An Analysis of the Efficacy of the Altman Bankruptcy Model using Z-Score in Oil and Gas Sub-Sector Companies Listed at Indonesian Stock Exchange

  • Francis M. Hutabarat
  • Laura Siringoringo
Keywords: Altman Method, Bankruptcy, Indonesian Stock Exchange


The picture of prosperity and financial robustness that every company reflects is
affected by the estimation of its position. Thus, the ability to predict bankruptcy may be
important for financial users, but it also may be crucial for investors, creditors, stakeholders,
credit rating agencies, auditors and regulator.
It is important for a company to be able to predict bankruptcy as early as possible and vital also
in periods of financial and economic crisis. Hence, assessments of company’s losses are needed
under various level of financial distress The method in this study is descriptive, and Altman
method of Z-Score were used to analyzed the data given from companies listed in the Oil and
Gas Sub Sector at Indonesia Stock Exchange. Results from the study showed that in the
calculation using Altman method there are three companies in the bankrupt categories namely
ARTI, ENRG and MEDC in year 2014 whereas one companyis not in the state of insolvency,
which is ELSA based on year analysis period of 2010-2014.