Research On Financial Distress Prediction Based On Manufacturing A-share Listed Companies

Corporate financial distress prediction is a major research domain of corporate finance. The occurrence of the financial distress is a progressive process, so it has some omens and can be predicted. This paper uses our country’s listed manufacturing companies to establish a Financial Distress model and to predict the future by using this model.In this paper "financial distress company" is defined as ST company who is special-traded because of abnormal financial conditions. Basing on this definition,41new ST listed manufacturing companies from2009to2011and its1:2matched82non-ST companies are selected as modeling sample. This paper selects the2012’s listed manufacturing companies as test sample to test the model and uses the model to predict the possibility of listed manufacturing companies being in financial distress in2013.In the selection of indexes, this paper selects financial indexes and introduces non-financial indexes such as corporate governance. Using logistic regression model, this paper constructs financial distress prediction models basing on financial indexes only and both financial indexes and non-financial indexes.The research results show that the introduction of corporate governance indexes can improve the explanatory power and prediction accuracy rate of model.Corporate governance indexes play an important role in financial distress prediction.