One way that can be used to good advantage of investment opportunities and a better allocation of resources, is predicting financial failure or bankruptcy. The study tries to evaluate accuracy and effectiveness of the audit reports in identifying bankrupt firms, and compare it to predictability of bankruptcy by the financial variables. Criteria for diagnosis of bankruptcy companies, subject to article 141 of commercial law is. The Infrastructure hypothesis is as follows: Independent auditor's report in terms of uncertainty about going concern can predict bankruptcy in the next fiscal period better than financial variables simultaneously. The above hypothesis using a sample of 60 manufacturing companies listed in Tehran Stock Exchange during 1381 to 1387 (seven years) by logistic statistical model and McNamara test were tested. Results from this study suggests that financial variables simultaneously and independent auditor's report, both have the ability to predict bankruptcy in the next fiscal period, but the independent auditor's report is significantly superior to the financial variables.
Bakhtiary, M., Zendedel, A., & Esmaeilzadebaghsiyahi, M. (2011). Comparison to woo independent auditors and financial variables in predicting bankruptcy. Accounting and Auditing Review, 18(65), 63-78.
MLA
Massood Bakhtiary; Ahmad Zendedel; Mahdi Esmaeilzadebaghsiyahi. "Comparison to woo independent auditors and financial variables in predicting bankruptcy", Accounting and Auditing Review, 18, 65, 2011, 63-78.
HARVARD
Bakhtiary, M., Zendedel, A., Esmaeilzadebaghsiyahi, M. (2011). 'Comparison to woo independent auditors and financial variables in predicting bankruptcy', Accounting and Auditing Review, 18(65), pp. 63-78.
VANCOUVER
Bakhtiary, M., Zendedel, A., Esmaeilzadebaghsiyahi, M. Comparison to woo independent auditors and financial variables in predicting bankruptcy. Accounting and Auditing Review, 2011; 18(65): 63-78.
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