Prediction of Firms Bankruptcy based on industry characteristics

Over the years, the issue of predicting the going concern of economic entities in the future as an important element in the making decision to invest has attracted the attention of many researchers. In Iran also there has been a lot of research in the field of bankruptcy prediction. However, the majority of them have provided a general model for all industries as one unit.
The main objective of this study is to create a new chapter in this area by developing bankruptczy prediction model based on industries characteristics. Therefore, in this research it is tried to provide proper bankruptcy prediction model, specific for each industry, for three industries such as Food & Beverage, except for sugar products, chemical products, and automobile and parts manufacturing, using discriminant analysis techniques.
To determine non-bankruptcy or bankruptcy of the company is used from the criteria of Article 141 in Commercial Code. This research was performed from 2001 to 2013. The results show that the designed model has a prediction accuracy of 90.5, 97.2 and 90.9 percent for industrial Food & Beverage, except for sugar products, chemical products, and automobile and parts manufacturing respectively. These figures reflect high accuracy on these three models.