Contrast prediction models of financial failure in determining the financial position of companies An Empirical Study on the insurance companies listed on the Damascus Securities Exchange


Abstract in English

This research aims to test the reliability of the financial failure prediction models most commonly used in determining the financial position of the insurance companies listed on the Damascus Securities Exchange (DSE). To achieve the objectives of the research has been applied models of both Altman, Sherrod and Kida insurance companies listed on the DSE, where the study included the entire research community, consisting of six insurance companies Were subjected to the results obtained through the application of the three models to the data to insurance companies studied non parametric tests in order to ascertain whether the discrepancy results of these models are essential or not. The results of the application of models (Sherrod, Altman and Kida) on data insurance companies studied showed a clear contrast between a typical Altman and Sherrod on the one hand and Kida model on the other hand, the nonparametric statistical tests showed that the differences between the three models is significant variation spirits. The research concluded that it cannot rely on these models to determine the financial position of insurance companies studied.

References used

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ALTMAN E, 2000- Predicting financial distress of companies: revisiting the Z-score and ZETA® models. New York University, USA, 54p
KIDA T 1980 An investigation into auditors’ continuity and related qualification judgments, Journal of Accounting Research, Vol. 18. N° 2. 506-523
ODIPO M.K and SITATI A, 2011- Evaluation of applicability of altman's revised model in prediction in financial distress: A case of companies quoted in the Nairobi stock exchange. Unpublished master dissertation, University of Nairobi, Kenya, 41p
ORABI M.M 2014 Empirical Tests on Financial Failure Prediction Models, Interdisciplinary Journal of Contemporary Research in Business, Vol. 5. N° 9. 29-43

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