Models to Assess the Bankruptcy Risk

Closely related to financial risk assessment, one of the main concerns of the organizations should be the evaluation of bankruptcy risk, in this period of slow economic growth. Organization bankruptcies have increased in recent years worldwide. The aim of this paper is to demonstrate that the method...

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Published inAnalele Universității "Dunărea de Jos" Galați. Fascicula I, Economie și informatica aplicata no. 2; pp. 59 - 66
Main Authors Simona Valeria TOMA, Ioana Veronica ALEXA, Daniela Ancuţa SARPE
Format Journal Article
LanguageEnglish
Published Dunarea de Jos University of Galati 01.08.2013
Subjects
Bankruptcy risk
Risk
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Summary:Closely related to financial risk assessment, one of the main concerns of the organizations should be the evaluation of bankruptcy risk, in this period of slow economic growth. Organization bankruptcies have increased in recent years worldwide. The aim of this paper is to demonstrate that the methods and models for forecasting bankruptcy of organizations, for the bankruptcy risk assessment are seeing for the health financing of an entity in financial accounting diagnosis and that the organizations requires assessment of risks accompanying the work, in which some signals fragility (vulnerable health) this and other projected bankruptcy (insolvability) threatens its survival (continuity). The bankruptcy risk assessment is important for profit-seeking investors because they must know how to value a company in or near bankruptcy is an important skill, but to detect any signs of looming bankruptcy is necessary to calculate and to analyse all kinds of financial rations: working capital, profitability, debt levels and liquidity.
ISSN:1584-0409
1584-0409