Research On Financial Early Warning Of The Listed Companies In China

The lengthy development process of global economy followed a wavy patternwhich involved prosperity and recession. In the former stage, the economy is doingwell and people’s living standard is highly increased, in addition, the operationalrisks faced by the corporation are lower. In the later stage, however, the economygrows slowly and the economic environment is complicate and volatile, meanwhile,operational risks are distinctly increased. Many scholars both home and abroadbegan to recognize the importance of financial crisis based on these macro-economicbackgrounds, and devoted themselves to studying the financial early-warning systemone after another in order to avoid these crises effectively. So far, many scholarshave built early-warning systems which are in line with their national conditionsafter years of painstaking research.The construction of market economy system in our country is following behindthe western as well as the financial early-warning area. After years of efforts,however, scholars achieved fruitful results which provided foundation and referencefor corporations managing the financial crisis in our country.This paper introduces the research thinking and methods at first, and thenpresents the theories related to financial crisis, and at last build the financialearly-warning model based on the public company in our country. Samples selectedin this study are the special treated public companies in2010and2011. The authorchooses37indicators, both financial and no-financial, and then uses significance testand factor analysis methods to process these data. By using Logistic Regressionmethod, the author builds financial early-warning model, which is also passed thevalidity test. At last, based on those above analysis, this paper reaches a conclusionand puts forward reasonable suggestions.