Industry ◽  
Prediction Models ◽  
Bankruptcy Prediction ◽  
Total Asset ◽  
Financial Health ◽  
Z Score ◽  
Working Capital ◽  
Oil Drilling ◽  
Retained Earnings

The present study is mainly devoted to the bankruptcy prediction models and their ability to assess a bankruptcy probability for oil drilling and exploration sector of Indian. The study puts an effort to determine the financial health of 12 selected companies from this sector of India for a period of 5 years. These companies serve the backbone of many other industries such as transport industry, manufacturing industry, automobile industry and so on of the Indian economy. The study has taken the reference of Altman’s Z-score model, where ratios such as working capital to total asset, retained earnings to total asset, earnings before interest and tax to total assets, market value of equity to book value of debt and sales to total assets have been taken. The discriminant analysis is conducted to validate the outcomes of Altman’s model to predict group membership and to forecast the overall industry condition. The study reveals that 75 per cent of the companies are in financially healthy zone. The results indicate that working capital/total assets can very well explain the Z-score. The research on financial health using Altman’s score is very limited in Indian context. Therefore, this study will add value to the existing body of literature for financial risk.

Pengaruh Model Prediksi Kebangkrutan, Leverage, Audit Lag, Dan Ukuran Perusahaan Terhadap Opini Audit Going Concern

2013 ◽  
Vol 5 (1) ◽  
pp. 55-76
Author(s):  
Anastasia Paula Salean
Keyword(s):  
Prediction Model ◽  
Stock Exchange ◽  
Manufacturing Sector ◽  
Secondary Data ◽  
Bankruptcy Prediction ◽  
Annual Reports ◽  
Company Size ◽  
Financial Reports ◽  
Audit Opinion ◽  
Going Concern

The objective of this research is to examine the effect of bankruptcy prediction model, leverage, audit lag, and company size towards obtaining a going concern audit opinion.  The samples in this study are 11 companies listed in Indonesian Stock Exchange being classified as manufacturing sector in the year 2008-2011. The sample in this study determined based on purposive sampling. Data used in this study is a secondary data such as annual reports or financial reports.  The results from this study are (1) bankruptcy prediction model having no significant impact on obtaining a going concern audit opinion, (2) leverage having a significant impact on obtaining a going concern audit opinion, (3) audit lag leverage having a significant impact on obtaining a going concern audit opinion, (4) company size having no significant impact on obtaining a going concern audit opinion. Keywords: obtaining a going concern audit opinion, bankruptcy prediction model,leverage, audit lag, company size

scholarly journals Analisis Model Prediksi Kebangkrutan Altman Z-Score. Springate dan Zmijewski untuk Menilai Kelangsungan Usaha PT Enseval Putera Megatrading Tbk

2018 ◽  
Vol 12 (2) ◽  
pp. 128-132
Author(s):  
Choirunnisa Nurahayu ◽  
Evi Yuniarti ◽  
Nurmala Nurmala
Keyword(s):  
Economic Development ◽  
Cash Flow ◽  
Prediction Models ◽  
Bankruptcy Prediction ◽  
Business Continuity ◽  
Z Score ◽  
Financial Condition ◽  
Analysis Technique ◽  
Not At Risk ◽  
A Company

The economic development of PT EPM Tbk in 2011 to 2016 did not improved, because in 2011 to 2016 the cash flow statement of PT EPM Tbk. decreased. This writing aims to determine the prediction of bankruptcy at PT EPM Tbk with the Altman Z-Score, Springate and Zmijewski Score models to assess the business continuity of PT EPM Tbk from 2011 to 2016. The analysis technique used is the Altman Z-Score bankruptcy prediction model, Springate and the Zmijewski Score for various types of companies. Based on the results of the analysis of the three bankruptcy prediction models Altman Z-Score, Springate Score and Zmijewski Score shows that the business continuity assessment of PT Enseval Putera Megatrading Tbk in 2011 to 2016 is a company in good financial condition or a healthy company and is not at risk The Z-Score is more than the Altman Z-Score, Springate Score and Zmijewski Score standards.Keywords: Altman Z-Score, Springate Score, Zmijewski Score and Business Continuity

scholarly journals Analisis Model Altman Z-Score, Springate, dan Zmijewski Sebagai Metode dalam Memprediksi Kondisi Kebangkrutan pada PT. Garuda Indonesia, Tbk Periode 2014-2018

2019 ◽  
Vol 2 (1) ◽  
pp. 40
Author(s):  
Desyah Natalia Bilondatu ◽  
Meriyana Franssisca Dungga ◽  
Selvi Selvi
Keyword(s):  
Prediction Model ◽  
Research Method ◽  
Prediction Method ◽  
Secondary Data ◽  
Bankruptcy Prediction ◽  
Annual Reports ◽  
Z Score ◽  
Financial Reports ◽  
Descriptive Research ◽  
Independent Variable

This study aims to find out, describe and explain the results of the application of analysis from the prediction method of bankruptcy of the Altman Z-Score, Springate, and Zmijewski models used in assessing and predicting the potential for bankruptcy with the object of research at PT. Garuda Indonesia (Persero) Tbk 2014-2018. The method used in this research is descriptive research method using a quantitative approach, and the operationalization of the variables used is the independent variable, namely the bankruptcy prediction model with the dependent variable is financial ratios. The data used are secondary data in the form of annual financial reports (annual reports) PT. Garuda Indonesia (Persero) Tbk for the period 2014 to 2018. The results of this study indicate that the Altman Z-Score, Springate and Zmijewski methods are able to measure and predict bankruptcy of companies with different portions according to the calculations applied in each of these analyzes.Keywords: Altman Z-Score, Springate, Zmijewski, and Bankruptcy

scholarly journals Comparative Analysis of Financial Sustainability Using the Altman Z-Score, Springate, Zmijewski and Grover Models for Companies Listed at Indonesia Stock Exchange Sub-Sector Telecommunication Period 2014 – 2019

2021 ◽  
Vol 4 (1) ◽  
Author(s):  
Samrony Eka Fauzi ◽  
◽  
Sudjono Sudjono ◽  
Ahmad Badawi Saluy
Keyword(s):  
Sampling Method ◽  
Prediction Models ◽  
Stock Exchange ◽  
Bankruptcy Prediction ◽  
Annual Reports ◽  
Financial Sustainability ◽  
Comparative Testing ◽  
Purposive Sampling ◽  
Financial Condition ◽  
Analysis Models

This study aims to compare the best bankruptcy prediction models between Altman, Springate, Zmijewski and Grover models against companies listed on the Indonesian stock exchange in the telecommunications sub-sector for the 2014-2019 period. The purposive sampling method is used to obtain a sample of companies with the following criteria: Companies listed on the Indonesian stock exchange, the telecommunications sub-sector, the company has conducted an IPO in 2010, the company is obedient in reporting annual reports from 2014 - 2019 and the company is free from delisting issues. There are 4 companies that meet the purposive sampling criteria, namely PT. Telkom TBK, PT. Indosat TBK. PT. XL Axiata TBK and PT. Smartfren TBK. The data used in this research is secondary panel data. The results showed that only PT. Telkom which is in a healthy financial condition. Meanwhile, PT. Indosat, PT. XL Axiata and PT. Smartfren is consistently in an unhealthy condition based on the analysis of the Altman and Springate models. The calculation of Zmijewski's model and Grover's model gave inconsistent results. Comparative testing of the four bankruptcy analysis models resulted in the Altman, Springate and Grover models recording accurate results but Altman modelling is the best because it is an accurate, consistent, and tested model both descriptively and statistically.

scholarly journals EXPLORATION ON THE DEFINITION AND THE REAL MEANING OF CORPORATE REAL ESTATE TERM

2019 ◽  
Vol 17 (9) ◽  
Author(s):  
Farahiyah Fadzil
Keyword(s):  
Real Estate ◽  
Paradigm Shift ◽  
Annual Report ◽  
Annual Reports ◽  
Accounting Standard ◽  
Corporate Real Estate ◽  
Asset Value ◽  
Definition Of ◽  
Real Estate Assets ◽  
A Company

Corporate Real Estate (CRE) is not a new term in the field of property research. In fact, disciplines of CRE research are becoming increasingly widespread nowadays. Consequently, the interpretation of CRE term has undergone a paradigm shift as time goes by. This study explored the definitions of CRE in the eyes of academicians and researchers as well as the meanings of CRE based on Malaysian Accounting Standard Board (MASB). Literatures were chosen to illustrate the breadth of knowledge available regarding the CRE definition. The broad definition of Corporate Real Estate (CRE) term (since 1983 to 2016) has been presented in the form of table. The discussion on the definition of CRE involves four phases, where each phase consists of 10 years. This allowed the researcher to see whether there were any changes or improvements to the definition of CRE in the last 40 years. Then, the CRE meaning was further examined, but from a different perspective. Therefore, content analysis of annual reports prepared by 40 Malaysian non-property public listed companies was conducted in order to identify the CRE term that has been applied in their companies. It was found that the CRE term was not adopted to represent real estate of a particular company. This study managed to identify 29 different terms that represent corporate real estate assets, of which nine (9) are used to represent “building” while six (6) are used to represent “land”. However, to understand the CRE of a company, the terms used in the company annual report are insufficient. What is more important is to recognise the information related to the CRE asset value. The information is not only intended to illustrate the wealth of company CRE assets, but also to pinpoint anything that happens to CRE such as depreciation, disposal, etc.

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