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Altman Z-score, the Glossary

Excel spreadsheet that uses Altman Z-score to predict the probability that a firm will go into bankruptcy within two years The Z-score formula for predicting bankruptcy was published in 1968 by Edward I. Altman, who was, at the time, an Assistant Professor of Finance at New York University.^[1]

27 relations: American International Group, Bankruptcy, Bear Stearns, Beneish M-score, Chapter 7, Title 11, United States Code, Crore, Edward Altman, Financial distress, Ford Motor Company, Journal of International Financial Management and Accounting, Lehman Brothers, Linear combination, Linear discriminant analysis, MF Global, New York University, New York University Stern School of Business, Ohlson O-score, Piotroski F-score, Probability, Ronald Fisher, Standard score, Student's t-test, Washington Mutual, Wiley (publisher), William H. Beaver, Z-factor, Z-test.
1968 introductions
Credit scoring

American International Group

American International Group, Inc. (AIG) is an American multinational finance and insurance corporation with operations in more than 80 countries and jurisdictions.

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Bankruptcy

Bankruptcy is a legal process through which people or other entities who cannot repay debts to creditors may seek relief from some or all of their debts.

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Bear Stearns

The Bear Stearns Companies, Inc. was an American investment bank, securities trading, and brokerage firm that failed in 2008 during the 2007–2008 financial crisis and the Great Recession.

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Beneish M-score

The Beneish model is a statistical model that uses financial ratios calculated with accounting data of a specific company in order to check if it is likely (high probability) that the reported earnings of the company have been manipulated. Altman Z-score and Beneish M-score are financial ratios.

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Chapter 7, Title 11, United States Code

Chapter 7 of Title 11 U.S. Code is the bankruptcy code that governs the process of liquidation under the bankruptcy laws of the U.S. In contrast to bankruptcy under Chapter 11 and Chapter 13, which govern the process of reorganization of a debtor, Chapter 7 bankruptcy is the most common form of bankruptcy in the U.S.

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Crore

A crore (abbreviated cr) denotes ten million (10,000,000 or 107 in scientific notation) and is equal to 100 lakh in the Indian numbering system.

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Edward Altman

Edward I. Altman (born June 5, 1941) is a Professor of Finance, Emeritus, at New York University's Stern School of Business.

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Financial distress

Financial distress is a term in corporate finance used to indicate a condition when promises to creditors of a company are broken or honored with difficulty. Altman Z-score and Financial distress are bankruptcy.

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Ford Motor Company

Ford Motor Company (commonly known as Ford) is an American multinational automobile manufacturer headquartered in Dearborn, Michigan, United States.

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Journal of International Financial Management and Accounting

The Journal of International Financial Management & Accounting is a triannual peer-reviewed academic journal published by John Wiley & Sons.

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Lehman Brothers

Lehman Brothers Inc. was an American global financial services firm founded in 1850.

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Linear combination

In mathematics, a linear combination is an expression constructed from a set of terms by multiplying each term by a constant and adding the results (e.g. a linear combination of x and y would be any expression of the form ax + by, where a and b are constants).

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Linear discriminant analysis

Linear discriminant analysis (LDA), normal discriminant analysis (NDA), or discriminant function analysis is a generalization of Fisher's linear discriminant, a method used in statistics and other fields, to find a linear combination of features that characterizes or separates two or more classes of objects or events.

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MF Global

MF Global, formerly known as Man Financial, was a major global financial derivatives broker, or commodities brokerage firm that went bankrupt in 2011.

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New York University

New York University (NYU) is a private research university in New York City, United States.

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New York University Stern School of Business

The Leonard N. Stern School of Business (also NYU Stern, Stern School of Business, or simply Stern) is the business school of New York University, a private research university based in New York City.

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Ohlson O-score

The Ohlson O-score for predicting bankruptcy is a multi-factor financial formula postulated in 1980 by Dr. Altman Z-score and Ohlson O-score are bankruptcy, credit risk and financial ratios.

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Piotroski F-score

Piotroski F-score is a number between 0 and 9 which is used to assess strength of company's financial position. Altman Z-score and Piotroski F-score are credit scoring.

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Probability

Probability is the branch of mathematics concerning events and numerical descriptions of how likely they are to occur.

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Ronald Fisher

Sir Ronald Aylmer Fisher (17 February 1890 – 29 July 1962) was a British polymath who was active as a mathematician, statistician, biologist, geneticist, and academic.

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Standard score

In statistics, the standard score is the number of standard deviations by which the value of a raw score (i.e., an observed value or data point) is above or below the mean value of what is being observed or measured.

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Student's t-test

Student's t-test is a statistical test used to test whether the difference between the response of two groups is statistically significant or not.

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Washington Mutual

Washington Mutual, Inc. (often abbreviated to WaMu) was an American savings bank holding company based in Seattle.

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Wiley (publisher)

John Wiley & Sons, Inc., commonly known as Wiley, is an American multinational publishing company that focuses on academic publishing and instructional materials.

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William H. Beaver

William H. Beaver (born 1940) is an accounting researcher and educator.

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Z-factor

The Z-factor is a measure of statistical effect size.

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Z-test

A Z-test is any statistical test for which the distribution of the test statistic under the null hypothesis can be approximated by a normal distribution.

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References

[1] https://en.wikipedia.org/wiki/Altman_Z-score

Also known as Z-Score Financial Analysis Tool.