Principal, APGCMS, RajamPet, Kadapa, A.P
Online published on 5 July, 2013.
The financial requirements of a business must be sufficient to meet its long-term and short-term commitments. The Z-score is a linear combination of four or five common business ratios, weighted by coefficients. To evaluate the financial conditions and performance of a company, the financial analysis needs certain yardsticks. ‘Z’-score model captures the predictive viability of a company's financial health by using a combination of financial ratios that ultimately predicts a score, which are used to determine the financial health of a company.
financial condition, Z-score, coefficients, ratios