Predicting the Outcomes of Financial Difficulties:Adding a Variable of “Advances from Customers”

• Main Authors: I-Chen Chen, 陳怡蓁
• Other Authors: 沈仰斌
• Format: Others
• Language: en_US
• Published: 2010
• Online Access: http://ndltd.ncl.edu.tw/handle/14537304692583356514

碩士 === 元智大學 === 財務金融學系 === 98 === This paper generalizes previous studies and adds a variable of “advances from customers” to distinguish firms to be successful or failed after financial difficulties. The empirical results indicate that firms with financial difficulties do not ask for help from their customers immediately in the event year, but will ask for help a year or two years after. However, this kind of help does not save them from difficulties. We also prove that suppliers with close relationships with their customers have lower probabilities to success after encountering financial difficulties. In robustness tests, after considering the industrial effects, receiving “advances from customers” cannot effectively distinguish whether firms will be successful.