CAN FINANCIAL RATIOS PREDICTS FINANCIAL DISTRESS? EVIDENCE FROM FORCED DELISTED INDONESIAN COMPANIES 1993-2017

Abstract

This study aims to analyze the factors that influence financial distress in forced delisted companies during 1993-2017 from the Indonesian Stock Exchange (IDX). The previous studies, in general, focus on all delisted companies, while this study focuses on the forced delisted companies. The factors are liquidity, solvency, profitability, sales growth, and size.The sample in this study is 38 forced delisted companies, from the whole 121 delisted companies during 1993-2017. The data analysis technique used in this research is multiple regression analysis. Based on the results of the analysis conducted, the studyfound that solvability and size have a significant negative effect on financial distress; while leverage and size have a significant positive effect on financial distress in the forced delisted companies.