Main Article Content
Corporate bankruptcy has enormous economic ramifications, particularly for investors and creditors of publicly listed companies (PLC). Prior to a corporate collapse, a company's financial status is frequently in jeopardy, and its performance either affirms progress or predicts failure. As a result, management is interested in a technique of determining a company's financial distress. Financial accounting analyses were performed to determine the solvency, liquidity, profitability, and gearing capacity of 136 firms, with 680 economic entries, before CoVid-19 Outbreak. To scrutinise financial distress, the Altman Z-scores and financial zone of discriminations were generated through GB bankruptcy, and PLC bankruptcy model. The link between declining profitability, economic failure, and financial insolvency as indicators of financial distress was examined through panel regression with random factors. Prior to the COVID-19 outbreak, there were no signs of declining profitability, economic collapse, or financial insolvency in the Philippines, according to the findings of the study. Individual components of financial distress and the overall z-score have no statistically meaningful association with financial performance and position markers. As a result, the solvency ratio has little predictive value in forecasting financial distress. The fact that a company has a higher solvency ratio does not also imply that it is less likely to go bankrupt. The findings go counter to classic accounting perspectives and pure managerial research that claim the solvency ratio is always a reliable predictor of financial distress. Finally, the paper examined the financial health of firms and untangled the knots of financial distress.
JATI PUBLICATION ETHICS & PUBLICATION MALPRACTICE STATEMENT:
These guidelines are fully consistent with the COPE Principles of Transparency and Best Practice Guidelines and the COPE Code of Conduct (https://publicationethics.org).
We encourage the best standards of publication ethics and take all possible of principles of transparency and measures against publication malpractices. The Department of Southeast Asian Studies as the publisher plays its roles of guardianship over all processes of publishing seriously and we perform our ethical and other tasks.
- General duties and responsibilities of editors
Editors should be accountable for everything published in their journals. This means the editors should strive to meet the needs of readers and authors; constantly improve their journal; have processes in place to assure the quality of the material they publish; champion freedom of expression; maintain the integrity of the academic record; preclude business needs from compromising intellectual and ethical standards; and always be willing to publish corrections, clarifications, retractions and apologies when needed. In addition to these general duties, the editors accept the obligation to apply best will and practice to cope with the following responsibilities:
- Editorial Board
Editorial board will be generated from recognized experts in the field. The editor will provide full names and affiliations of the members as well as updated contact information for the editorial office on the journal webpage.
- Duties of Reviewers
Contribution to Editorial Decisions
Peer review assists the editor in making editorial decisions and through the editorial communications with the author may also assist the author in improving the paper.
- Duties of Authors
Authors should follow the format of reporting the original research with accurate data gathered. The author should include sufficient detail and references to allow others to replicate the work. It is unacceptable if the author performs malpractices in the paper.
- Originality and Plagiarism
The authors should ensure that they have produced original papers, and must appropriately cite or quoted if the authors have used the work and words of others.
- Concurrent Publication
It is an ethical and acceptable for an author to submit or publish same research or manuscripts in more than one journal or primary publication.
- Acknowledging the Sources
Authors should cite properly publications that have been influential in determining the nature of the reported work.
- Paper authorship
Those who have made a significant contribution to the paper should be named as an author and co-authors. Those who have participated in the aspects of the research, they should be they should be listed as contributors. All co-authors should have seen and approved the final version of the paper and have agreed to its submission for publication.
- Announcement and Conflicts of Interest
All authors should include the financier or grant giver if the manuscript or research financed by the research grant or any financial support body.
- Errors in published works
The author is responsible for communicating and co-operating with the editor to retract or correct the paper when a significant error or inaccuracy in his/her published work.
- Publication decisions
The editor should be responsible for deciding which of the articles submitted to the journal should be published. The validation of the work in question and its importance to researchers and readers must always drive such decisions. The editor may be guided by the policies of the journal's editorial board and constrained by such legal requirements, copyright infringement, and plagiarism. The editor may confer with other editors or reviewers in making this decision.
- Peer review process
All journal's content (articles) are subjected to a double-blind, peer-review process. Articles are first reviewed by editors and may be rejected because it is not dealing with the subject matter. Articles that are found suitable for review are then sent to two experts are unknown to each other in the field of the paper.
Reviewers are asked to classify the paper as publishable, publishable with amendments and improvements, or rejected. Reviewer's evaluations normally include the recommendation of what to do with the paper. Reviewer's comments are then seen by the author.
Editors should be ready to justify any important points from the described process. Editors should not reverse decisions on publication. Editors should publish guidance to both authors and reviewers on everything that is expected of them. This guidance should be regularly updated and will refer or link this code.
- Fair play
The editor should evaluate manuscripts for their intellectual content without regard to race, gender, sexual orientation, religious belief, ethnic origin, citizenship, or political philosophy of the authors. Editors' decision to accept or reject a paper for publication should be based only on the paper's importance, originality and clarity, and the study's relevance to the aim of the journal.
- Digital Archiving
The editor will ensure digital preservation of access to the journal content by the University of Malaya Journal depository section at http://jati-dseas.um.edu.my and MyJournal at http://www.myjurnal.my/public/browse-journal-view.php?id=39
Editor and any editorial staff must keep confidential of all information about a submitted and review process of the manuscript to anyone except the corresponding author, reviewers, potential reviewers, other editorial advisers, and the publisher.
- Publication and Submission fee
Authors are freed from fees or charges for manuscript processing. Authors pay neither submission nor publication fee beyond eventual conference registration fee (in case conference paper accepted for publication).
- Open Access Policy
The journal is freely available online. Authors are required to agree with this open access policy which enables unrestricted access and reuse of all published articles. The articles are published under the Creative Commons copyright license policy CC-BY.
- Reporting standards
Authors of papers should present an accurate account of the work performed as well as an objective discussion of its significance. Underlying data should be represented accurately in the paper. A paper should contain sufficient detail and references to permit others to replicate the work. Fraudulent or knowingly inaccurate statements constitute unethical behavior and are unacceptable. Review and professional publication articles should also be accurate and objective, and editorial 'opinion' works should be clearly identified as such.
- Originality and Plagiarism
The authors should ensure that they have written entirely original works and if the authors have used the work and words of others that this has been appropriately cited or quoted.
ADBI. (2019). Corporate Governance, Firm Profitability, and Share Valuation in the Philippines. Creative Commons Attribution 3.0 IGO license (CC BY 3.0 IGO). Retrieved from https://www.adb.org/sites/default/files/publication/549336/corporate-governance-firm-profitabilty-philippines.pdf
Aziz, M. A., & Dar, H. A. (2006). Predicting corporate bankruptcy: where we stand?. Corporate Governance: The international journal of business in society.
Aduana, N. L. (2015). Financial Statements Preparation, Presentation, Analysis, and Interpretation. Quezon City: C & E Publishing, Inc. Retrieved from https://www.carousell.ph/p/financial-statements-preparation-presentation-analysis-and-interpretation-by-nick-aduana-177301151/
Altman, E. I. (1968). Financial Ratios, Discriminant Analysis and the Prediction of Corporate Bankruptcy. The Journal of Finance, 23(4), 589-609. https://www.jstor.org/stable/2978933
Brîndescu-Olariu, D. (2014). The potential of the equity working capital in the prediction of bankruptcy. Management intercultural, (31), 25-32.
Brîndescu-Olariu, D. (2015). The Potential of the Debt ratio in the Prediction of Corporate Bankruptcy. Journal of Public Administration, Finance and Law, (special), 37-45.
Brîndescu-Olariu, D. (2016a). Solvency Ratio as a Tool for Bankruptcy Prediction. Paper submitted for publication. Retrieved from http://ecoforumjournal.ro/index.php/eco/article/viewFile/418/265
Brîndescu-Olariu, D. (2016b). Bankruptcy Prediction Based on the Debt Ratio. Theoretical and Applied Economics, XXIII(2), 145-156. Retrieved from https://econpapers.repec.org/article/agrjournl/v_3axxiii_3ay_3a2016_3ai_3a2(607)_3ap_3a145-156.htm
Brigham, E. F., & Daves, P. R. (2007). Intermediate Financial Management. Mason: Thomson Higher Education. Retrieved from https://bandi.feb.uns.ac.id/wp-content/uploads/2018/09/intermediate-brigham-full.pdf
Chung, K. C., Tan, S. S., & Holdsworth, D. K. (2008). Insolvency Prediction Model Using Multivariate. International Journal of Business and Management.
Chouhan, V., Chandra, B., & Goswami, S. (2014). Predicting Financial Stability of Select BSE Companies Revisiting Altman Z Score. International Letters of Social and Humanistic Sciences, 15(2), 92-105.
Claessens, S., Djankov, S., & Klapper, L. (2003). Resolution of Corporate Distress in East Asia. Journal of Empirical Finance, 10(1-2), 199-216. Retrieved from https://www.researchgate.net/publication/222567155_Resolution_of_Corporate_Distress_in_East_Asia
Enyi, E. P. (2008). A Comparative Analysis of the Effectiveness of Three Solvency Management Models. Retrieved from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1138357
Ferrer, R. C., & Banderlipe II, M. R. S. (2012). The Influence of Corporate Board Characteristics on Firm Performance of Publicly Listed Property Companies in the Philippines. Academy of Accounting & Financial Studies Journal, 16(4), 123-142. Retrieved from https://www.researchgate.net/profile/Mcrey-Banderlipe-Ii/publication/288095245_The_influence_of_corporate_board_characteristics_on_firm_performance_of_publicly_listed_property_companies_in_the_philippines/links/56c4270c08aee3dcd416eaff/The-influence-of-corporate-board-characteristics-on-firm-performance-of-publicly-listed-property-companies-in-the-philippines.pdf
Gao, P., Parsons, C. A., & Shen, J. (2018). Global Relation Between Financial Distress and Equity Returns. The Review of Financial Studies, 31(1), 239-277. Retrieved from https://academic.oup.com/rfs/article-abstract/31/1/239/3867963
Greene, W. (2002). Econometrics Analysis. New York: Prentice Hall.
Helfert, E. (2015). Financial Analysis: Tools and Techniques - A Guide for Managers. New York: McGraw-Hill. Retrieved from https://www.academia.edu/2124620/Financial_analysis_tools_and_techniques_a_guide_for_managers
Klapper, L., Claessens, S., & Djankov, S. (1999). Resolution of Corporate Distress: Evidence from East Asia's Financial Crisis. Washington, DC: World Bank. Retrieved from https://elibrary.worldbank.org/doi/abs/10.1596/1813-9450-2133
Lim, C. H. (1998). Managing Corporate Distress in the Philippines: Some Policy Recommendations. IMF Working Paper No. 98/138. Retrieved from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=882700
Lizares, R. M., & Bautista, C. C. (2021). Corporate Financial Distress: The Case of Publicly Listed Firms in an Emerging Market Economy. Journal of International Financial Management & Accounting, 32(1), 5-20. Retrieved from https://onlinelibrary.wiley.com/doi/abs/10.1111/jifm.12122
Mahama, M. (2015). Assessing the State of Financial Distress in Listed Companies in Ghana: Signs, Sources, Detection and Elimination–A Test of Altman’s Z-Score. European Journal of Business and Management, 7(3), 1-10. Retrieved from https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.679.5915&rep=rep1&type=pdf
McReynald, S. (2013). Board Characteristics and Its Impact on Share Prices of Publicly Listed Holding Companies in the Philippines. Retrieved from https://www.researchgate.net/profile/Mcrey-Banderlipe-Ii/publication/294814145_Board_Characteristics_and_its_Impact_on_Share_Prices_of_Publicly-Listed_Holding_Companies_in_the_Philippines/links/56c426af08ae60234251249b/Board-Characteristics-and-its-Impact-on-Share-Prices-of-Publicly-Listed-Holding-Companies-in-the-Philippines.pdf
Outecheva, N. (2007). Corporate Financial Distress: An Empirical Analysis of Distress Risk (Doctoral thesis), Graduate School of Business Administration, Economics, Law and Social Sciences, University of St. Gallen, St. Gallen, Switzerland. Retrieved from https://www.e-helvetica.nb.admin.ch/api/download/urn%3Anbn%3Ach%3Abel-130003%3Adis3430.pdf
Ohlson, J. A. (1980). Financial Ratios and the Probabilistic Prediction of Bankruptcy. Journal of Accounting Research, 18, 109–131. Retrieved from https://www.jstor.org/stable/2490395
Pauli, J., & Wolf, M. (2017). Hanjin Shipping: Slow-Steaming into Bankruptcy: Causes and Effects (Master’s thesis), School of Business, Economics and Law, University of Gothenburg, Gothenburg, Sweden. Retrieved from https://gupea.ub.gu.se/handle/2077/52799
Russ, R. W., Peffley, W. W., & Greenfield, A. C. (2004, January 6). The Altman Z-Score Revisited. Retrieved from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=484923
Torres-Reyna, O. (2007). Panel Data Analysis - Fixed and Random Effects using Stata (v. 4.2). Princeton: Data and Statistical Services, Priceton University.
Tuvadaratragool, S. (2013). The Role of Financial Ratios in Signalling Financial Distress: Evidence from Thai Listed Companies (Doctoral dissertation), Southern Cross University, East Lismore, Australia. Retrieved from https://researchportal.scu.edu.au/esploro/outputs/doctoral/The-role-of-financial-ratios-in-signalling-financial-distress--evidence-from-Thai-listed-companies/991012821520902368
Wang, D., & Zhou, F. (2016). The Application of Financial Analysis in Business Management. Open Journal of Business and Management, 4, 471-475. Retrieved from https://www.scirp.org/journal/paperinformation.aspx?paperid=68268
Whitaker, R. (1999). The Early Stages of Financial Distress. Journal of Economics and Finance, 23(2), 12-132. Retrieved from https://link.springer.com/article/10.1007/BF02745946