This research investigates the way in which Neural Networks (NNs)
can be used to forecast insolvency. The research aimed at forecasting, oiie for three years in advance, a clear disclosure of tlie legal condition of insolvency in a jointstock company based in Italy and operating in the textile industry, throngh the analysis of the official balance sheet. The results refer to experiments which have been carried out for three years, concerning a sample of about 500 conipanies in the textile sector, their balance sheets for a three-year period (1990-1992) and the state of the art in the following two years (1993-1994). The research has pointed out how the problem of insolvency can be dealt with by using NNs in a satisfactory way and has proved useful to show how important the method of collecting data for a further analysis throngh NNs can be.
This research investigates the way in which Neural Networks (NNs)
can be used to forecast insolvency. The research aimed at forecasting, one for three years in advance, a clear disclosure of tlie legal condition of insolvency in a jointstock company based in Italy and operating in the textile industry, through the analysis of the official balance sheet. The results refer to experiments which have been carried out for three years, concerning a sample of abont 500 coinpanies” in the textile sector, their balance sheets for a three-year period (1990-1992) and the State of the art in the following two years (1993-1994). The research has pointed out how the problem of insolvency can be dealt with by nsing NNs in a satisfactory way and has proved useful to show how important the method of collecting data for a further analysis throngh NNs can be.
Statistics, Operations Research and Artificial Intelligence are often
used to identify the factors that irifluence certain phenomena of real life based on sarnples of data. In the variety of data analysis techniques suggested by these disciplines, the classification capability of Logical Analysis of Data, proposed by Hammer in [12], is compared to the neural networks in the well-known financial classification problém of insolvency.