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PREDICTING CORPORATE FINANCIAL DISTRESS THE CASE OF PAKISTAN

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28 Pages : 488-503

http://dx.doi.org/10.31703/gssr.2018(III-III).28      10.31703/gssr.2018(III-III).28      Published : Sep 2018

Predicting Corporate Financial Distress: The Case of Pakistan

Abstract

    In view of corporate lifecycle theory, financial distress is one of the fundamental phase in the life of a firm. Despite being unaffected by Global Financial Crises 2008, that time period proved critical for the corporate sector of Pakistan. This study aims to measures the firm-level financial distress in Pakistan by employing the bankruptcy models of Altman-(1968), Ohlson-(1980), Zmijewski-(1984) and JZ-(2016) for all nonfinancial firms for the years, 2002-2014. The major findings show that Z-score is the best bankruptcy forecast model, followed by Zmijewski model. This study has significance and policy implications as it will help to choose best bankruptcy studies for timely prediction of financial distress leading towards bankruptcy and helps firms to trigger corrective measures thus helping firms from entering into failure.

    Capital Market Efficiency, Strong form Efficiency, Emerging Markets, Dividend Announcement s, Insider Trading

    (1) Ilyas Ahmad
    Assistant Professor,Department of Economics and Business Administration,University of Education, Lahore, Punjab, Pakistan.
    (2) Zahid Ali
    Assistant Professor,Department of Management Sciences,University of Malakand, KP, Pakistan.
    (3) Muhammad Usman
    Assistant Professor, Department of Economics and Business Administration,University of Education, Lahore, Punjab, Pakistan.
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Cite this article

APA

CHICAGO

    CHICAGO : Ahmad, Ilyas, Zahid Ali, and Muhammad Usman. 2018. "Predicting Corporate Financial Distress: The Case of Pakistan." Global Social Sciences Review, III (III): 488-503 doi: 10.31703/gssr.2018(III-III).28

HARVARD

    HARVARD : AHMAD, I., ALI, Z. & USMAN, M. 2018. Predicting Corporate Financial Distress: The Case of Pakistan. Global Social Sciences Review, III, 488-503.

MHRA

    MHRA : Ahmad, Ilyas, Zahid Ali, and Muhammad Usman. 2018. "Predicting Corporate Financial Distress: The Case of Pakistan." Global Social Sciences Review, III: 488-503

MLA

    MLA : Ahmad, Ilyas, Zahid Ali, and Muhammad Usman. "Predicting Corporate Financial Distress: The Case of Pakistan." Global Social Sciences Review, III.III (2018): 488-503 Print.

OXFORD

    OXFORD : Ahmad, Ilyas, Ali, Zahid, and Usman, Muhammad (2018), "Predicting Corporate Financial Distress: The Case of Pakistan", Global Social Sciences Review, III (III), 488-503

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