Next Article in Journal
Market-Risk Optimization among the Developed and Emerging Markets with CVaR Measure and Copula Simulation
Previous Article in Journal
An Urn-Based Nonparametric Modeling of the Dependence between PD and LGD with an Application to Mortgages
Open AccessArticle

Bankruptcy Risk, Its Financial Determinants and Reporting Delays: Do Managers Have Anything to Hide?

1
Faculty of Economics and Business Administration, University of Tartu, Tartu 50409, Estonia
2
Accounting and Finance Department, Complutense University of Madrid, Madrid 28223, Spain
*
Author to whom correspondence should be addressed.
Risks 2019, 7(3), 77; https://doi.org/10.3390/risks7030077
Received: 22 May 2019 / Revised: 30 June 2019 / Accepted: 3 July 2019 / Published: 7 July 2019
The aim of this study was to investigate whether firms’ reporting delays are interconnected with bankruptcy risk and its financial determinants. This study was based on 698,189 firm-year observations from Estonia. Annual report submission delay, either in a binary or ordinal form, was used as the dependent variable, while bankruptcy risk based on an international model or the financial ratios determining it were the independent variables. The findings indicated that firms with lower values of liquidity and annual and accumulated profitability were more likely to delay the submission of an annual report over the legal deadline. In turn, firm leverage was not interconnected with reporting delays. In addition, firms with a higher risk of bankruptcy were more likely to delay the submission of their annual reports. Firms with different ages, sizes and industries varied in respect to the obtained results. Different stakeholders should be aware that when reporting delays occur, these can be conditioned by higher bankruptcy risk or poor performance, and thus, for instance, crediting such firms should be treated with caution. State institutions controlling timely submission should take strict(er) measures in cases of firms delaying for a lengthy period. View Full-Text
Keywords: bankruptcy risk; financial ratios; reporting delays; private firms; SMEs; Estonia bankruptcy risk; financial ratios; reporting delays; private firms; SMEs; Estonia
MDPI and ACS Style

Lukason, O.; Camacho-Miñano, M.-D.-M. Bankruptcy Risk, Its Financial Determinants and Reporting Delays: Do Managers Have Anything to Hide? Risks 2019, 7, 77.

Show more citation formats Show less citations formats
Note that from the first issue of 2016, MDPI journals use article numbers instead of page numbers. See further details here.

Article Access Map by Country/Region

1
Back to TopTop