Kuldeep Kumar

Bond University

Bankruptcy prediction using decision tree technique

Accurate business failure prediction models would be extremely valuable to many industry sectors, particularly in financial investment and lending. The potential value of such models has been recently emphasised by the extremely costly failure of high profile businesses in both Australia and overseas. In this paper, the various statistical techniques used in previous studies are presented and reviewed, including two alternative techniques that have produced promising results, namely survival analysis and decision trees.