Evaluation of a financial distress model for Department of Defense hardware contractors

dc.contributor.authorCollins, Richard B.en
dc.contributor.committeechairMeiselman, David I.en
dc.contributor.committeememberPorter, William R.en
dc.contributor.committeememberWentzler, Nancy N.en
dc.contributor.departmentEconomicsen
dc.date.accessioned2014-03-14T21:47:16Zen
dc.date.adate2009-10-10en
dc.date.available2014-03-14T21:47:16Zen
dc.date.issued1992-05-15en
dc.date.rdate2009-10-10en
dc.date.sdate2009-10-10en
dc.description.abstractThis thesis investigates the accuracy of a model that the Department of the Navy uses to predict the financial health of major defense hardware contractors. The inputs to this model are six financial ratios derived from a firm’s income sheet and balance statement. The output of this model is a single Z-score that indicates the health of a firm. Depending on the score, a firm’s financial standing is classified as healthy, distressed, or uncertain. The model is tested using a database compiled for this thesis that includes financial information for a total of 72 defense and non-defense firms. The test database is unique relative to the underlying model database; it reflects a more recent timeframe and a greater number of firms, none of which were used to develop the model. Model accuracy was computed by measuring how often the model correctly classified a bankrupt firm as distressed and a nonbankrupt firm as healthy. Then, model accuracy was evaluated by comparing these test results (i.e., percent correctly classified) to results published by the model’s developers. This comparison produced mixed results. In light of this fact, the thesis concludes that the model should be improved and recommends a course of action.en
dc.description.degreeMaster of Artsen
dc.format.extentvii, 85 leavesen
dc.format.mediumBTDen
dc.format.mimetypeapplication/pdfen
dc.identifier.otheretd-10102009-020236en
dc.identifier.sourceurlhttp://scholar.lib.vt.edu/theses/available/etd-10102009-020236/en
dc.identifier.urihttp://hdl.handle.net/10919/45128en
dc.language.isoenen
dc.publisherVirginia Techen
dc.relation.haspartLD5655.V855_1992.C655.pdfen
dc.relation.isformatofOCLC# 26557297en
dc.rightsIn Copyrighten
dc.rights.urihttp://rightsstatements.org/vocab/InC/1.0/en
dc.subject.lccLD5655.V855 1992.C655en
dc.subject.lcshBankruptcy -- Forecasting -- Mathematical modelsen
dc.subject.lcshDefense contracts -- United States -- Mathematical modelsen
dc.titleEvaluation of a financial distress model for Department of Defense hardware contractorsen
dc.typeThesisen
dc.type.dcmitypeTexten
thesis.degree.disciplineEconomicsen
thesis.degree.grantorVirginia Polytechnic Institute and State Universityen
thesis.degree.levelmastersen
thesis.degree.nameMaster of Artsen

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