Detail publikace

Possibilities for the Application of the Altman Model within the Czech Republic

Originální název

Possibilities for the Application of the Altman Model within the Czech Republic

Anglický název

Possibilities for the Application of the Altman Model within the Czech Republic

Jazyk

en

Originální abstrakt

There are currently a number of formulas that are able to predict the bankruptcy of a company (so-called "bankruptcy prediction formulas"). One of the most frequently mentioned formulas among these models is the Altman Z-score formula. The original version of the formula was intended only for companies listed on the capital market. In 2000, however, a version was published for other companies as well, which significantly broadened the applicability of this formula. The objective of this article is to verify the effectiveness of the 2000 Altman Z-score model within a different environment than which it was conducted. In this case, the environment shall be the Czech Republic or, as the case may be, a modified version of this environment. Despite our expectations, when tested, the model was proven to be significantly less accurate. For this reason we introduced a modification of the formula which has led to an increase in the total accuracy of the formula by 55% within conditions of the Czech Republic and to a decrease of 69% in the number of companies that have not been evaluated.

Anglický abstrakt

There are currently a number of formulas that are able to predict the bankruptcy of a company (so-called "bankruptcy prediction formulas"). One of the most frequently mentioned formulas among these models is the Altman Z-score formula. The original version of the formula was intended only for companies listed on the capital market. In 2000, however, a version was published for other companies as well, which significantly broadened the applicability of this formula. The objective of this article is to verify the effectiveness of the 2000 Altman Z-score model within a different environment than which it was conducted. In this case, the environment shall be the Czech Republic or, as the case may be, a modified version of this environment. Despite our expectations, when tested, the model was proven to be significantly less accurate. For this reason we introduced a modification of the formula which has led to an increase in the total accuracy of the formula by 55% within conditions of the Czech Republic and to a decrease of 69% in the number of companies that have not been evaluated.

BibTex


@inproceedings{BUT101283,
  author="Michal {Karas} and Mária {Režňáková} and Vojtěch {Bartoš} and Marek {Zinecker}",
  title="Possibilities for the Application of the Altman Model within the Czech Republic",
  annote="There are currently a number of formulas that are able to predict the bankruptcy of a company (so-called "bankruptcy prediction formulas").  One of the most frequently mentioned formulas among these models is the Altman Z-score formula.  The original version of the formula was intended only for companies listed on the capital market. In 2000, however, a version was published for other companies as well, which significantly broadened the applicability of this formula.  The objective of this article is to verify the effectiveness of the 2000 Altman Z-score model within a different environment than which it was conducted. In this case, the environment shall be the Czech Republic or, as the case may be, a modified version of this environment. Despite our expectations, when tested, the model was proven to be significantly less accurate.  For this reason we introduced a modification of the formula which has led to an increase in the total accuracy of the formula by 55% within conditions of the Czech Republic and to a decrease of 69% in the number of companies that have not been evaluated.",
  booktitle="Recent Reserches in Law Science and Finances: Proceedings of the 4th International conference on Finance, Accounting and Law (ICFA 13)",
  chapter="101283",
  howpublished="print",
  year="2013",
  month="august",
  pages="203--208",
  type="conference paper"
}