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Financial distress determinants of the government linked companies (GLC) in Malaysia

Mohd Adha, Leman (2021) Financial distress determinants of the government linked companies (GLC) in Malaysia. Masters thesis, Universiti Utara Malaysia.

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A company’s financial distress can be critical and have long -term effects if not addressed with comprehensive strategic actions and plans. Financial distress will have an impact on investment activity, capital flows, and a significant impact on a company’s performance. The purpose of this study was to measure the level of financial stress faced by the company. This study focuses on Government Linked Companies (GLCs). GLCs are companies that are commercially objective and have interests in the government. Having significance can be construed with a government where the appointment of the board of directors, top management, and key decision-making involves the company being directly controlled by the government. Therefore, this government -linked company is very important to study its level of financial performance. This study will measure financial distress among 30 Government Linked Companies (GLCs) comprising various sectors. To measure the level of financial distress of a company, will use financial ratios such as Leverage ratio, Profitability ratio, Liquidity ratio, and Total Assets owned by the company and this also shows the correlation of financial ratios with Altman Z-Score Model. Based on previous studies, various methods have been used to measure the level of financial distress of companies by conducting studies on companies in various sectors such as the energy sector, construction, SMEs, and others. In addition, various measurement methods have been used such as financial ratios, Altman Z-Score Model, Grover, and Zmijewski. In this study, E-View 10 was used to analyze the data and the method used was Logit Regression Analysis (Stepwise Forward) to obtain the relationship between financial ratio and Altman Z-Score Model. The results in this study found that the debt ratio and total assets have a strong correlation which is a determinant of a company’s financial distress.

Item Type: Thesis (Masters)
Supervisor : Mazlan, Ahmad Rizal
Item ID: 10324
Uncontrolled Keywords: Financial Distress, Government Linked Companies, Financial Ratio, Logit Regression Analysis
Subjects: H Social Sciences > HG Finance
Divisions: School of Economics, Finance & Banking
Date Deposited: 01 Mar 2023 04:01
Last Modified: 01 Mar 2023 04:01
Department: School of Economics, Finance & Banking
Name: Mazlan, Ahmad Rizal
URI: https://etd.uum.edu.my/id/eprint/10324

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