Prediction of Firm's Life cycle and Financial Performance Appraisal using Decision trees Algorithm and Multi-criteria Decision-making Techniques
Subject Areas :
Zinat Ansari
1
,
Rezvan Hejazi
2
,
Yaghoob Zeraat Kish
3
,
Zabihelah Khani Masoomabadi ‎
4
1 - Accounting Department, Yasouj Unit, Islamic Free University, Yasouj, Iran
2 - Department of Accounting, Khatam University, Tehran, Iran (corresponding author
3 - Research Sciences Unit, Islamic Free University, Tehran, Iran
4 - Accounting Department, Fasa Unit, Islamic Free University, Fasa, Iran
Received: 2022-12-29
Accepted : 2023-03-02
Published : 2023-03-21
Keywords:
Performance Appraisal,
decision-making,
Keywords: Life cycle,
Abstract :
Abstract
Optimal selection of a company for investment considering its financial ratios is a challenge that is expected to be somewhat simplified by reducing the amount of data. Accurately recognizing the relative importance of metrics in any company is not easy for many decision-makers and investors. The purpose of this study is to provide methods for decision-making that can be implemented without specialized financial knowledge. For this purpose, a sample of 172 companies listed on the Tehran Stock Exchange as a company-year, during the period 2008-2019 was examined. First, the financial ratios were prioritized using decision tree regression analysis (type CART) to predict the life cycle. The results showed that the cash ratio and Debt to Equity Ratio were the most and the least important factors, respectively. Then, using fuzzy hierarchical analysis (FAHP) and TOPSIS, financial ratios were prioritized to evaluate the Financial Performance of companies that leverage ratios and profitability ratios had the highest and lowest ranks, respectively.
References:
فهرست منابع
آبادیان، مرضیه، هوشنگ شجری(1395)، روش چند شاخصه برای انتخاب سبد سهام بهینه با استفاده از متغیرهای تحلیل بنیادی در شرکت های پتروشیمی عضو بورس، مجله مهندسی مالی و مدیریت اوراق بهادار، شماره 26، صص 25-1.
پورزمانی، زهرا (1396)، کارایی معیارهای ارزیابی ریسک در تئوری فرامدرن پرتفوی در صندوقهای سرمایه گذاری مشترک در دوران رونق تجاری، فصلنامه پژوهشهای حسابداری مالی و حسابرسی، شماره33، سال 9، صص79-65.
شهدایی، سید محمدعلی (1397)، "ارزشگذاری سهام بر مبنای P/E" ، چاپ چهارم، تهران، انتشارات چالش.
صیدخانی، رضا، عطاالله محمدی ملقرنی، پیمان امینی، (1400)، بررسی توانمندی جریان های نقدی عملیاتی در ارزیابی عملکرد شرکت ها با تأکید بر کیفیت افشا در دوره های بحران مالی، فصلنامه پژوهشهای حسابداری مالی و حسابرسی، شماره 49، سال 13، صص 176-147.
ملکی، الهام السادات، سیدکاظم ابراهیمی، فاطمه جلالی(1398)، تأثیر چرخه عمر شرکتها بر سطح محافظه کاری" فصلنامه پژوهشهای‌حسابداری مالی و حسابرسی، شماره 44، سال 11، صص78-59.
مهرانی، ساسان، کاوه مهرانی، غلامرضا کرمی(1383)، استفاده از اطلاعات تاریخی مالی و غیرمالی جهت تفکیک شرکتهای موفق از ناموفق. بررسی‌های حسابداری و حسابرسی، شماره 38، سال 11، صص 92-77.
نادری، علی، محسن دستگیر، فرزاد کریمی(1400)، تأثیر چرخه عمر و اختیار توسعه بر نقش تعدیل کننده کیفیت گزارشگری مالی در بهبود تأثیر محدودکننده سیاست تقسیم سود، فصلنامه پژوهشهای‌حسابداری مالی و حسابرسی، شماره 50، سال 13، صص82-55.
نصیری، سپیده سادات، غلامرضا سلیمانی امیری(1399)، ارزیابی عملکرد مالی شرکتهای سرمایه گذاری در ایران، فصلنامه پژوهشهای حسابداری مالی و حسابرسی، شماره 45، سال 12، صص 160-135.
_||_
Abdel-Basset, M., & Mohamed, R. (2020). "A novel pathogenic TOPSIS- CRITIC model for sustainable supply chain risk management", Journal of Cleaner Production, 107, PP 2411-2502.
Affandi, F., Sunarko, B., Yunanto, A. (2018). "The Impact of Cash Ratio, Debt To Equity Ratio, Receivables Turnover, Net Profit Margin, Return On Equity, and Institutional Ownership To Dividend Payout Ratio", Journal of Research in Management, 1, PP 1- 11.
Akbar, A., Akbar, M., Tang, W., Qureshi, M. A. (2019). "Is bankruptcy risk tied to corporate life-cycle? Evidence from Pakistan", Sustainability, 11, 678.
Ban, A. I., Ban, O. L., Victoria, B., Sabau Popa, D. C., Tuse, D. (2020). "Performance evaluation model of Romanian manufacturing listed companies by fuzzy AHP and TOPSIS", Technological and Economic Development of Economy, 26, PP 808-836.
Budiarso, N. S., Subroto, B., Sutrisno, T., Pontoh, W. (2019). "Dividend catering, life-cycle, and policy: Evidence from Indonesia". Cogent Economics & Finance, 7, PP 1-15.
Bulgurcu, B. K. ) 2012(. "Application of TOPSIS technique for financial performance evaluation of technology firms in the Istanbul Stock Exchange Market". Procedia-Social and Behavioral Sciences, 62 , PP 1033 – 1040.
Caro, N. P.; Guardiola, M. & Ortiz, P.(2018). “Classification trees as a tool to predict financial difficulties in Latin American companies through their accounting ratios”. Contaduría y Administración, 63, issue 1, pp. 25- 26
Cheng, C. H., Chen, C.T., Huang, S. F.) 2012(. "Combining fuzzy integral with order weight average (OWA) method for evaluating financial performance in the semiconductor industry". African Journal of Business Management, 6, PP 6358-6368.
Daneshvar Rouyendegh, B., Yildizbasi, A., Yilmaz, I. ( 2020). "Evaluation of retail ındustry performance ability through ıntegrated ıntuitionistic fuzzy TOPSIS and data envelopment analysis approach". Methodologies and Application, 24, PP12255-12266.
Delen, D., Kuzey, C., Uyar, A. ( 2013). "Measuring firm performance using financial ratios: a decision tree approach". Expert Systems with Applications, 40, PP 3970–3983.
Dickinson, V. (2011). "Cash flow patterns as a proxy for the firm life cycle". The Accounting Review, 86, PP 1969-1994.
Eulaiwi, B., Al-Hadi, A., Hussain, S. M., Al-Yahyaee, K. H. (2018). "Investment Committee, Corporate Cash Holdings, and Corporate Life Cycle". International Review of Finance. 20, PP 757-769.
Houldsworth, E., Marra, M., Brewster, Ch., Brookes, M., Wood, G. (2021). "Performance appraisal and MNEs: The impact of different capitalist archetypes". International Business Review, 30, PP1-29.
Lu, L., Zhi-Hua, S., Wei, Y., Dun, Z., Sai Leung, N., Chong-Fa, C., A-Lin, L. (2018). "A fuzzy analytic hierarchy process (FAHP) approach to eco-environmو ental vulnerability assessment for the danjiangkou reservoir area, China". Ecological Modelling,220, PP 3439-3447
Najadat, H., Al-Daher,I., Alkhatib, Kh.(2020) “Performance Evaluation of Industrial Firms Using DEA and DECORATE Ensemble Method”The International Arab Journal of Information Technology, 17,5, pp 750-757.
Omidi, M., Min, Q., Moradinaftchali, V., Piri, M. ) 2019.( "The Efficacy of Predictive Methods in Financial Statement Fraud". Discrete Dynamics in Nature and Society, 4, PP 1-12.
Omrani, S., Jafari, M., Mansori, A. (2019). "Analysis of Financial Performance of Cement Industry Manufacturing Companies in Tehran Stock Exchange Using the FAHP Technique and the TOPSIS Method". independent journal of management & production (ijm&p), 10, PP 512-536.
Onder, E., Altintas, A. (2017). "Financial Performance Evaluation of Turkish Construction Companies in Istanbul Stock Exchange (BIST)". International Journal of Academic Research in Accounting, 7(3).
Pätäri, E., Karell, V., Luukka, P., Yeomans, J. S. (2018). "Comparison of the multicriteria decision-making methods for equity portfolio selection: The U.S. evidence". European Journal of Operational Research, Elsevier, 265, PP 655-672.
Ptak-Chmielewska, A. (2019). "Predicting micro-enterprise failures using data mining techniques". journal of Risk Financial Manag, 12, PP 1-30.
Staňková, M., Hampel, D. (2018). "Bankruptcy prediction of engineering companies in the EU using classification methods". Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 66, PP 1347-1356.
Stewart, G. B. (1991). "The Quest for Value: A Guide for Senior Managers, New York: Harper Business Publisher, P 22.
Yahiaoui, D., Nakhle, S.F., Farndale, E. (2021). "Culture and performance appraisal in multinational enterprises: Implementing French headquarters' practices in the Middle East and North Africa subsidiaries". Human resource management, 60, pp 771-785.
Yalcin, N., Bayrakdaraglu, A., Kahraman, C. (2012). "Application of fuzzy multi-criteria decision-making methods for financial performance evaluation of Turkish manufacturing industries". Expert Systems with Applications, 39, PP 350-364.
Yucesan, M., Gul, M. (2020). "Hospital service quality evaluation: an integrated model based on Pythagorean fuzzy AHP and fuzzy TOPSIS". Methodologies and Application, 24, PP 3237-3255.
