PROPOSE SOLUTION TO IMPROVE FINANCIAL PERFOMANCE OF PT T Tbk IN ACCORDANCE TO ALTMAN Z SCORE PREDICTIVE MODEL
In the middle of fluctuate and uncertainty business situation, a business entity is susceptible to any cause that weaken the business entity. The impairment of business entity can haul a business entity to the tip of bankruptcy . The bankruptcy process can be a catastrophe to the company itself, inv...
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| Format: | Theses |
| Language: | Indonesia |
| Online Access: | https://digilib.itb.ac.id/gdl/view/11962 |
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| Institution: | Institut Teknologi Bandung |
| Language: | Indonesia |
| Summary: | In the middle of fluctuate and uncertainty business situation, a business entity is susceptible to any cause that weaken the business entity. The impairment of business entity can haul a business entity to the tip of bankruptcy . The bankruptcy process can be a catastrophe to the company itself, investor, employer and any kind that have relationships with the company. Altman Z Score is one method to predict company bankruptcy. This method is used and calculated by selected financial ratio (ratio that has the biggest contribution in Altman predictive model at 66 companies, 1968).PT T Tbk is the object in this research. The company is a plastic manufacture and produce plastic houseware.<p>Altman predictive model use 5 weighted ratios which are selected and have big contribution at 66 companies, 1968. The 5 ratios in Altman predictive model are X1(net working capital/total assets) weighted score 1.2, X2(retained earnings/total assets) weighted score 1.4, X3(EBIT/Total Assets) weighted score 3.3, X4(market value of equity/book value of total liabilities) weighted score 0.6 and the last is X5 (sales/total assets) weighted score 1.0. The Z Score are the sum of all the ratio above. After the score are already got, further research should be conducted to determine bad sector in the company. The research also helpful to suggest the solution that will increase the company's performance.<p>After the exploration on every ratios, solution proposal should be made to increase the company's performance. This solution are made according to every ratios in the Altman Z Score predictive models. The propose solutions are focused on increasing company net working capital and to increase overall company's Z Score. The purpose of the solution is to increase company's financial health. For the implementation, simulation on the increasing of net working capital and the impact on company's Z Score |
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