Designing a Model of Financial Fragility Evaluation of Companies Listed in the Iranian Stock Exchange

Abstract

Research Objective: Financial fragility is one of the most widely used terms in financial and accounting issues whose evaluation has become an important issue in organizations. The purpose of this qualitative-quantitative study is to design a model for assessing the financial fragility of companies listed on the Tehran Stock Exchange.Methodology: 28 qualitative model variables were extracted in the qualitative section by interviewing 19 experts and determining the relationship between variables to achieve model in the quantitative section by using the interpretive structural modeling (ISM) method. The MICMAC analysis was used to examine the identity of the variables identified in terms of their influence.Research Findings: Variables of interest rate on bank deposits, monetary policy, economic stability, financial crisis, firm’s net asset value (NAV), corporate financing, corporate investments, new financial innovations and changes, corporate debt, rate of return (RoR), financial accelerator performance, credit risks, credit and income dependency, financial savings, financial relationships and interaction, financial performance, board changes, liquidity, financial event prediction, financial productivity disruptions, financial system type, financial constraint, structure financial, financial equilibrium, changes in exchange rate, changes in national currency, stock changes, and unforeseen events were extracted.Conclusion: The purpose is to obtain a six-level model with economic stability as its most influential variable and the only independent variable.

Keywords

• financial fragility
• financial crisis
• financial sustainability
• investors