Bankruptcy Prediction for Oil and Gas Companies in Indonesia Using Z-Score Method
- DOI
- 10.2991/aebmr.k.210831.026How to use a DOI?
- Keywords
- Bankruptcy Prediction, Z-Score, Oil Price
- Abstract
Global oil price condition for these past few years has been fluctuating and has reached the lowest level. This condition will affect oil and gas companies’ financial health. This thesis aims to predict the bankruptcy probability of Indonesia’s oil and gas companies from 2011 to 2017. The observed companies are oil and gas companies that are listed on IDX. Another aim of this thesis is to observe whether the decline in oil price would influence the company’s Z-Score result or not and observe which variable affects the bankruptcy of oil and gas companies. This research uses financial data obtained from the IDX website and the company’s website. The result of the research figures out that the Z-Score model could predict at least five companies will face bankruptcy from 2014 to 2017. In 2011, only two companies that are predicted will be bankrupt. In 2012, only one company will be bankrupt, and in 2013 three companies are predicted to be bankrupt. This research also figures out that the decrease in oil price affects the result of Z- Score for E&P companies as E&P companies revenue relies on oil price in the market. For service companies, the decrease in oil price does not directly impact APEX and BIPI, which their line business is providing services for drilling explorations. Companies with low Z-Score are likely to have negative EBIT, low current assets, and high company debt.
- Copyright
- © 2021, the Authors. Published by Atlantis Press.
- Open Access
- This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).
Cite this article
TY - CONF AU - Aditya Ramadhana Djaja PY - 2021 DA - 2021/09/02 TI - Bankruptcy Prediction for Oil and Gas Companies in Indonesia Using Z-Score Method BT - Proceedings of the 5th Global Conference on Business, Management and Entrepreneurship (GCBME 2020) PB - Atlantis Press SP - 126 EP - 131 SN - 2352-5428 UR - https://doi.org/10.2991/aebmr.k.210831.026 DO - 10.2991/aebmr.k.210831.026 ID - Djaja2021 ER -