Abstract:

The financial situation of enterprises is subject to both the practitioners and the researchers. Especially in the last twenty years, it has been revealed that external dynamics as well as internal dynamics are influential in the operations of the enterprises with the removal of barriers to capital and the globalisation of the capital markets. Many enterprises face financial failure due to these internal and external causes. The fragility of emerging markets, especially during times of crisis, increases the risk of failure. In the event of financial failure, companies may face various negative situations. The delay of firms in taking measures against these types of negativities increases the probability of bankruptcy. For this reason, it is very important to be able to predict the financial failures of firms. Several models have been developed in the literature to predict financial failure. Some of these models are based on accounting data and others are based on market data. Artificial neural networks play a significant role in financial failure prediction models. With this study, it is aimed to guide the researchers about the use of artificial neural networks as a financial failure prediction model.

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