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Journal article Open Access Scopus Source The journal / series is indexed in Scopus (SCImago list). The article itself has not been verified. 3 Citations Quartil Q3 Peer Reviewed

Classification of bankruptcy with cash flow information: Evidence from small size firms

Lious Ntoung Agbor Tabot , Helena Maria Santos de Oliveira , Cláudia M. F. Pereira
ISLA — Instituto Politécnico de Gestão e Tecnologia
Corporate Board role duties and composition, Volume 12, Issue 2, 2016, pp. 86–95
DOI: 10.22495/cbv12i2c1art3

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Abstract
Corporate financial ratios have been debated in the past as the most importance measures in predicting corporate failure, yet gaps remain in the literature about cash flow information in classifying between bankrupted and non-bankrupted firms. This study test whether cash flow components is more useful in classifying bankrupted and non-bankrupted of small and unlisted firms in Spain. The results of this study suggest that cash flows components are superior to financial ratios for classifying small failed and non-failed companies with the logit model. Particularly, most failing firms, reduce or avoid paying dividend to their owner. This reduction or the absence of dividend payments as a proportion of total outflow is often related to either a significant decrease in the net operating inflow and/or an increase in the relative outflow to fixed charges resulting from increased external debt financing.

Keywords

#bankruptcy prediction #cash flow components #small business #unlisted firms #financial ratios #dividends #business failure #fixed charges #external debt financing #Spanish companies #cash flow #Bankruptcy #Outflow #business #Inflow #Monetary economics

Bibliographic Details

Publication Type Journal article
Publication Year 2016
Journal / Conference / Work Corporate Board role duties and composition
ISSN 2520-8780
ISBN 9789811563690
Volume / Issue Vol. 12 (2)
Pagination pp. 86–95
Publication Status Published
Quartile (SCImago) Q3
Scopus Indexing Indexed source (via SCImago)

ISLA Authors & Affiliations

C
Cláudia Maria Ferreira Pereira
claudiap@iscap.ipp.pt ID: C912-6892-F41A
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H
Helena Maria Santos de Oliveira
hmoliveira@sapo.pt ID: EA1D-FBAB-40CC
Profile