The relation between corporate governance and financial distress-base on Taiwan stock exchange as example

• Main Authors: Fu Li Lee, 李復禮
• Other Authors: Wen Rong Ho
• Format: Others
• Language: zh-TW
• Published: 2006
• Online Access: http://ndltd.ncl.edu.tw/handle/70785443875801670712

碩士 === 開南管理學院 === 財務金融系碩士班 === 94 === In Taiwan, the capital marketing has developed more and more maturely with the economy growth; but it continues to happen that there are some listed companies create financial crises and result in the loss of money for stockholders. In recent years, Taiwan’s government focuses on the supervision of corporate governance and sets up a Financial Supervisory Commission as a market monitoring system to prevent companies from financial crises such as fraudulent insolvency. In consideration of the importance of company monitoring system and pluralism of methods to predict company financial crises, the study adopts (a)Discriminant analysis, (b)Logit regression analysis and (c)Artificial Neural-Network. The purpose of this study is to find out the most accurate model to predict listed-company financial warning which may result in bankruptcy. We start with applying the “Factor Analysis” to sift out the variables and use these variables to build up the Discriminant analysis and the Logit regression analysis model. The conclusion of this study is as follows: 1. The liquidity ratio and the coverage ratio are the best variables to explain the difference among samples. Study suggests that companies which have many short-term debts are the main reason to cause financial crises. 2. Out of the three methods, Artificial Neural-Network makes the most accurate prediction. The accuracy of anticipation in past three years of financial crises is 93.75% 78.12% 78.12% respectively. 3. The study also reveals that the variables of corporate governance could not adds the accuracy of anticipation , so we conclude that the governmental enforcement on corporate governance has in fact not worked.