Zastosowanie modelu probitowego oraz uciętego liniowego modelu prawdopodobieństwa do analizy kondycji ekonomiczno-finansowej wybranych przedsiębiorstw z indeksu mWIG40
The Application of Probit Model and Cut Linear Probability Model To the Analysis of Economic and Financial Standing of Enterprises Selected From MWIG40 Index

Summary/Abstract: Purpose – The purpose of this article is to evaluate the economic and financial standing of 10 joint stock companies included into mWIG40 index with the use of methods that serve to forecast threats of bankruptcy of enterprises. Design/Methodology/approach – In the article the following research methods are used: analysis of literature, financial ratios analysis, statistics methods used to predict the risk of bankruptcy – probit model and cut linear probability model LMP. Findings – To analyse the companies that were randomly chosen from mWIG40 index, we used two models: probit model and cut linear probability model (LMP). Both models used in this paper gave similar results. The differences in the classification of companies stem from different sets of financial ratios/indicators that are the exogenous variable in the above mentioned models. Cut LMP is more versatile than the probit model because it includes a wider scope of financial ratios and therefore it describes economic activities of a company more precisely. The conducted analysis allowed identifying and ranking of companies with the best and the worst financial standing within the examined group of enterprises. Originality/value – The paper presents implementation of probit model and cut linear probability model LMP in evaluating the company's condition. The results obtained through the application of the models using sets of indicators from different scopes of ratio analysis as explanatory variables were compared. In the paper author’s models of Ewa Zdunek-Rosy, who is also a co-author of the article, were used. The results obtained should be interesting mainly for people managing companies as well as for entities for which the evaluation of the economic and financial situation is a starting point of taking various decisions, e.g for banks, audit firms or government offices.

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