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Prediction of financial distress companies in the trading and services sector in Malaysia using macroeconomic variables

Alifiah, Mohd. Norfian (2013) Prediction of financial distress companies in the trading and services sector in Malaysia using macroeconomic variables. In: International Conference on Innovation, Management and Technology Research 2013, 2013.

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Abstract

This study attempts to predict financial distress companies in the trading and services sector in Malaysia using financial distress companies as the dependent variable and macroeconomic variables and financial ratios as the independent variables. Logit Analysis was used as the analysis procedure because financial ratios do not have to be normal if it is used. It is also suitable when the dependent variable is binary in nature. Furthermore, it can also provide the probability of a company being financially distress. In addition, it can also provide us with the sign of the independent variable(s). This study found that the independent variables that can be used to predict financial distress companies in the trading and services sector in Malaysia were debt ratio, total assets turnover ratio, working capital ratio, net income to total assets ratio and base lending rate.

Item Type:Conference or Workshop Item (Paper)
Uncontrolled Keywords:financial distress, macroeconomic variables
Subjects:H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Divisions:Management
ID Code:38744
Deposited By: Liza Porijo
Deposited On:25 May 2014 12:51
Last Modified:05 Feb 2017 14:14

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