A Financial Distress Early-warning Model Based On T~2 Control Chart

The study on early-warning financial distress has a great significance. Based on the daily financial data we can predict the company's financial operating condition and judge whether there is a financial distress in advance. The early-warning financial distress model plays a preventive role in early warning.There are many study on the statistical quality control theory and the techniques of statistical quality control has successfully applied in many fields. In fist, this paper introduces the concepts of the early-warning financial distress ,the concept of financial distress and the selection of financial indicators. Then, it highlighting introduces the development and theory of the quality control chart, proposes to apply statistical quality control chart on the financial early-warning system and establishes a financial distress early-warning model of T~2control chart .Finally, we choose 10 ST companies and non-ST companies as samples,build the model of financial distress early-warning using T~2 control chart, and use the Logistic analysis to build model, and then compare and analyze the two models.Through using test samples, the model can forecast the financial distress well, and is easy to judge. The second misjudgment rate of this control chart model is lower. It's helpful for the development of the early-warning financial crisis research.