Z-score Model Research Articles

PENERAPAN MODEL ALTMAN Z-SCORE UNTUK ANALISIS KEBANGKRUTAN PERUSAHAAN MENGGUNAKAN (SUB SEKTOR PERUSAHAAN MAKANAN DAN MINUMAN TERDAFTAR DI BURSA EFEK INDONESIA)

The company was founded with the aim of maximizing profits and maximizing the welfare of stakeholders. The food nd beverage industry plays an important and influential role in Indonesia’s economic growth. Along with the development of the times and the world economy, competition in the business world has become very tight. Not a few companies experience financial difficulties because management is difficult to analyze the company’s financial condition. The Altman Z-Score method can be used as an early warning system to identity early symptoms of bankruptcy so tha company management can be improved. This is what underlies the making of this bankruptcy analysis system so that management can find out the company’s financial condition is in a healthy condition, gray area, or bankrupt. The system development uses the extrame programming method, and uses UML as a tool to analyze the system to be created. The web-based implementation uses the Codeigniter framework, Sublime as a text editor, and MySQL as a database management system. The test results from from this design process can be concluded that the web-bases system of Corporate Bankruptcy Anaysis Using the Atman Z-Score Model in Food and Beverage Companies Listed on the Indonesia Stock Exchange can be used to analyze the financial condition of companies in the healthy, greyarea, or bankrupt categories.

BANKRUPTCY PREDICTION ANALYSIS OF MANUFACTURING COMPANIES CONSUMER GOODS INDUSTRY SECTOR USING ALTMAN Z-SCORE METHOD DURING THE COVID-19 PANDEMIC

The main problem in this thesis is that during the Covid-19 pandemic in 2020 the company experienced a decline in sales and company profits also decreased and some even experienced losses, and the company's total debt increased, this led to the factors that led to the company's bankruptcy. The purpose of this study was to determine the prediction of company bankruptcy before the pandemic and during the pandemic using the first Altman Z-Score model. The type of research used is descriptive research. The research method used is quantitative. Data collection techniques through documentation in the form of financial reports of eleven companies engaged in the Consumer Goods Industry Sector listed on the IDX for the 2017-2020 period through the official website www.idx.co.id. The data analysis technique used the first model Altman Z-Score method. The results of research that have been conducted on eleven companies engaged in the Consumer Goods Industrial Sector listed on the IDX in the 2017-2020 period, namely the period before the pandemic and during the Covid-19 pandemic using the Almant Z-Score method, obtained the following results: First, companies that are not affected by the pandemic are PT. HM Sampoerna Tbk and PT. Bantoel International Investama Tbk, and PT Sariguna Primatirta Tbk. Second, the companies affected by the pandemic are PT. Kino Indonesia Tbk, PT. Akasha Wira International Tbk, PT. Campina Ice Cream Industri Tbk, PT. Prima Cakrawala Abadi Tbk. Third, for other companies, namely PT. Merck Tbk, PT. Martina Berto Tbk, PT. FKS Food Sejahtera Tbk, and PT. Kedaung Indah Can Tbk was in a dangerous zone in the period before the pandemic and during the pandemic

Does the efficiency of working capital management affect a firm’s financial distress? Evidence from UAE

PurposeThis study aims to explore the relative efficiency of the working capital management (WCM) for Emirati firms before and during the coronavirus crisis. Next, this study explores the potential impact of WCM on the likelihood of financial distress.Design/methodology/approachA data envelopment analysis (DEA) was applied to assess the relative efficiency of the WCM. This study uses the emerging market Z-score model to predict the likelihood of financial distress. The logistic regression was applied to investigate the impact of the efficiency of WCM on firms’ financial distress.FindingsThe results of this study model showed a negative and significant influence of the efficiency of WCM on firms’ financial distress likelihood.Practical implicationsThe findings have important implications for many stakeholders, including decision makers, WC managers, financiers, investors, financial consultants, researchers and others, in increasing their awareness of firms’ WCM performance before and during the crisis. Further, the results could have implications for trading strategies as investors seek attractive economic gains from their investment in firms that care about WCM.Social implicationsThe implications of WCM performance on social interests would cause firms’ decision makers to operate efficiently and achieve the best practices to minimise the probability of firms' financial distress.Originality/valueThis study advances a novel contribution to the literature by introducing a novel model to assess WCM based on DEA technology.

A Study on the Trends of the Global Cruise Tourism Industry, Sustainable Development, and the Impacts of the COVID-19 Pandemic

Stable financial operation is the essential factor for the sustainable development of the cruise tourism industry. The cruise industry was one of the fastest growing before the COVID-19 pandemic. The industry is capital intensive, has an enormous supply chain, serves to improve many ports-of-call economies, hires an immense quantity of people worldwide, and has a substantial economic contribution worldwide, especially in coastal countries or areas. COVID-19 has disrupted what had been an unending development of growth and success for the cruise industry. This study aims to analyze the financial performance of the worldwide cruise industry and realize the trends in the cruise tourism industry. The study examines the statistical data of the top three cruise companies that account for nearly 74.6–91.8% of the worldwide cruise tourism for 2015–2021. The financial analysis includes economic structure, solvency, operating ability, profitability, and financial leverage. We also analyze the economic indicators of the top three cruise companies with frequency analysis, correlation analysis, regression analysis, and the financial management risks of the top three cruise companies with the Z-Score Model. In addition, the study organizes and summarizes the impact of the COVID-19 pandemic on global cruise tourism. The study found that from mid-March 2020 until July 2021, the temporary suspension decreased passenger numbers, operating losses, and stock price losses. The research results confirm that the COVID-19 pandemic has caused the suspension of cruise ships worldwide. The break has led to a sharp drop in the number of cruise passengers, resulting in a significant decrease in operating income and profits of cruise companies, and the debt-to-assets ratio and leverage ratio have increased significantly. The excessive debt ratio will affect the sustainable operation of cruise companies and the sustainable development of the cruise industry. Because of the enormous impact and damage caused to the cruise industry by the COVID-19 pandemic, it is suggested that the cruise industry should take effective preventive strategies against highly contagious infectious diseases, deploy these strategies ahead of time, and strengthen the resilience and pandemic prevention ability of the cruise industry, to achieve the goal of sustainably developing the cruise industry.

PENGARUH CORPORATE GOVERNANCE, CASH FLOW, DAN PROFIT TERHADAP FINANCIAL DISTRESS PERUSAHAAN MANUFAKTUR DI BURSA EFEK INDONESIA

This study aims to provide empirical evidence on the effect of corporate governance, cash flow and profit on financial distress conditions in manufacturing companies in Indonesia listed on the Indonesia Stock Exchange (IDX). This research is expected to be useful as a reference for similar studies and to provide information related to financial distress conditions. The dependent variable in this study is financial distress which is measured using the Altman Z-Score model. The independent variables in this study are institutional ownership, managerial ownership, the proportion of independent commissioners, the number of boards of directors, the audit committee size, cash flow and profit. The population of this study are all manufacturing companies listed on the Indonesia Stock Exchange (IDX). The sampling technique in this study used purposive sampling and data analysis techniques, namely logistic regression analysis. The results of this study indicate that institutional ownership, cash flow and profit have a significant negative effect on financial distress, then the number of boards directors and the size of the audit committee size have a significant positive effect on financial distress. Meanwhile, managerial ownership and the proportion of independent commissioners has no significant effect on financial distress conditions.

PROYEKSI KEBANGKRUTAN PADA PERUSAHAAN INDEKS LQ45 DI BURSA EFEK INDONESIA

This study aims to determine financial distress with the Altman Z-score, Zmijewski, and Grover models to predict bankruptcy in LQ45 Index Companies on the Indonesia Stock Exchange. The population of this research is all issuers or publicly listed companies whose shares are consistently included in the LQ45 Index on the Indonesia Stock Exchange for the 2017-2020 period. Sampling using the purposive sampling method. Data collection is done by using documentation techniques. The results of calculations based on the Altman Z-Score model on LQ45 Index companies during the 2017-2021 period obtained eight companies in the gray area and two companies in the distress area, namely PT. XL Axiata Tbk and PT. Jasa Marga (Persero). Meanwhile, using the Zmijewski model, four companies were categorized as experiencing financial distress during the 2017-2020 period, namely PT. Bank Central Asia Tbk, PT. Bank Negara Indonesia (Persero) Tbk, PT. State Savings Bank (Persero) Tbk, PT. Bank Mandiri (Persero) Tbk. Based on the results of the calculation of financial distress with the Grover model, two companies are categorized as experiencing financial distress, namely PT. XL Axiata Tbk and PT. Jasa Marga (Persero).

Potensi Kebangkrutan Pada Pra-Pandemi dan Masa Pandemi serta Pengaruhnya Terhadap Profitabilitas

This study aims to identify the potential for bankruptcy in the tourism and recreation industry listed on the IDX in the pre-pandemic and pandemic periods and its effect on profitability. The potential for bankruptcy in this research was measured by the modified Altman Z-Score model, while profitability was measured by return on assets. The research method used is quantitative research with a descriptive-associative approach. The source of data in this study uses secondary data in the form of the company's annual financial statements. The data analysis technique used a modified Altman Z-Score model, panel data regression analysis, classical assumption test, and hypothesis testing. The calculation results show that in the pre-pandemic, on average, the tourism and recreation industry companies were in the safe category with healthy financial conditions, while during the pandemic, the average company was in the gray category with a condition prone to bankruptcy. Based on the result of tests, the potential for bankruptcy has a significant effect on profitability. The greater potential for bankruptcy will affect the smaller profitability value and otherwise, the smaller bankruptcy potential will affect the greater profitability value &nbsp

ANALYSIS OF THE FINANCIAL MANAGEMENT OF MUNICIPAL ENTERPRISES IN BLAGOEVGRAD WITH Z-SCORE MODEL

It is generally accepted that municipal property is a basic prerequisite for financial autonomy and administrative independence of local authorities. In Bulgaria, municipalities received ownership rights from the Constitution (1991) and this regulation was further confirmed by the Law on Local Self-Government and Local Administration (1991). In 1996 municipal property was finally settled with the adoption of the Law on Municipal Property and the Law on State Property. In the late 1990s local governments received significant amounts of assets from the central government. The process was accompanied by abuses of administrative authority, corruption scandals, and financial mismanagement. Two decades latter, Bulgarian municipalities have different types of assets, but the effectiveness of local financial management is still a topical issue. This paper aims to analyse and estimate the financial performance of nine enterprises owned by Blagoevgrad municipality with Z-Score model. The analyzed period covers the years from 2006 to 2020. The results indicate that municipal enterprises can achieve profitability while providing a wide range of services to the local community.

Financial Risk, Firm Size and Financial Distress: Turbulent Times for Firms Listed at the Nairobi Securities Exchange, Kenya

In Kenya, at least 6 listed firms became insolvent and got into liquidation over a period of 10 years (2009-2018) leading to loss of income, unemployment and other negative outcomes. Hence, the financial stability of the existing listed firms should be examined closely since the firms are expected to be stable at any point in time. Firm Size has been observed to moderate the relationship between various variables and financial distress of firms though there is little empirical evidence in developing economies particularly for firms that are listed at the Nairobi Securities Exchange in Kenya. Hence an empirical issue that remains is to determine what moderating effect firm size has on the relationship between financial risk and financial distress of the listed firms. The general objective was to investigate the moderating effect of firm size on the relationship between financial risk and financial distress of firms listed at Nairobi Securities Exchange, Kenya for the period 2009-2018. This study was based on Wreckers theory of financial distress, Trade off theory, Distress theory, Early Bankruptcy theory and the Altman’s Z-Score Model for financial distress. The study adopted positivism research philosophy and explanatory and descriptive research designs. The targeted population entailed all 66 firms listed at the Nairobi Securities Exchange, Kenya as at 2018. Time Series Cross-Sectional secondary data was analyzed. The following diagnostic tests were carried out before delving into data analysis: Tests for Multicollinearity, Outliers, Heteroscedasticity, Autocorrelation, Linearity, Goodness of Fit, Stationarity and Model Specification. Data analysis was done using descriptive statistics and inferential statistics using Binary Logistic regression model. The findings indicate that Firm size indeed moderates the relationship between financial risk and financial distress of firms listed at the NSE, Kenya at 5% significance levels. Optimal firm sizes should be set up for listed firms to manage financial distress.

Financial distress prediction using integrated Z-score and multilayer perceptron neural networks

The COVID-19 pandemic led to a great deal of financial uncertainty in the stock market. An initial drop in March 2020 was followed by unexpected rapid growth over 2021. Therefore, financial risk forecasting continues to be a central issue in financial planning, dealing with new types of uncertainty. This paper presents a stock market forecasting model combining a multi-layer perceptron artificial neural network (MLP-ANN) with the traditional Altman Z-Score model. The contribution of the paper is presentation of a new hybrid enterprise crisis warning model combining Z-score and MLP-ANN models. The new hybrid default prediction model is demonstrated using Chinese data. The results of empirical analysis show that the average correct classification rate of thew hybrid neural network model (99.40%) is higher than that of the Altman Z-score model (86.54%) and of the pure neural network method (98.26%). Our model can provide early warning signals of a company's deteriorating financial situation to managers and other related personnel, investors and creditors, government regulators, financial institutions and analysts and others so that they can take timely measures to avoid losses.

ANALISIS TINGKAT KEBANGKRUTAN SEBELUM DAN SAAT PANDEMI DENGAN MENGGUNAKAN METODE ALTMAN Z-SCORE DAN SPRINGATE S-SCORE (STUDI KASUS PADA PERUSAHAAN RETAIL YANG TERDAFTAR DI BURSA EFEK INDONESIA 2016-2020)

This study aims to determine the difference in results in predicting bankruptcy using the Altman Z-Score model and the Springate S-Score model, as well as ineasures which model is most accurate in predicting bankruptcy at retail companies at Indonesia. The population used in this study are retail companies listed on the Indonesia Stock Exchange (IDX) for the 2016-2020 period with a sample of 11 companies. The sampling method used in this study was purposive sampling. The data analysis technique used multiple discriminant analysis. The results showed that there were differences in the results in predicting bankruptcy before and during the pandemic. Based on the two measurement methods used, before the pandemic there were 4 companies that were declared bankrupt and 7 companies that were declared healthy. During the pandemic, 8 companies were declared bankrupt and 3 companies were declared healthy. The bankruptcy model that has the highest level of accuracy is the Springate S-Score.

Perbandingan Kebangkrutan Menggunakan Model Altman Z Score, Model Springate dan Model Zmijweski

This study aims to examine more deeply the comparison of the bankruptcy of the Altman Z-Score, Springate, and Zmijewski models in companies listed on the Indonesia Stock Exchange in the pharmaceutical and food and beverages sector for the period 2015-2020. This research is a quantitative research using secondary data with a research population of 42 companies and a research sample of 12 companies with a sampling technique using purposive sampling. The data collection method is done by accessing the annual financial reports published by the Indonesia Stock Exchange. The data obtained were then processed using the IBM SPSS Statistic 25 tool. This analysis included descriptive statistical tests, classical assumption tests (normality tests), and hypothesis tests (paired samples test, accuracy test). The results showed that the Altman Z-Score model was significantly different from the Springate model, the Altman Z-Score model was significantly different from the Zmijewski model, the Springate model was significantly different from the Zmijewski model. The accuracy test shows that the Zmijewski model has the highest level of accuracy in predicting bankruptcy.

Perbandingan Kebangkrutan Menggunakan Model Altman Z Score, Model Springate dan Model Zmijweski

This study aims to examine more deeply the comparison of the bankruptcy of the Altman Z-Score, Springate, and Zmijewski models in companies listed on the Indonesia Stock Exchange in the pharmaceutical and food and beverages sector for the period 2015-2020. This research is a quantitative research using secondary data with a research population of 42 companies and a research sample of 12 companies with a sampling technique using purposive sampling. The data collection method is done by accessing the annual financial reports published by the Indonesia Stock Exchange. The data obtained were then processed using the IBM SPSS Statistic 25 tool. This analysis included descriptive statistical tests, classical assumption tests (normality tests), and hypothesis tests (paired samples test, accuracy test). The results showed that the Altman Z-Score model was significantly different from the Springate model, the Altman Z-Score model was significantly different from the Zmijewski model, the Springate model was significantly different from the Zmijewski model. The accuracy test shows that the Zmijewski model has the highest level of accuracy in predicting bankruptcy.

Pengaruh Likuiditas, Leverage dan Aktivitas terhadap Kondisi Financial Distress yang Dimoderasi oleh Profitabilitas: Studi pada Perusahaan Pertambangan yang Terdaftar di BEI Periode 2015-2019

Abstract: Purpose: The aimed of this study was to found liquidity, leverage, and activity effect to financial distress moderated by profitability in mining companies listed on the IDX in the period 2015-2019, measured by the altman z-score model. Research methodology: Descriptive and associative methods are used as research methods. Sample of this study was 10 mining companies registered in the IDX in the period 2015-2019 obtained by purposive sampling method. The tool used is EViews 10 with panel data regression analysis techniques. Results: The results indicates that only liquidity and leverage had an effect on financial distress. Simultaneusly liquidity, leverage and activity also affect financial distress. Then, profitability is found to moderate the effect of liquidity on financial distress. Limitations: The limitations of the study are on the sample size and the period of research that allows to be added to future research, as well as the possible use of other financial distress measurement methods. Contribution: Produce findings on variables that can affect financial distress in mining companies by using profitability as a moderation variable. Keywords: 1. Altman z-score 2. activity 3. financial distress 4. liquidity 5. leverage 6. profitability

Analisis Tingkat Kesulitan Keuangan Perusahaan Makanan dan Minuman Akibat Pandemi Covid-19

Since the development of the Corona virus, which was first discovered towards the end of 2019 in Wuhan, Hubei Region, China, it has spread throughout the world because of its fast-spreading contagion. All the affected countries have adopted different strategies to reduce the rate of transmission of this infection, in particular small to large scope social restrictions. The implementation of these approaches in the long term will have a very real impact around the world, one of which is the decline in global financial movements, considering Indonesia. In this study, financial ratios were calculated for all data using financial ratios in the Modified Altman Z-Score model, Grover Score, Zmijewski. The results of the Altman Z-Score Altered model analysis on food and beverage companies during the Coronavirus pandemic, precisely in the 2020 quarter, food and beverage companies are expected to experience financial distress as many as 4 companies. The results of the calculation based on the analysis of the Grover Score model for food and beverage companies during the Coronavirus pandemic, to be precise, per quarter of 2020, the F&B companies that are expected to experience financial distress are 3 companies. The results of calculations based on the Zmijewski model for food and beverage companies during the Coronavirus pandemic, to be precise, per quarter of 2020, food and beverage companies that are expected to experience financial distress are 2 companies.

Does gender diversity on boards reduce the likelihood of financial distress? Evidence from Malaysia

PurposeThe purpose of this paper is to examine the impact of board gender diversity on firm financial distress for a sample of 367 non-financial firms listed on Bursa Malaysia over the period from 2011 to 2019.Design/methodology/approachThe study employs both panel logistic regression and dynamic generalized method of moments estimator to determine the impact of board gender diversity on the likelihood of financial distress. Altman Z-score model is used as a proxy for financial distress indicator. The bigger the Z-score, the smaller the risk of financial distress.FindingsThe results show that board gender diversity could help to improve board effectiveness by preventing corporations from being too exposed to financial distress and bankruptcy. In particular, whether they are independent or inside members, women directors are likely to reduce the likelihood of financial distress. The results also show that the effect of female directors on the likelihood of financial distress is strengthened through more board independence. The results are consistent with those in prior research that documents the benefits of board gender diversity.Practical implicationsThis paper provides insights for corporate decision makers in emerging economies, helping them to determine the board's design in terms of roles and composition that promote governance practices and prevent financial troubles. Furthermore, the findings of this study may be useful regulators as they shed light on the importance to undertake measures and reforms to promote board effectiveness by the introduction of gender diversity. Finally, this study also offers implications for society in general, considering that the practice of enhancing board gender diversity can significantly safeguard the interest of a wide range of stakeholders by reducing the chances of corporate bankruptcy.Originality/valueWhile prior research has examined the effect of board gender diversity on firm performance, this study is the first to investigate the effect of board gender diversity on the likelihood of financial distress in Malaysia.

Pengaruh Likuiditas, Leverage dan Aktivitas terhadap Kondisi Financial Distress yang Dimoderasi oleh Profitabilitas: Studi pada Perusahaan Pertambangan yang Terdaftar di BEI Periode 2015-2019

Abstract Purpose: The aimed of this study was to found liquidity, leverage, and activity effect to financial distress moderated by profitability in mining companies listed on the IDX in the period 2015-2019, measured by the altman z-score model. Research methodology: Descriptive and associative methods are used as research methods. Sample of this study was 10 mining companies registered in the IDX in the period 2015-2019 obtained by purposive sampling method. The tool used is EViews 10 with panel data regression analysis techniques. Results: The results indicates that only liquidity and leverage had an effect on financial distress. Simultaneusly liquidity, leverage and activity also affect financial distress. Then, profitability is found to moderate the effect of liquidity on financial distress. Limitations: The limitations of the study are on the sample size and the period of research that allows to be added to future research, as well as the possible use of other financial distress measurement methods. Contribution: Produce findings on variables that can affect financial distress in mining companies by using profitability as a moderation variable.

THE EFFECT OF FINANCIAL RATIO IN THE ALTMAN Z-SCORE ON FINANCIAL DISTRESS

The purpose of this study is to determine the effect of financial ratio in Altman Z-Score Model, that is Net Working Capital to Total Assets, Retained Earnings to Total Assets, Earnings Before Interest Tax to Total Assets, and Book Value of Equity to Total Liability on the probability of financial distress in manufacturing companies. This research uses purposive sampling method where 39 samples companies are obtained. The criteria for financial distress in this study were measured using the Altman Z-Score. The result show that Net Working Capital to Total Assets and Book Value of Equity to Total Liability has an effect on the probability of financial distress, but Retained Earnings Total Asset and Earnings Before Interest Tax to Total Assets has no effect on the probability of financial distress

Leverage strategies of Indian telecom sector: a dynamic panel data approach

PurposeThe purpose of this paper is to examine the optimal leverage ratio, speed of adjustment, and which factors contribute to achieving the target of selected telecom companies in a partial adjustment framework from 2008 to 2017. Further is to analyze the likelihood of bankruptcy of sample companies by Altman Z-Score model and to suggest which theory of capitals structure is better in explaining leverage strategies and judicious mix of debt and equity structure of the selected telecom companies.Design/methodology/approachThis paper chooses a partial adjustment model and uses the generalized method of moments technique to identify the variables that influence the target leverage ratio and the factors that influence the speed at which the target leverage is adjusted. Second, the Altman Z-score model is used in this paper to research the financial status of telecom companies using financial instruments and techniques.FindingsFor Indian telecom firms, firm-specific variables such as profitability, NDTS and Z-score lead to greater debt adjustment towards optimal level target leverage. The paper also highlights new paradigms in the Indian telecom sector, stating that top market leaders such as Bharti Airtel, BSNL, Idea, Vodafone and R.com, among others, should focus on debt reduction and interest payments, as well as implement new strategies to solve the crisis and change financial policies.Research limitations/implicationsIt mainly focuses on firm-specific variables because the firm-specific variables affect the leverage framework. The country-specific variables are not taken into the study. These results may be unique to telecom companies due to some peculiarities existing in the telecom sector in India. Although other sectors, both national and international level, can be taken into consideration.Practical implicationsThis paper has ramifications for corporate executives, investors and policymakers in India, for example, in terms of considering different transition costs while changing a telecom company’s financing decisions.Originality/valueTo the best of the authors’ knowledge, this is the first paper of its kind to look at both financial and econometric tools to assess financial performance using the Altman Z-Score model, as well as decide leverage strategies and the pace with which they can be adjusted to target leverage in the context of Indian telecom companies.

Analisis Perbandingan Model Z Altman Dan Model The Grover Dalam Mengukur Kesehatan Perusahaan Food And Beverages Di Bursa Efek Indonesia

This study aims to determine and analyze the comparison of the Altman Z-Score model and the Grover model in predicting the health level of food and beverages companies on the Indonesia Stock Exchange for the 2018-2020 period. The type of research used is quantitative analysis. The data used in this study are financial reports published through the IDX. The sampling technique used purposive sampling technique in order to obtain 14 companies that were used as research samples. The data analysis technique used the independent sample t-test and the level of accuracy test. The conclusion of this study shows that there is a significant difference between the Altman Z-Score model and also the Grover model in measuring company health. The most accurate prediction model was achieved by the Grover model with an accuracy percentage of 100% and the Altman Z-Score model with an accuracy rate of 90.48%.