MANUFACTURING COMPANY BANKRUPTCY PREDICTION IN INDONESIA WITH ALTMAN Z-SCORE MODEL
Abstract: Model Altman is one
of the models used to predict financial distress. Some of the results of
research that conducted in Indonesia showed that Altman model is completely
accurate in predicting financial distress but the other found the opposite
results. This inconsistency indicates the need to adapt the model by checking
whether variables affect Altman model in financial distress companies in
Indonesia and the adjustment coefficients Altman to be able to better predict
about financial distress. The results showed that the partial test working
capital/total assets, retained earnings to total assets, and earning before
interest and tax to total assets were able to classify the company’s financial
distress. However, the model that formed by five variables were able to
classify financial distress well with an accuracy of 87.8%.
Keywords: altman z-score,
financial distress, bankruptcy, prediction
Penulis: Nur Hasbullah
Matturungan, Budi Purwanto, Abdul Kohar Irwanto
Kode Jurnal: jpmanajemendd170280
