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Applicability of Altman's revised model in predicting financial distress: a case of PN17 companies quoted in Malaysian Stock Exchange

Ng , Kim Soon and Mohammed , Ali Abusalah Elmabrok and Ahmad, Abd. Rahman and Huam , Hon Tat (2013) Applicability of Altman's revised model in predicting financial distress: a case of PN17 companies quoted in Malaysian Stock Exchange. In: Proceedings of The 20th International Business Information Management Association Conference, 25-26 March 2013, Kuala Lumpur, Malaysia.

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Abstract

A Practice Note 17 (PN17) Company is a listed company in the Malaysian Stock Exchange that is financially distressed or does not have a core business or has failed to meet minimum capital or equity (Less than 25% of the paid up capital). Financial analysis method can be used to detect the failure of this company. As of 9th August 2010, there are still thirty four companies listed on Malaysian SE, classified under the PN17 List. These companies have entered into the PN 17 list in accordance with the existing standards. There are also investors who do not know the status of these listed companies. A real and full attention has not yet been given to these companies. Analytical studies and scientific researches are almost still lacking on the PN17 Malaysian Companies. The aims of this research are to examine the Applicability of Altman Z score in determining the financial failure companies, use Altman Z Score to examine whether there is a successful company between PN17 companies listed in the Stock Exchange of Malaysia. Furthermore, to determine whether all the PN17 Companies are listed in Malaysian Stock Exchange financial failure companies, to examine the reports of the financial situation of companies listed on Bursa Malaysia Statistical lists to analyze the data. This study answered the research questions formulated. The analysis of this study was made on a sample of 52 Companies where these financial data were collected from the records over the period from 2003 to 2010. This study found that not all the PN17 Companies are financial failure Companies. Altman Z score can be used to detect financial distress of a company.

Item Type: Conference or Workshop Item (Paper)
Uncontrolled Keywords: stock exchange; financial analysis; distress companies; investments
Subjects: H Social Sciences > HG Finance
Divisions: Faculty of Technology Management and Business > Department of Technology Management
Depositing User: Normajihan Abd. Rahman
Date Deposited: 10 Sep 2013 03:50
Last Modified: 21 Jan 2015 08:12
URI: http://eprints.uthm.edu.my/id/eprint/4119
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