Statistics

Business

Distress

Logistic regression

Variables

Psychotherapist

Financial ratio

Debt

Debt ratio

Financial distress

Finance

Econometrics

Psychology

Financial system

Logit

Actuarial science

Economics

Mathematics

This study revisited the prediction of financial distress companies in the mixed sector in Malaysia. This is achieved by using PN4 companies as the dependent variable and financial ratios as the independent variables. Logit Analysis was used because the dependent variable is binary or dichotomous in nature. It shows the probability of a company being financially distressed and it provides the coefficient value (positive or negative) of the independent variables (s) that are used as predictors. The results show that debt ratio and working capital ratio were significant in predicting financial distress companies in the mixed sector in Malaysia. The findings from the internal validation reveal that the prediction model provided a more than 50% chance that the model is accurate. However, the findings from the external validation indicate that the model might not be able to be used outside the estimation time period because the overall percentage accuracy was only slightly higher than 50% for five years before dis...

Prediction of financial distress companies in the mixed sector in Malaysia: a revisit using PN4 data