Predicting financial distress using financial and non-financial variables
Journal of Economic and Financial Sciences
| Field | Value | |
| Title | Predicting financial distress using financial and non-financial variables | |
| Creator | Van Der Colff, Francois Vermaak, Frans | |
| Description | This study attempts to clarify whether using a hybrid model based on non-financial variables and financial variables is able to provide a more accurate company financial distress prediction model than using a model based on financial variables only. The relationship between the model test results and the De la Rey K-Score for the subject companies is tested, employing Cramer’s V statistical test. A movement towards a Cramer’s V value of one indicates a strengthening relationship, and a movement towards zero is an indication of a weakening relationship. Against this background, further empirical research is proposed to prove that a model combining financial variables with true non-financial variables provides a more accurate company distress prediction than a financial variable-only model. The limited evidence of a strengthening relationship found is insufficient to establish the superiority of the proposed model beyond reasonable doubt. | |
| Publisher | AOSIS | |
| Date | 2015-04-30 | |
| Identifier | 10.4102/jef.v8i1.93 | |
| Source | Journal of Economic and Financial Sciences; Vol 8, No 1 (2015); 243-260 2312-2803 1995-7076 | |
| Language | eng | |
| Relation |
The following web links (URLs) may trigger a file download or direct you to an alternative webpage to gain access to a publication file format of the published article:
https://jefjournal.org.za/index.php/jef/article/view/93/89
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