ANALISIS POTENSI FINANCIAL DISTRESS BERDASARKAN MODEL PREDIKSI ALTMAN MODIFIKASI

Abstract

The objective of this research is to predict the potential of financial distress in cement companies listed on the Indonesia Stock Exchange in the period of 2016-2020. Using saturated sampling method, all five companies were selected as the sample, who were observed for five years. This quantitative study uses discriminant analysis. The variables of this research were referred to the study of Edward I. This study uses the modified Altman consisting of working capital to total assets (WC/TA), retained earnings to total assets (RE/TA), earnings before interest and taxes to total assets (EBIT/TA), and book value of equity to book value of debt (BVE/BVD). The results of the analysis suggest that the four variables above are able to significantly distinguish cement companies that are under financial distress and those which are not because the F test and the Wilks’ Lambda test resulted in the significance value of < 0.05. In addition, WC/TA ratio is the dominant predicting variable in differentiating the two groups of companies as it has the highest loading value, i.e. 0.840.