Title: Construction measures of bankruptcy: case study of Polish enterprises

Authors: Natalia Nehrebecka; Aneta Dzik-Walczak

Addresses: Faculty of Economic Sciences, Warsaw University, Krakowskie Przedmieście 26/28, 00-927 Warszawa, Poland; National Bank of Poland Świętokrzyska 11/21, Warszawa, Poland ' Faculty of Economic Sciences, Warsaw University, Krakowskie Przedmieście 26/28, 00-927 Warszawa, Poland

Abstract: The paper presents a model assigning a bankruptcy probability to a company, developed on the basis of individual data from balance sheets and income statements of Polish companies in the 2001-2010 period. The research was based on a logistic regression performed on categorised variables transformed using a weight of evidence approach. In the forecasting model of a possible bankruptcy in a year's horizon the highest weight was assigned to the indicator for the ability to cover financial costs which explained the company's ability to meet the interest payments and capital costs. In the more generalised model which accounts for the macroeconomic situation the most important was the indicator for the ability to pay off debt. In the model forecasting bankruptcies three-years in advance - the early warning model - no dominant indicator was found.

Keywords: bankruptcy probability; microdata; Polish enterprises; scoring methods; case study; Poland; forecasting models; financial costs; interest payments; capital costs; macroeconomics; debt payments; early warning.

DOI: 10.1504/GBER.2016.076234

Global Business and Economics Review, 2016 Vol.18 No.3/4, pp.420 - 444

Received: 14 Mar 2014
Accepted: 13 Aug 2014

Published online: 28 Apr 2016 *

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