Agriculture Listed Company Financial Crisis Warning Research In China

Agricultural listed companies have been playing an important role in China’sagricultural development,but a series of problems have appeared in the process ofdevelopment.14companies were special treated in the49agricultural listedcompanies due to consecutive losses,the negation of the audit or other reasons.And5companies have not been listed for trading on.It says that they have been delisting.This makes the sustained and healthy development of the agricultural listedcompanies face enormous pressure,seriously affecting the optimal allocation ofresources in agricultural capital markets.Also,it has shaken the play of thecontribution of agriculture in China’s economic development.As the financial crisis appears,the reputation of agricultural listed company hasbeen affected.Whether the stock of the agricultural listed companies is traded or notlargely depends on that it whether falls into financial crisis.The financial crisisdirectly affects the normal operations of the companines.It is necessary foragricultural listed companies to establish an effective financial crisis early warningmethod to prevent the occurrence of financial crisis,so that the agricultural listedcompanies in China can develope sustainably.This paper will choose the49agricultural listed companies that have listed bythe end of2010as research samples,dealing with the financial data obtained fromCSMAR database.And then,this paper will conduct agricultural listed companies’financial crisis early warning study from the following aspects:Firstly,a literature review is showing.This part has analyze the past research ofagricultural listed companies’ financial crisis early warning and learn researchmethods and conclusions of the researchers,in order to be inspired.Secondly,analyzing the characteristics of China’s agricultural listed companies,present situation of financial crisis,the main reason leading to agricultural listedcompanies ’financial crisis,in order to lay the foundation for the establishment ofagricultural listed companies’ financial crisis early warning methods. Third,the establishing of agricultural listed companies’ financial crisis earlywarning method.In this paper,a preliminary deal with the60financial indicators ofChina’s agricultural listed companies is did by Stata software.After the test ofsignificant,correlation test,this paper choose the cash ratio,operating capital ratio andother16financial indicators to conduct regression analysis.And then,keep the fivefinancial indicators ultimately selected that meet the requirements to build the Coxmodel.Finally,this paper will make empirical analysis by SPSS17.0.Empirical research shows that,Cox model can be built on the equity-debt ratio,long-term assets suitable rate,the consolidated leverage,the retained earnings pershare and returns on invested capital.And this Cox model can effectively pre-warnChina’s agricultural listed company’s financial crisis.If we choose the averageHazard rate of agricultural listed companies as a warning threshold,we are able todistinguish the normal company easily.If the average Hazard rate of an agriculturallisted company is less than the warning threshold,it is less likely to fall into financialcrisis in the future.