TY - GEN

T1 - Financial Distress Prediction: Challenges for Emerging Markets

AU - Абрамишвили, Н.Р.

AU - Дарушин, И.А.

AU - Львова, Н.А.

PY - 2012

Y1 - 2012

N2 - Financial distress prediction models, a powerful tool of risk management, needs constant perfection. This is particularly important for emerging markets, with their highly unstable economic situation. In the light of the foregoing, we deal with the challenges of financial prediction in countries with emerging markets. Data from the securities market is often used in corresponding models. However, it is necessary to know to what extent the data about the market value of corporate securities reflects the actual state. We analyze the main disproportions of emerging securities market development and come to conclusion that the information obtained from it cannot be fully used for financial diagnostics. In particular, despite the significant advantages of the market-based models for financial distress prediction, analysts on emerging markets tend to prefer models that are based on financial statements. The problem is that accounting-based models have significant drawbacks. Therefore, methods that enable the applic

AB - Financial distress prediction models, a powerful tool of risk management, needs constant perfection. This is particularly important for emerging markets, with their highly unstable economic situation. In the light of the foregoing, we deal with the challenges of financial prediction in countries with emerging markets. Data from the securities market is often used in corresponding models. However, it is necessary to know to what extent the data about the market value of corporate securities reflects the actual state. We analyze the main disproportions of emerging securities market development and come to conclusion that the information obtained from it cannot be fully used for financial diagnostics. In particular, despite the significant advantages of the market-based models for financial distress prediction, analysts on emerging markets tend to prefer models that are based on financial statements. The problem is that accounting-based models have significant drawbacks. Therefore, methods that enable the applic

KW - Emerging markets

KW - market efficiency

KW - financial distress prediction

M3 - Conference contribution

SN - 978-80-260-2184-1

BT - Multidisciplinary academic research 2012 [CD-Rom]: materials of the 1st Multidisciplinary Academic Conference, AV consulting o.s., Czech Technical University in Prague (CTU), December 6-7, 2012

ER -