The impact of size and age of the company on assessing financial risk

Textiles and tourism sectors are two important sectors in Portuguese economy. Its high exposure to both internal and international economy volatility transform the companies operating in these economic sectors especially vulnerable to recent economic crises in Portugal and European Union. The objective of this paper is to evaluate and understand the impact of size and age on the financial health of textile and tourism companies, measured by economic indices. An empirical based model is proposed. Its implications are derived and tested on a sample of 4061 Portuguese companies from textile and tourism sector, during the period 2005-2009. The results conclude that age has a stronger impact on the risk of failure than size. Whereas the effect of age is generally positive regarding the financial health of the company, the effect of size is less clear and depends on the age of the company.

Consorciação taro e crotalária manejada com corte rente ao solo e poda na altura do dossel

A associação de culturas com leguminosas de adubação verde visa à manutenção ou melhorias da fertilidade do solo. Com o objetivo de avaliar a consorciação do taro 'Japonês' com crotalária, foram conduzidos dois experimentos, em Viçosa, MG, no período de 10/09/2010 a 10/06/2011. No Experimento I, as plantas de crotalária foram cortadas rente ao solo e, no Experimento II, podadas à altura do dossel do taro; em ambos, os tratamentos consistiram em seis épocas de corte ou poda da crotalária (75; 105; 135; 165; 195 e 225 dias após a semeadura da crotalária - DAS), mais a monocultura do taro. As partes cortadas ou podadas foram depositadas sobre o solo e determinaram-se as quantidades de fitomassa e de nutrientes da crotalária. Na colheita do taro, avaliaram-se a produção de classes de rizomas e as alterações químicas do solo. Os cortes realizados após 105 DAS proporcionaram menor produção em massa de rizomas-mães e, em número, por planta, de rizomas-filhos grandes e comerciais, em comparação com os do controle. Comportamento semelhante foi observado para experimento com poda à altura do dossel. Os cortes ou podas realizados aos 135 e 165 DAS foram os que apresentaram maiores quantidades de fitomassas fresca e seca de crotalária, de carbono orgânico e de nutrientes. Aos 165 DAS, o aporte de N ao solo pela crotalária cortada chegou a 308 Kg ha-1 e, pela crotalária podada, a 202 kg ha-1. A associação entre crotalária e taro é viável, sendo indicada a manutenção da consorciação até aos 105 DAS da crotalária.

Financial Risk Analysis of Portuguese Textile and Tourism Companies

Textile and tourism sectors are two important industries in the Portuguese economy. However, its high exposure to both internal and international economic volatility make the companies operating in these economic sectors particularly vulnerable to economic crises, such as the ones which have been impacting Portugal and the European Union. The objective of this paper is to evaluate and understand the impact of size and age on the financial health of textile and tourism companies, measured by economic indices. An empirical based model is proposed. Its implications are derived and tested on a sample of 4061 Portuguese companies from textile and tourism sectors, during the period 2005-2009. The findings suggest that age has a major impact on the risk of failure, rather than size. Whereas the effect of age is generally positive regarding the financial health of the company, the effect of size is less clear and ultimately depends on the age of the company.

Comparative Analysis between Statistical and Artificial Intelligence Models in Business Failure Prediction

A growing number of predicting corporate failure models has emerged since 60s. Economic and social consequences of business failure can be dramatic, thus it is not surprise that the issue has been of growing interest in academic research as well as in business context. The main purpose of this study is to compare the predictive ability of five developed models based on three statistical techniques (Discriminant Analysis, Logit and Probit) and two models based on Artificial Intelligence (Neural Networks and Rough Sets). The five models were employed to a dataset of 420 non-bankrupt firms and 125 bankrupt firms belonging to the textile and clothing industry, over the period 2003–09. Results show that all the models performed well, with an overall correct classification level higher than 90%, and a type II error always less than 2%. The type I error increases as we move away from the year prior to failure. Our models contribute to the discussion of corporate financial distress causes. Moreover it can be used to assist decisions of creditors, investors and auditors. Additionally, this research can be of great contribution to devisers of national economic policies that aim to reduce industrial unemployment.

Financial Risk Analysis of Portuguese Textile and Tourism Companies

Textile and tourism sectors are two important industries in the Portuguese economy. However, its high exposure to both internal and international economic volatility make the companies operating in these economic sectors particularly vulnerable to economic crises, such as the ones which have been impacting Portugal and the European Union. The objective of this paper is to evaluate and understand the impact of size and age on the financial health of textile and tourism companies, measured by economic indices. An empirical based model is proposed. Its implications are derived and tested on a sample of 4061 Portuguese companies from textile and tourism sectors, during the period 2005-2009. The findings suggest that age has a major impact on the risk of failure, rather than size. Whereas the effect of age is generally positive regarding the financial health of the company, the effect of size is less clear and ultimately depends on the age of the company.

The impact of size and age of the company on assessing financial risk.

Textiles and tourism sectors are two important sectors in Portuguese economy. Its high exposure to both internal and international economy volatility transform the companies operating in these economic sectors especially vulnerable to recent economic crises in Portugal and European Union. The objective of this paper is to evaluate and understand the impact of size and age on the financial health of textile and tourism companies, measured by economic indices. An empirical based model is proposed. Its implications are derived and tested on a sample of 4061 Portuguese companies from textile and tourism sector, during the period 2005-2009. The results conclude that age has a stronger impact on the risk of failure than size. Whereas the effect of age is generally positive regarding the financial health of the company, the effect of size is less clear and depends on the age of the company.