ABSTRACT
Multiple variables analysis is based on the opinion that these variables are related and could not be considered respectively so that we need to consider these variables integrally and choose core variables to analyze comprehensively. Ohlson firstly introduced logistic regression analysis into multivariate analysis for early warning of financial crisis. And he analyzed enterprises bankruptcy probability interval distribution the relationship between the two types of errors and dividing point with the prediction accuracy rate
1 INTRODUCTION
As one of the most important industries in the national economy, construction industry has achieved rapid development in the recent 20 years.[1,2] Having characteristics of long cycle, high investment, high risk, high yield, construction industry plays an essential role in the economic and social development. In recent years, construction enterprises are faced with more and more complex environment, growing severe challenges and highcompetitive construction market. Macro-control on real estate industry by the government and financial institutions is gradually strengthening. Asset-liability ratio in the construction business is generally more than 70% so that construction enterprises are under enormous financial risks and increasing likelihood of financial crises.[3]
Financial crisis, also called financial distress, reflects one kind of economic phenomena that an enterprise is unable to pay debts or fees due to financial management failures. Based on accounting information, early warning for financial crisis management implements real-time monitoring and predictive alerts to the financial crisis which the enterprise may or will be faced with by setting and observing the changes in the sensitivity of early warning indicators. It greatly helps business owners keep abreast of the problems in the
of 96.12%.[7] Logistic regression analysis methodology improves early warning for financial crisis a lot and it avoids many problems of traditional analysis methodology.[8,9] Combined with the current situation of the construction industry in China, this paper chooses 40 listed construction companies as samples and chooses 24 financial indexes which can reflect company financial condition comprehensively as analysis variables. Using logistic regression analysis methodology, it analyzes principal components from multiple financial variables and develops an early warning approach for financial crisis management for construction enterprises with a logistic regression model to analyze and evaluate financial abilities of construction enterprises.
