IDEAS home Printed from https://ideas.repec.org/a/usm/journl/aamjaf00202_75-93.html
   My bibliography  Save this article

A Financial Distress Pre-Warning Study by Fuzzy Regression Model of TSE-Listed Companies

Author

Listed:
  • Wen-Ying Cheng

    (Department of Business Administration, National Ping-tung University of Science and Technology, Shuehfu Rd., Neipu, Pingtung 91201, Taiwan, R.O.C.)

  • Ender Su

    (Department of Insurance and Risk Management, National Kaohsiung University of Science and Technology, Juoyue Rd., Nantz District, Kaohsiung 811, Taiwan, R.O.C.)

  • Sheng-Jung Li

    (Department of Insurance and Risk Management, National Kaohsiung University of Science and Technology, Juoyue Rd., Nantz District, Kaohsiung 811, Taiwan, R.O.C.)

Abstract

The purpose of this paper is to construct a financial distress pre-warning model for investors and risk supervisors. Through the Securities and Futures Institute Network, we collect the financial data of the electronic companies listing on the Taiwan Security Exchange (TSE) from 1998 to 2005. By binary logistic regression test, we found that financial statement ratios show significant difference in different financial stages. On the other hand, using fuzzy regression model, we construct a rating model of financial administration stages for investors and risk supervisors and found that prediction validity for financial distress companies and total companies by fuzzy regression model are better than binary logistic regression model using our research sample (89.77 and 90.98% vs. 85.27 and 90.30%).

Suggested Citation

  • Wen-Ying Cheng & Ender Su & Sheng-Jung Li, 2006. "A Financial Distress Pre-Warning Study by Fuzzy Regression Model of TSE-Listed Companies," Asian Academy of Management Journal of Accounting and Finance (AAMJAF), Penerbit Universiti Sains Malaysia, vol. 2(2), pages 75-93.
    • Handle: RePEc:usm:journl:aamjaf00202_75-93
    as

    Download full text from publisher

    File URL: http://web.usm.my/journal/aamjaf/vol2-2/2-2-5.pdf
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Soliwoda, Michał, 2014. "Bezpieczeństwo Finansowe Gospodarstw Rolniczych W Polsce Z Perspektywy Wspólnej Polityki Rolnej," Village and Agriculture (Wieś i Rolnictwo), Polish Academy of Sciences (IRWiR PAN), Institute of Rural and Agricultural Development, vol. 3(164).
    2. Farida Titik Kristanti, 2019. "Integrating Capital Structure, Financial and Non-Financial Performance: Distress Prediction of SMEs," GATR Journals afr175, Global Academy of Training and Research (GATR) Enterprise.
    3. Giovanis, eleftheios, 2008. "A Neuro-Fuzzy Approach in the Prediction of Financial Stability and Distress Periods," MPRA Paper 24659, University Library of Munich, Germany.
    4. Eleftherios Giovanis, 2010. "Application of logit model and self‐organizing maps (SOMs) for the prediction of financial crisis periods in US economy," Journal of Financial Economic Policy, Emerald Group Publishing Limited, vol. 2(2), pages 98-125, June.
    5. Sumaira Ashraf & Elisabete G. S. Félix & Zélia Serrasqueiro, 2019. "Do Traditional Financial Distress Prediction Models Predict the Early Warning Signs of Financial Distress?," JRFM, MDPI, vol. 12(2), pages 1-17, April.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:usm:journl:aamjaf00202_75-93. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journal Division, Penerbit Universiti Sains Malaysia (email available below). General contact details of provider: https://edirc.repec.org/data/aammmea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.