Crisis Alarm System with Information Disclosure Transparency

• Main Authors: Tsai,Chia-Fang, 蔡佳芳
• Other Authors: Wen,Yue-Fang Ph. D.
• Format: Others
• Language: zh-TW
• Published: 2008
• Online Access: http://ndltd.ncl.edu.tw/handle/09133788252550553821

碩士 === 國立宜蘭大學 === 應用經濟學系碩士班 === 96 === In recent years, some of Taiwanese listed companies occurred financial crises or corporate governance problems that caused many stock shock events. In order to avoid the money loss of investors and creditors, the establishment of an alarm system is essentially needed that could prevent and lower the damages on investors and creditors in advance. With various numerical methods, traditional alarm systems merely emphasize on financial ratios and judge which model is the best. However, the research limit of most studies is that when financial reports are inaccurate, thus the function of the alarm system is not working. Therefore, it is insufficient to predict company crises merely by financial ratios. To increase the credibility of an alarm system, other variables should be included in the model. As many countries emphasize the importance of corporate governance more and more, Organization for Economic Cooperation and Development(OECD)provided guidance of six principles in 2004 again, for stock-exchanges, investors, companies and others that have a role in the process of developing good corporate governance. There are few studies that included corporate governance variables in alarm systems, but one of the important corporate governance principles - information disclosure transparency is not considered. Because the information disclosure transparency is the result of the good corporate governance, the final purpose of the information disclosure transparency lies in the trust of the investors that increases the firm value. Therefore, the importance of the information disclosure transparency cannot be ignored. In addition, macro economy also influences company operations, but the alarm systems of previous studies did not consider this factor either. Besides the traditional finance ratios, this research also considers the corporate governance variables including the information disclosure transparency, and macro economic indices. By using the logit regression, a domestic alarm system of listed companies is established. In addition, due to the industrial characteristics that may influence the predicting accuracy of an alarm model, this research considers the control variables as well as industrial factor that make this research unique to other researches so that a more complete alarm system can be constructed. Based on the ratio of one to two, 55 companies are selected as sample of financial crisis and 110 companies are selected as matching sample during the period of 2004-2006, with a total sample of 165. This research uses accounting, corporate governance and macroeconomic variables concurrently to develop an alarm system in order to ehance the predicting accuracy of company crisis.