Finance and Financial Management Commons^™

An Evaluation Of Decision Tree And Survival Analysis Techniques For Business Failure Prediction, Adrian Gepp

Adrian Gepp

Accurate business failure prediction models would be extremely valuable to many industry sectors, particularly in financial investment and lending. The potential value of such models has been recently emphasised by the extremely costly failure of high profile businesses in both Australia and overseas, such as HIH (Australia) and Enron (USA). Consequently, there has been a significant increase in interest in business failure prediction, from both industry and academia. Statistical models attempt to predict the failure or success of a business based on publicly available information about that business (or its industry and the overall economy), such as accounting ratios from …