Research Of Early-warning Model Of Financial Crisis Based On Company’s Value And Corporate Governance

In the role of world economic integration and market economy, the marketenvironment is full of changes and competition. In addition to financial risk thatobjectively exists in management process has an effect on crisis that may arise, thecorporate governance and company’s value may also be indirect role i n the financialcrisis. The company’s financial crisis did not happen in the short term, but after arelatively long-term accumulation of management defects or financial risk, therefore,to establish an effective may be the most direct and efficient way.In the study of the early-warning model of financial crisis on listed companies,not only joined the company’s value, but also use Economic Value Added (EVA) todescribe the value of the company, to discuss the early-warning model of financialcrisis that including the important financial indicators and non-financial indicatorsfrom the point of view of company’s value. Model is divided into three categories:adding company’s value and corporate governance factors; excluding corporategovernance factors; excluding the value of the company’s. Through the goodness of fit,relevance, significance of independent variables, as well as the accuracy of testing toselect more effective models. This research selected60A-share listed companies thatwas ST and*ST as samples in Shanghai and Shenzhen Stock Exchange between2011-2013, and select60healthy companies that the industry, listing time and scaleare so similar to pair the crisis companies, and did some empirical analysis throughLogistic regression models. This research selected30crisis companies and30healthycompanies to substitute in the models that already established. From the perspectiveof time，two years berore ST and*ST was a better forecast period; From the categoryof models, the early-warning model of financial crisis that including the company’svalue has the higher predictive ability.Finally, This paper propose some policy suggestions as setting period of theearly warning value and establishing early warning system of company’s value. It alsonoted the innovation, the inadequacies and possible future research directions.