The Study On Early-Warning Financial Crisis Of Chinese Listed Manufacturing Company

As marketing competition becomes gradually vigorous, enterprises fall in crisis and face more complexity of financial management. With the foreign and domestic related study advanced deeply, the early-warning financial crisis model based on pure traditional financial indicators couldn't satisfy the gradually complexity of company management. In this paper, combined with the reality of China and based on the traditional financial indicators, the writer adds corrupt and governance indicators to build the early-warning financial crisis model.In the view of risk management theory, the writer selects 17 traditional financial indicators and 10 fraud indicators. First, the writer studies the characteristics of sample's index data and does the normal test; then the writer selects the non-parametric method to test significant differences of the indicators between the financial crisis company and the non-financial crisis company, and selects the indicators which have remarkable contribution to the model. Then the writer uses Factor Analysis to reduce indicators and avoid the multi-collinear influence, and selects several variables as the initial variable to build the model. Finally, the writer uses the logistic regression analysis to build two models, one is pure financial indicators model, and another one is added corrupt and governance indicators.The empirical results indicate that the model added corrupt and governance indicators enhances the predicting accuracy compared with the pure financial indicators model, especially the error rate of TypeⅡis greatly reduced. This suggested that, indicators related to corrupt and governance should be more joined in examining the financial situation of enterprises, so we can predict financial crises in the root.