Bankruptcy Prediction of Financially Distressed Companies using Independent Component Analysis and Fuzzy Support Vector Machines
Journal Title: International Journal of Research in Computer and Communication Technology - Year 2014, Vol 3, Issue 8
Abstract
The aim of research is to model the dependency of enterprises on their financial ratios for predicting bankruptcy using artificial neural networks combined with fuzzy logic. A sample of companies which are financially distressed but not yet bankrupt is considered for conducting experiments. The data extracted from financial reports of financially distressed companies for past five year forms the basis for carrying out prediction. Independent Component Analysis has been applied on the input dataset comprising of financial ratios to choose the most significant ratios to be considered as input to the neuro-fuzzy network. A data set of size 1030 consisting of five variables was used for training and of size 350 was used for testing the network’s performance. In this way the model predicts the bankruptcy status of the enterprises with minimal training errors. A linguistic diagnosis of failure or financial problems of the enterprises is done using the fuzzy rule-base for support vector machines. The proposed model can be utilized by stakeholders of a financial distressed company for determining its future status. It can also be used by managers of the enterprises to take preventive measures to deal with financial crises.
Authors and Affiliations
Nidhi Arora, JatinderKumar R. Saini
Keywords
Related Articles
- EP ID EP27986
- DOI -
- Views 258
- Downloads 0
Effective R-cube Algorithm for Deriving Relevant Information on the Web
The analysis of user search goals can be very useful in improving search engine relevance and user experience. A novel approach to infer user search goals by examines search engine query logs. A framework to determin...
Fuzzy Logic Based Contrast Image Enhancement Technique
Image Enhancement is one of the most important and difficult techniques in image research. Many images like satellite images, medical images, aerial images and even real life photographs may suffer from poor contrast...
LOAD Balancer Strategy Based On Cloud Computing
At present cloud computing is one of the utmost platform which delivers storage of data in very lower cost and accessible for all time over the internet. But it has more serious issue like security, load management a...
A Freight Stabilization Model Based On Cloud Segregating For the Shared Cloud
Cloud computing having tremendous growth on recent years but it is not segregation on shared clouds. Clouds are most provably used for huge amount of data storage and communication. "The cloud", also focuses on incre...
Novel De-duplication Technique for Supporting Differential Privileges Check in H-Cloud
Clients are benefited storing their data in Cloud instead of local data management. But one critical challenge of cloud storage is management of huge volumes of data and lack of privacy and security which maximizes t...