PREDICTION OF FINANCIAL DISTRESS BASED ON ACCOUNTING INFORMATION
When a company goes through a period of economic uncertainty, and its ability to keep operating in the foreseeable is called into question, all stakeholders are affected. In terms of economics a failure means that a company can’t respect the economic principle of going concern, in some situations...
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University of Oradea
2023-12-01
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| Series: | Annals of the University of Oradea: Economic Science |
| Subjects: | |
| Online Access: | https://anale.steconomiceuoradea.ro/en/wp-content/uploads/2024/03/Volume-2_AUOES_december-2023-139-147.pdf |
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| _version_ | 1846150603149934592 |
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| author | Dorotheea-Beatrice-Ruxandra CHIOSEA Camelia-Daniela HAȚEGAN |
| author_facet | Dorotheea-Beatrice-Ruxandra CHIOSEA Camelia-Daniela HAȚEGAN |
| author_sort | Dorotheea-Beatrice-Ruxandra CHIOSEA |
| collection | DOAJ |
| description | When a company goes through a period of economic uncertainty, and its
ability to keep operating in the foreseeable is called into question, all stakeholders
are affected. In terms of economics a failure means that a company can’t respect
the economic principle of going concern, in some situations reaching insolvency or
even bankruptcy. The research objective is identifying the key elements regarding
the going concern of the companies' activity, and the accounting aspects which are
contributing to the analysis of the level of risk faced by a company. According to the
accounting rules, the management of the entities bears the responsibility for the
preparation of financial statements in accordance with this principle. The hypothesis
from which this research starts is that the models of discriminative analysis are the
only way to verify the going concern assessment for a long-term period. Following
the research, the factors that contribute to the assessment of the principle of going
concern were identified, as well as an example of discriminative analysis to assess
the risk of bankruptcy that an entity may face, or not in the foreseeable future. The
research is based on going concern assessment, but also regarding the usefulness
of data collection for business development. At the same time, a series of threats
regarding the decision-making processes are pointed out, which may affect the
activities of companies. The potential contribution of the study is to develop the
literature on a current topic that should be a constant concern of companies, and it
can highlight the usefulness of discriminative analysis to predict the financial
distress a company may face. |
| format | Article |
| id | doaj-art-657d5cb4ff63463b818f48deba394e3f |
| institution | Kabale University |
| issn | 1222-569X 1582-5450 |
| language | deu |
| publishDate | 2023-12-01 |
| publisher | University of Oradea |
| record_format | Article |
| series | Annals of the University of Oradea: Economic Science |
| spelling | doaj-art-657d5cb4ff63463b818f48deba394e3f2024-11-28T11:45:23ZdeuUniversity of OradeaAnnals of the University of Oradea: Economic Science1222-569X1582-54502023-12-0132213614410.47535/1991AUOES32(2)013PREDICTION OF FINANCIAL DISTRESS BASED ON ACCOUNTING INFORMATIONDorotheea-Beatrice-Ruxandra CHIOSEA0Camelia-Daniela HAȚEGAN1Doctoral School of Economics and Business Administration, West University of Timișoara, RomaniaDoctoral School of Economics and Business Administration, West University of Timișoara, RomaniaWhen a company goes through a period of economic uncertainty, and its ability to keep operating in the foreseeable is called into question, all stakeholders are affected. In terms of economics a failure means that a company can’t respect the economic principle of going concern, in some situations reaching insolvency or even bankruptcy. The research objective is identifying the key elements regarding the going concern of the companies' activity, and the accounting aspects which are contributing to the analysis of the level of risk faced by a company. According to the accounting rules, the management of the entities bears the responsibility for the preparation of financial statements in accordance with this principle. The hypothesis from which this research starts is that the models of discriminative analysis are the only way to verify the going concern assessment for a long-term period. Following the research, the factors that contribute to the assessment of the principle of going concern were identified, as well as an example of discriminative analysis to assess the risk of bankruptcy that an entity may face, or not in the foreseeable future. The research is based on going concern assessment, but also regarding the usefulness of data collection for business development. At the same time, a series of threats regarding the decision-making processes are pointed out, which may affect the activities of companies. The potential contribution of the study is to develop the literature on a current topic that should be a constant concern of companies, and it can highlight the usefulness of discriminative analysis to predict the financial distress a company may face. https://anale.steconomiceuoradea.ro/en/wp-content/uploads/2024/03/Volume-2_AUOES_december-2023-139-147.pdfgoing concernfinancial difficultyaccountingriskuncertainty |
| spellingShingle | Dorotheea-Beatrice-Ruxandra CHIOSEA Camelia-Daniela HAȚEGAN PREDICTION OF FINANCIAL DISTRESS BASED ON ACCOUNTING INFORMATION Annals of the University of Oradea: Economic Science going concern financial difficulty accounting risk uncertainty |
| title | PREDICTION OF FINANCIAL DISTRESS BASED ON ACCOUNTING INFORMATION |
| title_full | PREDICTION OF FINANCIAL DISTRESS BASED ON ACCOUNTING INFORMATION |
| title_fullStr | PREDICTION OF FINANCIAL DISTRESS BASED ON ACCOUNTING INFORMATION |
| title_full_unstemmed | PREDICTION OF FINANCIAL DISTRESS BASED ON ACCOUNTING INFORMATION |
| title_short | PREDICTION OF FINANCIAL DISTRESS BASED ON ACCOUNTING INFORMATION |
| title_sort | prediction of financial distress based on accounting information |
| topic | going concern financial difficulty accounting risk uncertainty |
| url | https://anale.steconomiceuoradea.ro/en/wp-content/uploads/2024/03/Volume-2_AUOES_december-2023-139-147.pdf |
| work_keys_str_mv | AT dorotheeabeatriceruxandrachiosea predictionoffinancialdistressbasedonaccountinginformation AT cameliadanielahategan predictionoffinancialdistressbasedonaccountinginformation |