Business failure prediction using rough sets

Article Abstract:

A study was conducted to predict business failure using rough set analysis. Data were collected from selected Greek banks and showed the significance of a bank's working capital ratios, debt capacity, financial profitability and liquidity. Data showed more accuracy and advantage over results from other methods such as logit analysis and classical discriminant analysis. Advantages include the method's ability to identify crucial facts hidden in data and express them in understandable decision-rules language, and help minimize cost and time of the decision making process.

Banking Institutions, Depository Credit Intermediation, DEPOSITORY INSTITUTIONS, Financial Management, Decision-making, Models, Decision making, Banking industry, Management, Banks (Finance)

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A survey of business failures with an emphasis on prediction methods and industrial applications

Article Abstract:

A comprehensive review of literature on business failures was conducted to determine methods of forecasting business failure. A total of 158 articles were compiled and classified according to country, industrial sector, time period, financial ratios and models or methods used. Findings revealed that the discriminant analysis (DA) procedure was the most popular method for business failure investigations. However, many procedures were developed in the 1980s to overcome the restrictions of DA. The most significance financial ratios were found in the solvency category.

Analysis, Usage, Discriminant analysis

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Prediction of company acquisition in Greece by means of the rough set approach

Article Abstract:

A novel strategy for the forecasting of company acquisition in Greece was developed based on the rough set approach. The rough set-based method utilizes financial characteristics as a variable for distinguishing between acquired and non-acquired firms in Greece. A prediction model based on the rough set approach also provides decision rules that are supported by real examples which describe facts in terms of the most relevant attributes.

Operations Research, Methods, Greece, Economic aspects, Acquisitions and mergers, Business forecasting

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