Enhancing procedural efficiency in multiple-industry ratio-based modeling of corporate collapse
Hossari, Ghassan 2010, Enhancing procedural efficiency in multiple-industry ratio-based modeling of corporate collapse, International review of business research papers, vol. 6, no. 1, pp. 99-107.
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Title
Enhancing procedural efficiency in multiple-industry ratio-based modeling of corporate collapse
This paper utilizes a methodological approach called Multi-Level Modeling (MLM) that addresses two major shortcomings in the two step analytic process that is traditionally adopted in the pertinent literature for modeling corporate collapse; thereby, enhancing procedural efficiency. The robustness of MLM vis-à-vis the traditional two-step procedure is ascertained using a data sample of Australian publicly listed companies, equally split between collapsed and non collapsed, during the period 1989 to 2006. The results indicate that not only does MLM improve procedural efficiency, it does so while enhancing the robustness of signaling corporate collapse; in particular, MLM signals collapse with an overall 6.6% increase in accuracy.
Language
eng
Field of Research
150103 Financial Accounting
Socio Economic Objective
970115 Expanding Knowledge in Commerce, Management, Tourism and Services