Research On Financial Crisis Early Warning System Of Listed Company

The company's financial situation is the focal point of the related groups such as share holders, creditors, suppliers, employees, governments of the company. The company which runs well in both sides operation and finance can not only increase prestige in the market and expand financing channels, but also encourage investors and other related interest groups, and then get more support and convenience. On the contrary, the company which faces financial difficulties or crisis will make original interest ownership panic and potential investors stop their steps, and lose more chances and abilities of sustained development.So, building up a financial crisis early warning system for listed company can take precautions. The system can verdict the magnitude of the crisis and risks, prevent listed company from possible financial crisis. Also, it is vital to keep market developing healthily and listed company having sound financial situation, to protect interests of investors.By using method of quantitative or qualitative analysis based on statistics, science of financial management and science of risk control and methodology of financial crisis early warning system including system theory, information theory, cybernetics, and combining with theories of enterprise management and early warning management, the paper builds up basic framework of China listed company financial crisis early warning system and analyzes operation mechanism and conditions of each subsystem in the whole system. The paper consists of six chapters:Chapter one, which is the part of introduction, explains the research background and purpose, and briefly reviews the financial crisis early warning system research at home and abroad. It also clearly purposes the research approach and the way of thinking, and puts forward some possible innovations.Chapter two formulates the related theories of financial crisis warning system. This part firstly reviews literature of financial crisis at home and abroad. And then discusses methodology and theories of building up financial crisis early warning system. Taking the function of warning system as a point of departure, it works out the framework of modern listed company financial crisis early warning system concentrated on early warning analysis mechanism, the early warning mechanism of organization and information as well as crisis management.Chapter three focuses on building up platform of listed company financial crisis early warning system. This part constructs two platforms of both warning organization mechanism for organizational guarantees and warning information for information support. And then it details mechanism and conditions of two interactional platforms.Chapter four studies early warning analysis mechanism of listed company financial crisis. Firstly, this part analyzes characteristics of financial crisis in each phase, and then discusses the whole process and principle of Logistic Regression Analysis Empirical Modeling of dichotomy with factorial analysis from sample designing, index earlier choosing, index concentration until to Logistic Regression Modeling. At last, the paper analyzes class and level of precaution and warning, makes a deeper analysis of internal and external factors of inducing financial crisis. According to these factors, some suggestions were given to guard against and defuse financial risks and crisis.Chapter five mainly talks about crisis management mechanism of listed company financial crisis early warning and points out several different measures to different warning. Weak warning is usually considered a kind of financial risk which can be easily eliminated. Otherwise, strong warning appearance is believed that financial crisis had already happened and financial crisis management mechanism should be used. The paper discusses about operation mechanism and counter-measure under these two different conditions.Chapter six concludes the research process and findings of this paper and points out limitation of the paper study, put forward continuous research directions.