The Early Warning Of Financial Distress For Chinese Listed Companies

Production and operations is effected by the combined effects of internal and external environmental factors, facing complex and volatile external environment, companies need to take timely measures to deal with change; for corporate governance structure, staffing, cultural institutions, and other internal environment factors that are controllable, companies should be early detection and timely treatment. The managers within the enterprise environment as an important factor, it can develop the company's development strategy, the implementation of reform and innovation, and check investment management decisions, and create a corporate culture and other development that have an important impact on the company.Different manager will have different effects on company, good manager may cause benign operation of enterprises, bad managers may make bad business crisis. Also, because the manager's characteristics will affect their decision-making behavior, thus act on the company's operating conditions. Therefore, this feature based on the perspective of the manager's feature, using SVM method to construct financial distress early warning model, in order to make timely and effective forecast for business situation, and to prevent corporate financial distress occur.This paper first review and analyze the researches of the relationshipbetween managers and financial distress and early warning of Financial Dilemma. Then establish the study objects that are listed manufacturing companiesin China from 2008 to 2014, basing on managers feature perspective, using SVM built the model of early warning of Financial Dilemma. On this basis, select the Shanghai and Shenzhen A-share listed 100 manufacturing companies as samples, of which 50 for the ST companies, 50 non-ST companies. Select team managers average tenure, age, education, professional background, remuneration and shareholding ratio as manager characteristic index, correlation analysis by using SPSS software company manager feature index and performance indicators, then extract notablefeature index that relate to Corporate Performance, and constitute Sample collection with the company operating status. Using SVM built the model of early warning of Financial Dilemma. The training set into the model is solved to obtain a better prediction of early warning model, and then by choosing manager features of IT Industry and Wholesale and Retail Trade,also differentiating nature of property rights of manufacturing sample to test the model robustness, the results of prediction of model's correct rate reaches more than 90%, which can explain: on the one hand the features of non-ST company and ST company managers do exist differences, the company's managers have a characteristic ST class similarity, manager features non-ST companies there is an additional in a similar resistance, and to some extent would make influences on the company to fall in financial difficulties. On the other hand warning model has high stability and good prediction, in the course of business, we can take advantage of the early-warning model to predict whether the company has the possibility of falling financial trouble, so as to provide the company's personnel decisions that basing on the scientific method, in order to adjust the company's governance policies and staffing, to avoid greater losses.