Revised Altman Model for Bulgarian SMEs Viability Assessment

  • Dimitar Haralampiev Popov UNWE
Keywords: Altman Z-score, viability, CRISP-DM, SMEs


Abstract: Due to their contribution to employment and the economy, small and medium enterprises (SMEs) are an integral part of EUs policies and national programs. Predicting their viability is an important aspect of management decision making. That is why, a modified model is created, based on the Altman’s Z-score, a multivariate classification technique, to help determine the viability of Bulgarian SMEs by using financial ratios from their income statements and balance sheets. Since the data spans over thousands of SMEs, implementing new approaches from information technology is needed. This is the reason to use the cross industry standard process for data mining (CRISP-DM), which is a methodological framework for researching large amounts of data. The results of combining Altman’s Z-score with CRISP-DM in a single SME viability research show that using logistic regression and naive Bayes classifiers can distinguish between viable and non-viable SMEs with a moderate predictive power.



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How to Cite
Popov, D. (2023). Revised Altman Model for Bulgarian SMEs Viability Assessment. Vanguard Scientific Instruments in Management, 19, 221-228. Retrieved from[]=519