Assessing Bankruptcy of Indian Listed Firms Using Bankruptcy Models, Decision Tree and Neural Network

Abstract

Bankruptcy is that state of insolvency in which a company or an organization cannot discharge their financial obligation or are unable to meet the payments to their creditors. As the company cannot keep up with their debts, they cannot continue with their activities. The prediction of this stage of the company is important to the various stakeholders of the company such as the investors, the creditors, the regulators and the lenders. This study discusses the assessment of bankruptcy using traditional bankruptcy models along with the new methods like Decision Tree Framework, Neural Network Framework to predict bankruptcy using the latest advancements in technology and challenge the traditional Altman Z Model.