Study On Financial Pre-warning Of Chinese Real Estate Listed Companies Based On Extensive Theory

Along with the development of Chinese real estate market and securities market, the number and size of Chinese real estate listed companies have grown with the size of the market competition which is becoming increasingly fierce. Any real estate listed companies may plunge into the financial distress. If this can't be discovered in a timely manner and effectively resolved, enterprises will be in the trouble of survival crisis. Meanwhile it will cause huge losses to linked interests of enterprises and related parties, thus a chain reaction and a vicious circle will take place which will make adverse impact on macroeconomic environment. In order to standardize the operation of Chinese real estate listed companies and supply the basis to investors and regulatory authorities, the demand to establish effective financial early warning model has become more and more pressing. Study on financial pre-warning of Chinese real estate listed companies not only has higher academic value, but also has enormous practical significance.On the study about traditional financial pre-warning assessment method, this paper introduces the method of extension method which is based on the theory of matter-element to study on the financial pre-warning of Chinese real estate listed companies. This paper describes the fundamental principles of the extension theory, including the basic concept such as matter-element theory, extension set and correlation function. The paper summed up the basic principles and the application of extension method, and carried out extensive analysis to the financial pre-warning of Chinese real estate Combined with the former theory and practice, this paper chooses 55 real estate listed companies in Chinese Shanghai and Shenzhen A-share market as the research samples, and chooses their basic data in 2007 as the pre-warning data of the model. This paper establishes pre-warning index system including solvency indicators, size indicators, profitability indicators, development capacity indicators and macroeconomic indicators with 11 forecasting indexes. On this basis, we combine financial indicators with non-financial indicators to establish a extensive judgment model about financial pre-warning of Chinese real estate listed companies. Through testing and empirical study of model forecasting results with the financial data and the actual development of the research samples in2008-2009, this paper proves that extensive pre-warning model can accurately judge the financial situation of Chinese real estate listed companies, forecast the financial trend of Chinese real estate listed companies, and dynamically provide a basis of decision-making and support for the main parties related.