Research On Financial Early-warning Models Of Listed Companies

As we all know,the financial position of the business has always been the focus of all stakeholders,including business owners,shareholders,creditors,etc.Good financial position will bring business owners more intersets and attract more investment.It could improve the financing capacity and capital scale of the enterprise.For the business operators,the good financial situation of the enterprise means that the manager's management strategy and marketing means are effective,and the operator can obtain higher salary and excellent record of performance.For the creditors,the good financial situation of the enterprise means that it has the basic ability to repay the debt,which can guarantee the creditor's maturity to recover the loans and interests.In the contrary,financial crisis will bring huge losses to shareholders,business owners and business operators.At present,because of the economic depression,lack of risk prevention and control measures,policy adjustments and other series of factors,some listed companies' market share has declined and the cash flow is insufficient.Therefore they don't have enough fund to invest,even in a loss.Then,they will face the final special treatment.Stakeholders have to suffer from enormous losses.Therefore,the real time monitoring and financial crisis early warning of listed companies are not only the urgent demand of stakeholders,but also become a hot domestic research.The purpose of building financial distress forewarning model is to help companies to take appropriate measures in accordance with the early warning signals.Meanwhile it also have important guiding significance to assist the national securities regulatory authorities on monitoring the quality of listed companies and reducing market risk.This paper introduces the relevant concepts of financial early warning and related theoretical basis firstly.Financial crisis is also known as financial distress.Listed companies with "special treatment"(ST)are defined as companies with financial distress in the vast majority of the research in China.Therefore,this paper uses the definition of financial distress in the academic circles of our country,and holds that enterprises will fall into financial crisis if they have deficit more than two years in a row.Then this paper selects the financial data from the A-shares of listed companies which were special treated in 2016 and the non-ST companies in accordance with the proportion of 1:4 which were the same industry and similar size as the ST companies to calculate the Ohlson indexes,Altman indexes and the dynamic financial indexes.Next,we use SVM model and ANN model to establish financial distress forewarning model separately in the base of half samples and use the rest to examine the effectiveness of the financial early-warning model,and compare the effects of the determination among the SVM model and the ANN model.Empirical analysis shows that we can find financial distress through financial indexes system,and the financial early-warning models we established are effective in predicting whether companies will fall into financial crisis in the base of comprehensive accounting index system.By contrast,the SVM model we established can determine more effectively whether the company will fall into financial crisis than the ANN model.