A comparison of alternative bankruptcy prediction models

Early models of bankruptcy prediction employed financial ratios drawn from pre-bankruptcy financial statements and performed well both in-sample and out-of-sample. Since then there has been an ongoing effort in the literature to develop models with even greater predictive performance. A significant innovation in the literature was the introduction into bankruptcy prediction models of capital market data such as excess stock returns and stock return volatility, along with the application of the Black–Scholes–Merton option-pricing model. In this note, we test five key bankruptcy models from the literature using an upto- date data set and find that they each contain unique information regarding the probability of bankruptcy but that their performance varies over time. We build a new model comprising key variables from each of the five models and add a new variable that proxies for the degree of diversification within the firm. The degree of diversification is shown to be negatively associated with the risk of bankruptcy. This more general model outperforms the existing models in a variety of in-sample and out-of-sample tests.

Prediction of structural integrity, robustness and service life using advanced finite element methods

Corrosion is a common phenomenon and critical aspects of steel structural application. It affects the daily design, inspection and maintenance in structural engineering, especially for the heavy and complex industrial applications, where the steel structures are subjected to hash corrosive environments in combination of high working stress condition and often in open field and/or under high temperature production environments. In the paper, it presents the actual engineering application of advanced finite element methods in the predication of the structural integrity and robustness at a designed service life for the furnaces of alumina production, which was operated in the high temperature, corrosive environments and rotating with high working stress condition.

New percentage body fat prediction equations for Japanese females

Anthropometry is a simple and cost-efficient method for the assessment of body composition. However prediction equations to estimate body composition using anthropometry should be ‘population-specific’. Most popular body composition prediction equations for Japanese females were proposed more than 40 years ago and there is some concern regarding their usefulness in Japanese females living today. The aim of this study was to compare percentage body fat (%BF) estimated from anthropometry and dual energy x-ray absorptiometry (DXA) to examine the applicability of commonly used prediction equations in young Japanese females. Body composition of 139 Japanese females aged between 18 and 27 years of age (BMI range: 15.1–29.1 kg/m2) was measured using whole-body DXA (Lunar DPX-LIQ) scans. From anthropometric measurements %BF was estimated using four equations developed from Japanese females. The results showed that the traditionally employed prediction equations for anthropometry significantly (p<0.01) underestimate %BF of young Japanese females and therefore are not valid for the precise estimation of body composition. New %BF prediction equations were proposed from the DXA and anthropometry results. Application of the proposed equations may assist in more accurate assessment of body fatness in Japanese females living today.

Preliminary study on bridge health prediction using Dynamic Objective Oriented Bayesian Network (DOOBN)

The availability of bridges is crucial to people’s daily life and national economy. Bridge health prediction plays an important role in bridge management because maintenance optimization is implemented based on prediction results of bridge deterioration. Conventional bridge deterioration models can be categorised into two groups, namely condition states models and structural reliability models. Optimal maintenance strategy should be carried out based on both condition states and structural reliability of a bridge. However, none of existing deterioration models considers both condition states and structural reliability. This study thus proposes a Dynamic Objective Oriented Bayesian Network (DOOBN) based method to overcome the limitations of the existing methods. This methodology has the ability to act upon as a flexible unifying tool, which can integrate a variety of approaches and information for better bridge deterioration prediction. Two demonstrative case studies are conducted to preliminarily justify the feasibility of the methodology

Theoretical and numerical investigation of bending properties of Cu nanowires

Based on the AFM-bending experiments, a molecular dynamics (MD) bending simulation model is established which could accurately account for the full spectrum of the mechanical properties of NWs in a double clamped beam configuration, ranging from elasticity to plasticity and failure. It is found that, loading rate exerts significant influence to the mechanical behaviours of nanowires (NWs). Specifically, a loading rate lower than 10 m/s is found reasonable for a homogonous bending deformation. Both loading rate and potential between the tip and the NW are found to play an important role in the adhesive phenomenon. The force versus displacement (F-d) curve from MD simulation is highly consistent in shapes with that from experiments. Symmetrical F-d curves during loading and unloading processes are observed, which reveal the linear-elastic and non-elastic bending deformation of NWs. The typical bending induced tensile-compressive features are observed. Meanwhile, the simulation results are excellently fitted by the classical Euler-Bernoulli beam theory with axial effect. It is concluded that, axial tensile force becomes crucial in bending deformation when the beam size is down to nanoscale for double clamped NWs. In addition, we find shorter NWs will have an earlier yielding and a larger yielding force. Mechanical properties (Young’s modulus & yield strength) obtained from both bending and tensile deformations are found comparable with each other. Specifically, the modulus is essentially similar under these two loading methods, while the yield strength during bending is observed larger than that during tension.

Associations between young children's emotion attributions and prediction of outcome in differing social situations

Associations between young children's attributions of emotion at different points in a story, and with regard to their own prediction about the story's outcome, were investigated using two hypothetical scenarios of social and emotional challenge (social entry and negative event). First grade children (N = 250) showed an understanding that emotions are tied to situational cues by varying the emotions they attributed both between and within scenarios. Furthermore, emotions attributed to the main protagonist at the beginning of the scenarios were differentially associated with children's prediction of a positive or negative outcome and with the valence of the emotion attributed at the end of the scenario. Gender differences in responses to some items were also found. © 2010 The British Psychological Society.

The nature of juristic paradigms : exploring the theoretical and conceptual relationship between adversarialism and therapeutic jurisprudence

Problem solving courts appear to achieve outcomes which are not common in mainstream courts. There are increasing calls for the adoption of more “therapeutic” and “problem solving” practices by mainstream judges in civil and criminal courts in a number of jurisdictions, most notably in the United States and Australia. Currently, a judge who sets out to exercise a significant therapeutic function is quite likely to be doing so in a specialist court or jurisdiction, outside the mainstream court system, and, arguably, from outside the adversarial paradigm itself. To some extent, his work is tolerated but marginalized. But do therapeutic and problem solving functions have the potential to define, rather than complement, the role of judicial officers? The basic question addressed in this paper is, therefore, whether the judicial role could evolve to be not just less adversarial, but fundamentally non-adversarial. In other words, could we see--or are we seeing--a paradigm shift not just in the colloquial, casual sense of the word, but in the strong, worldview changing sense meant by Thomas Kuhn?

Determinants of driver vs. second row occupant posture modelling

Digital human modeling (DHM), as a convenient and cost-effective tool, is increasingly incorporated into product and workplace design. In product design, it is predominantly used for the development of driver-vehicle systems. Most digital human modeling software tools, such as JACK, RAMSIS and DELMIA HUMANBUILDER provide functions to predict posture and positions for drivers with selected anthropometry according to SAE (Society of Automotive Engineers) Recommended Practices and other ergonomics guidelines. However, few studies have presented 2nd row passenger postural information, and digital human modeling of these passenger postures cannot be performed directly using the existing driver posture prediction functions. In this paper, the significant studies related to occupant posture and modeling were reviewed and a framework of determinants of driver vs. 2nd row occupant posture modeling was extracted. The determinants which are regarded as input factors for posture modeling include target population anthropometry, vehicle package geometry and seat design variables as well as task definitions. The differences between determinants of driver and 2nd row occupant posture models are significant, as driver posture modeling is primarily based on the position of the foot on the accelerator pedal (accelerator actuation point AAP, accelerator heel point AHP) and the hands on the steering wheel (steering wheel centre point A-Point). The objectives of this paper are aimed to investigate those differences between driver and passenger posture, and to supplement the existing parametric model for occupant posture prediction. With the guide of the framework, the associated input parameters of occupant digital human models of both driver and second row occupant will be identified. Beyond the existing occupant posture models, for example a driver posture model could be modified to predict second row occupant posture, by adjusting the associated input parameters introduced in this paper. This study combines results from a literature review and the theoretical modeling stage of a second row passenger posture prediction model project.

A Bayesian‐Markov process for reliability prediction

Accurate reliability prediction for large-scale, long lived engineering is a crucial foundation for effective asset risk management and optimal maintenance decision making. However, a lack of failure data for assets that fail infrequently, and changing operational conditions over long periods of time, make accurate reliability prediction for such assets very challenging. To address this issue, we present a Bayesian-Marko best approach to reliability prediction using prior knowledge and condition monitoring data. In this approach, the Bayesian theory is used to incorporate prior information about failure probabilities and current information about asset health to make statistical inferences, while Markov chains are used to update and predict the health of assets based on condition monitoring data. The prior information can be supplied by domain experts, extracted from previous comparable cases or derived from basic engineering principles. Our approach differs from existing hybrid Bayesian models which are normally used to update the parameter estimation of a given distribution such as the Weibull-Bayesian distribution or the transition probabilities of a Markov chain. Instead, our new approach can be used to update predictions of failure probabilities when failure data are sparse or nonexistent, as is often the case for large-scale long-lived engineering assets.

Genesis and role of standards : theoretical foundations and socio-economical model for the construction and use of standards

A key issue in the economic development and performance of organizations is the existence of standards. Their definition and control are sources of power and it is important to understand their concept, as it gives standards their direction and their legitimacy, and to explore how they are represented and applied. The difficulties posed by classical micro-economics in establishing a theory of standardization that is compatible with its fundamental axiomatic are acknowledged. We propose to reconsider the problem by taking the opposite perspective in questioning its theoretical base and by reformulating assumptions about the independent and autonomous decisions taken by actors. The Theory of Conventions will offer us a theoretical framework and tools enabling us to understand the systemic dimension and dynamic structure of standards. These will be seen as a special case of conventions. This work aims to provide a sound basis and promote a better consciousness in the development of global project management standards. It aims also to emphasize that social construction is not a matter of copyright but a matter of open minds, collective cognitive process and freedom for the common wealth.

Genesis and role of standards : theoretical foundations and socio-economical model for the construction and use of standards

A key issue for the economic development and for performance of organizations is the existence of standards. As their definitions and control are source of power, it seems to be important to understand the concept and to wonder about the representations authorized by the concept which give their direction and their legitimacy. The difficulties of classical microeconomics of establishing a theory of standardisation compatible with its fundamental axiomatic are underlined. We propose to reconsider the problem by carrying out the opposite way: to question the theoretical base, by reformulating assumptions on the autonomy of the choice of the actors. The theory of conventions will offer us both a theoretical framework and tools, enabling us to understand the systemic dimension and dynamic structure of standards seen as special case of conventions. This work aims thus to provide a sound basis and promote a better consciousness in the development of global project management standards, aiming also to underline that social construction is not a matter of copyright but a matter of open minds, collective cognitive process and freedom for the common wealth.

Work motivation as a determinant of organizational and professional commitment in case of temporary organizations : theoretical perspectives

The purpose of this paper is to present a theoretical framework to investigate the relationship between work motivation, organizational commitment, and professional commitment in temporary organizations. Through a review of theory, we contend that work motivation has two major patterns- internal motivation (that includes intrinsic, need-based, and self-deterministic theories), and external motivation (that includes cognitive or process-based theories of motivation) through which it has been investigated. We also subsume the nature of employee commitment to be of three types- affective, continuance, and normative. This commitment may either be towards organization or profession. A literature review reveals that the characteristics of the temporary organization - specifically tenure, and task - regulate the relationship between work motivation, and organizational commitment, and professional commitment. Relevant propositions are presented.

Prediction of the wash-off of traffic related semi- and non-volatile organic compounds from urban roads under climate change influenced rainfall characteristics

Traffic generated semi and non volatile organic compounds (SVOCs and NVOCs) pose a serious threat to human and ecosystem health when washed off into receiving water bodies by stormwater. Climate change influenced rainfall characteristics makes the estimation of these pollutants in stormwater quite complex. The research study discussed in the paper developed a prediction framework for such pollutants under the dynamic influence of climate change on rainfall characteristics. It was established through principal component analysis (PCA) that the intensity and durations of low to moderate rain events induced by climate change mainly affect the wash-off of SVOCs and NVOCs from urban roads. The study outcomes were able to overcome the limitations of stringent laboratory preparation of calibration matrices by extracting uncorrelated underlying factors in the data matrices through systematic application of PCA and factor analysis (FA). Based on the initial findings from PCA and FA, the framework incorporated orthogonal rotatable central composite experimental design to set up calibration matrices and partial least square regression to identify significant variables in predicting the target SVOCs and NVOCs in four particulate fractions ranging from >300-1 μm and one dissolved fraction of <1 μm. For the particulate fractions range >300-1 μm, similar distributions of predicted and observed concentrations of the target compounds from minimum to 75th percentile were achieved. The inter-event coefficient of variations for particulate fractions of >300-1 μm were 5% to 25%. The limited solubility of the target compounds in stormwater restricted the predictive capacity of the proposed method for the dissolved fraction of <1 μm.

Benefits and issues of urban network travel time prediction

This paper presents the benefits and issues related to travel time prediction on urban network. Travel time information quantifies congestion and is perhaps the most important network performance measure. Travel time prediction has been an active area of research for the last five decades. The activities related to ITS have increased the attention of researchers for better and accurate real-time prediction of travel time. Majority of the literature on travel time prediction is applicable to freeways where, under non-incident conditions, traffic flow is not affected by external factors such as traffic control signals and opposing traffic flows. On urban environment the problem is more complicated due to conflicting areas (intersections), mid-link sources and sinks etc. and needs to be addressed.