Research On Listed Company’s Financial Crises Forecasting Based On Dominance-Based Decision-Theoretic Rough Set

Company’s financial crises forecasting is of great practical significance to investors, owners and managers. In real life, many problems can be treated as three-ways decision of decision-theoretic rough set, as well as financial crises forecasting. Based on the review of financial crisis prediction research status, decision-theoretic rough set is expanded from equivalence relation to dominance relation, and the model is applied to finance crises predicting, building the model of listed company’s finance crises predicting based on dominance-based decision-theoretic rough set. In this model, companies are classified into three categories according to financial position:normal, failing and delayed. The main work and results of this paper are as follows:Firstly, financial crisis prediction research status and the definition of financial crisis are reviewed.Secondly, the basic concept and attribute reduction algorithms of rough set theory are reviewed. What is more, a new algorithm of attribute reduction of dominance-based rough set is proposed, and an example is given to verify the feasibility and effectiveness of this new algorithm.Thirdly, theoretical study and application research of decision-theoretic rough set are reviewed. Put forward the relative loss effect scale to provide a basis for the determination of relative loss effect. Dominance-based decision-theoretic rough set is first proposed by expanding decision-theoretic rough set from equivalence relation to dominance relation.Finally, the financial crises predicting model based on dominance-based decision-theoretic rough set is built, and the implementation steps of the model are presented.The results of the application example coinside with reality well, indicating the feasibility and effectiveness of the model, which can give some ideas for financial crises forecasting.