Predicting Financial Failure and its Impact on Reducing Financial Risks the Mediating Role of the Financial Analysis Models

Abstract

The present study aimed to shed a light on the prediction of financial failure. It also aimed to identify the impact of the prediction of financial failure on financial risks. It also aimed to identify the mediating role of the financial analysis models. The descriptive analytical approach was adopted. Through using the Kida Model, the researcher of the present study analyzed the financial statements of five Jordanian public joint stock companies that were liquidated or under liquidation were reviewed for the three years preceding their liquidation.  He found that the financial failure of companies can be predicted through using financial models, such as: Kida Model. He recommends obliging public joint-stock companies to measure the financial failure indicators in a regular manner. That should be done to enable companies to avoid incurring financial losses.