Applied Research Of Financial Risk Early Warning Model Based On Logistic Regression Model

With the increasing of the economic globalization，the competition in theenterprises is becoming increasingly fierce. In recent years, more and moreenterprises have come into financial crisis even bankruptcy. The number ofbankruptcy is rising and is spreading on a wide range. And as the main force ofagriculture industrialization, agricultural listed companies don’t escape from thebad luck. Agricultural listed companies are one of the main ways of agriculturecapitalization, they are the main force which they participate in internationalcompetition at the WTO background. Agricultural listed companies meet thereform and development opportunities.At the same time they face more intensecompetition, face new, more risk and crisis. For a long time, the listed companiesfinancial warning research mainly concentrated on the developed countries suchas Britain or America, however we start later about the research. And mostlyprevious studies regard the listed company as the research object.the financialwarning research which is applied to a specific industry is very little. Given TheCircumstances, this study is based on China’s agricultural listed companies.This paper will be based on the literature at home and abroad, introducesthe related theory of financial risk warning and crisis enterprise definition, thencompares and analyzes the financial warning models used. This paper usesLogistic regression analysis and Factor analysis. This paper regards2011allagricultural listed companies of Shenzhen stock exchange and Shanghai stockexchange as research samples. And by Factor analysis and Logistic regressionanalysis it considerers of the characteristics of the agriculture, constructs the model of the financial risk warning which is suited to our agricultural listedcompanies. It will be used to predict the financial crisis and to reduce the losscaused by the enterprise bankruptcy.The research gets the conclusion: enterprise financial condition is influencedmainly on solvency ability, assets turnover capacity and profit ability. The mainfinancial indicators of influencing on financial status are the ratio of workingcapital assets, assets debt ratio, assets reserves ration, current ration, acid testration, asset turnover ratio, sales growth and earnings per share. The overallforecast effect of the model is86.05%, and the fitting degree is high, It has theuse of high value. It can correct the actual financial condition, make theenterprise timely find problems and correspond measures, respond actively tothe financial risk. It will have the practical significance for agricultural listedcompanies.