Predicting corporate failure: an application of Altman's Z-score and Altman's EMS models to the JSE Alternative Exchange from 2008 to 2012
Master Thesis
2014
Permanent link to this Item
Authors
Journal Title
Link to Journal
Journal ISSN
Volume Title
Publisher
Publisher
University of Cape Town
Department
Faculty
License
Series
Abstract
The JSE Alternative Exchange (Alt-X) experienced a dramatic decline in equity values from 2008 to 2009 as part of the global economic crisis of approximately 60, and has subsequently experienced a decline of a further 50 from 2009 to 2012. By way of comparison, the JSE Main Board declined approximately 33 in 2008 and 2009, and has subsequently experienced a 100 increase in equity values from 2009 to 2012. The extent of the decline in equity values of companies listed on the Alt-X has raised the issue as to whether companies listed on the Alt-X have a higher likelihood of corporate failure. This study applies the Altman Z-Score and the Altman Z'EM score in order to identify trends in corporate solvency of Alt-X listed companies. Thereafter bond equivalent ratios are calculated for further analysis.
Description
Includes bibliographical references.
Reference:
Coelho, M. 2014. Predicting corporate failure: an application of Altman's Z-score and Altman's EMS models to the JSE Alternative Exchange from 2008 to 2012. University of Cape Town.