Analysis of Financial Distress and its Determinants in Selected SMEs in Wolaita Zone

Analysis of Financial Distress and its Determinants in Selected SMEs in Wolaita Zone

Ephrem G. Selassie

Contact

Ganfure Tarekegn

Contact

Andualem Ufo

Contact

Wolaita Sodo University

Analysis of Financial Distress and its Determinants in Selected SMEs in Wolaita Zone

Article Fingerprint

ReserarchID

C: FINANCE72O5L

Analysis of Financial Distress and its Determinants in Selected SMEs in Wolaita Zone Banner

AI TAKEAWAY

Connecting with the Eternal Ground

Abstract

The development of SMEs is considered as one of vital determinants of the growth of Ethiopian economy, and for secure equitable distribution of the benefits of the economic growth. However, SMEs in the country are leveled as not performing well and falling short of yielding the much anticipated contribution for the growth of the economy as they are expected. This study is conducted to analyze financial distress level of SMEs in Wolaita Zone and indentify those factors affecting their financial health. In this study 30 firms form three sectors are selected as samples selecting ten samples from each of manufacturing, service and trade sector using purposive sampling method. Accordingly, the results of Altman’s Zeta Score Model analysis indicate that three of the ten selected firms in the service sectors are found to be financially distressed, but none of the sampled SMEs in the sector are below the bankruptcy point. In manufacturing sector, one of the ten selected SMEs is found with the Zeta score of below the bankruptcy line and all of the rest of the sampled SMEs are found to be under financial distress though their Zeta score is above the bankruptcy point.

References

21 Cites in Article

Reference Format

Geda Alemayehu (2007). The Structure and Performance of Ethiopia's Financial Sectore in the Pre and Post reform period.
Edward Altman (1983). Multidimensional Graphics and Bankruptcy Prediction: A Comment.
W Ani,D Ugwunta (2012). Predicting Corporate Business Failure in the Nigerian Manufacturing Industry.
Uffa Andualem,Baza (2011). Determinants of Financial Distress in Case of Insurance Companies in Ethiopia.
M Aremu,S Adeyemi (2011). Small and Medium Scale Enterprises as A Survival Strategy for Employment Generation in Nigeria.
W Bever (1966). Financial Ratio as predictore of Failure: Empericalresearch in Accounting.
R Brealey,Meyers (2000). Principles of Corporate Finance.
S Chang-E (2006). The Causes and Salvation Ways of Financial Distress Companies.
Edward Altman (1968). FINANCIAL RATIOS, DISCRIMINANT ANALYSIS AND THE PREDICTION OF CORPORATE BANKRUPTCY.
J Fulmer,J Moon,T Gavin,J Erwin (1984). A bankruptcy classification model for small firms.
Amiyatosh Purnanandam (2004). Do Banks Hedge in Response to the Financial Distress Costs?.
Beatrix Ika,Moh. Burhan,Sugeng Haryanto (2010). The Effect of Good Corporate Governance on Financial Performance Through Risk Management.
Jean-Michel Sahut,Mehdi Mili (2011). Banking distress in MENA countries and the role of mergers as a strategic policy to resolve distress.
Fadare Samuel (2011). Banking Crisis and Financial Stability in Nigeria.
Lewis Saundra,Thornhill (2007). Business Research Methods.
Simonoff (2011). classical linear regression model.
M Sulphey,S Nisa (2013). The Analytical Implication of Altman's Z-score Analysis of BSE Listed Small CAP Companies.
Kenth Skogsvik,Stina Skogsvik,Henrik Andersson (2013). Bankruptcy Risk in Discounted Cash Flow Equity Valuation.
Tesfayenesh Lema,Aregaw (2016). Trade and Gender in the Services Sector of Ethiopia: expert meeting on trade as a tool for the economic empowerment of women.
E Teti,A Dell'acqua,M Brambilla (2012). Alessandro Dell' Acqua, Milan.
(1996). Value Creation after Chinese Firms Acquire Financially Distressed Overseas Firms: Viva’s Acquisition of Clarks Group.

Download References

Funding

No external funding was declared for this work.

Conflict of Interest

The authors declare no conflict of interest.

Ethical Approval

No ethics committee approval was required for this article type.

Data Availability

Not applicable for this article.

How to Cite This Article

Ephrem G. Selassie. 2016. \u201cAnalysis of Financial Distress and its Determinants in Selected SMEs in Wolaita Zone\u201d. Global Journal of Management and Business Research - C: Finance GJMBR-C Volume 16 (GJMBR Volume 16 Issue C8).

More Citation Formats

Select Citation Style:

Download Citation

GJMBR Volume 16 Issue C8

Explore Journals Explore Volume Read This Issue

Journal Specifications

Crossref Journal DOI 10.17406/GJMBR

Print ISSN 0975-5853

e-ISSN 2249-4588

Keywords

Not Found

Classification

GJMBR-C Classification FOR Code: G00

Submission ReceivedDecember 8, 2015
Peer Review Double Blind
Handling Editor
Accepted January 5, 2016
Published January 15, 2016

Version of record

v1.2

Issue date

December 10, 2016

Language

Experiance in AR

Explore published articles in an immersive Augmented Reality environment. Our platform converts research papers into interactive 3D books, allowing readers to view and interact with content using AR and VR compatible devices.

View in VR

Read in 3D

Your published article is automatically converted into a realistic 3D book. Flip through pages and read research papers in a more engaging and interactive format.

View in 3D

Article Matrices

Total Score: 73

Country: Ethiopia

Subject: Global Journal of Management and Business Research - C: Finance

Authors: Ephrem G. Selassie, Ganfure Tarekegn, Andualem Ufo (PhD/Dr. count: 0)

View Count (all-time): 173

Total Views (Real + Logic): 3529

Total Downloads (simulated): 1823

Publish Date: 2016 12, Sat

Monthly Totals (Real + Logic):

Month 1: 21 views
Month 2: 55 views
Month 3: 47 views
Month 4: 20 views
Month 5: 53 views
Month 6: 36 views
Month 7: 41 views
Month 8: 55 views
Month 9: 36 views
Month 10: 35 views
Month 11: 29 views
Month 12: 43 views
Month 13: 31 views
Month 14: 28 views
Month 15: 20 views
Month 16: 40 views
Month 17: 31 views
Month 18: 42 views
Month 19: 14 views
Month 20: 22 views
Month 21: 30 views
Month 22: 11 views
Month 23: 32 views
Month 24: 18 views
Month 25: 22 views
Month 26: 26 views
Month 27: 12 views
Month 28: 33 views
Month 29: 29 views
Month 30: 37 views
Month 31: 31 views
Month 32: 16 views
Month 33: 25 views
Month 34: 33 views
Month 35: 20 views
Month 36: 23 views
Month 37: 24 views
Month 38: 49 views
Month 39: 25 views
Month 40: 37 views
Month 41: 25 views
Month 42: 23 views
Month 43: 25 views
Month 44: 25 views
Month 45: 27 views
Month 46: 35 views
Month 47: 24 views
Month 48: 25 views
Month 49: 31 views
Month 50: 41 views
Month 51: 21 views
Month 52: 35 views
Month 53: 24 views
Month 54: 29 views
Month 55: 20 views
Month 56: 34 views
Month 57: 33 views
Month 58: 12 views
Month 59: 21 views
Month 60: 24 views
Month 61: 46 views
Month 62: 19 views
Month 63: 18 views
Month 64: 21 views
Month 65: 31 views
Month 66: 20 views
Month 67: 13 views
Month 68: 11 views
Month 69: 29 views
Month 70: 36 views
Month 71: 31 views
Month 72: 34 views
Month 73: 39 views
Month 74: 31 views
Month 75: 25 views
Month 76: 43 views
Month 77: 25 views
Month 78: 34 views
Month 79: 39 views
Month 80: 22 views
Month 81: 38 views
Month 82: 34 views
Month 83: 38 views
Month 84: 40 views
Month 85: 34 views
Month 86: 13 views
Month 87: 27 views
Month 88: 17 views
Month 89: 45 views
Month 90: 42 views
Month 91: 20 views
Month 92: 39 views
Month 93: 21 views
Month 94: 35 views
Month 95: 29 views
Month 96: 28 views
Month 97: 36 views
Month 98: 47 views
Month 99: 27 views
Month 100: 29 views
Month 101: 25 views
Month 102: 29 views
Month 103: 21 views
Month 104: 42 views
Month 105: 23 views
Month 106: 43 views
Month 107: 39 views
Month 108: 16 views
Month 109: 15 views
Month 110: 49 views
Month 111: 39 views
Month 112: 45 views
Month 113: 43 views

Total Views: 3529

Total Downloads: 1823

2026 Trends

Our website is actively being updated, and changes may occur frequently. Please clear your browser cache if needed. For feedback or error reporting, please email [email protected]