Bankruptcy Prediction for Large and Small Firms in Asia: A Comparison of Ohlson and Altman

Bankruptcy Prediction for Large and Small Firms in Asia: A Comparison of Ohlson and Altman

This paper reports the results of a research study examining the comparative abilityof Ohlson’s Logit model and Altman’s four-variance model for predicting bankruptcyof large and small firms in Thailand. A matched pair sample of 60 bankrupt and 60nonbankrupt firms were examined over the years 1998 to 2003. The study concludesthat while each of the two methods have predictive ability when applied to Thai firms,there is no significant difference in their respective predictive abilities for either largeasset or small asset Thai firms.