Changes in bankruptcy indicators of banks in Colombia from convergence to Colombian Financial Reporting Standards
Abstract
The purpose of this article is to examine the effect that convergence to Colombian Financial Reporting Standards (CFRS) had on the possibility of bankruptcy of banking establishments from the analysis of their bankruptcy indicators. In Colombia, starting in 2014, the transition to these standards was required, which are based on the International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board (IASB). The works developed at the international level show the application of statistical methods to analyze the effects of the implementation of IFRS, in this sense, this work includes analysis of quantitative data as a contribution to the Colombian literature on this topic. For this, a multiple discriminant analysis model called Altman’s ZII Score was used as a bankruptcy predictor, in 24 banks during 2014 without CFRS and 2014, 2015 and 2016 with CFRS. Among the findings is that a significant proportion of the banks remain in the same area in which they were before starting the process of transition to IFRS.
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