Proposal for a Decision Support System to Predict Financial Distress
Proposal for a Decision Support System to Predict Financial Distress

Summary/Abstract: In the context of economic instability a decision support system that could provide early warning signals of financial distress to a company a few years before actually turning to insolvency could play an important role in the decision making processes inside a company. Thus, the aim of this paper consists in developing a decision support system for financial distress for the case of the Romanian companies listed on the Bucharest Stock Exchange. A practical solution for predicting financial distress with one or even two years in advance is presented and the results of the models’ prediction accuracy are encouraging us to believe that these models can actually improve the strategic management and planning departments in a company.

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