Analysis of Differences Between Altman's and Zmijewski's Models in Predicting Financial Distress

Abstract

This study aims to see the comparation between Altman model and the Zmijewski model in forecasting financial problems in transportation corporation indexed on the Indonesia Stock Exchange (IDX) during 2019- 2021. This research used descriptive quantitative method and select the sample using purposive sampling method, which is using certain criteria to select the sample. To test the hypothesis about the difference between two models, the research data is testing with wilcoxon test. The findings showed that there was no substantial difference between the Altman model and the Zmijewski model in forecasting financial problems in corporations indexed on the IDX during 2019-2021. However, the Zmijewski model is more accurate in forecasting financial problems in transportation corporations indexed on the IDX during that period.This research is important because it can help companies take the right steps when facing financial problems that can lead to bankruptcy.