PREDICTING CORPORATE FAILURE IN NIGERIA: A CASE FOR CADBURY NIGERIA PLC.

The main thrust of this paper is to use several corporate failure (bankruptcy) prediction models to test the ability and accuracy of the models to verify if the firm will fail shortly. Using a case study of a publicly quoted manufacturing firm (Cadbury Nigeria PLC) from the Nigerien Stock Exchange with data from 2011 to 2018.The four corporate failure prediction models tested were the Altman-Z, Almamy-Z, Taffler-Z, and Ohlson-Z scores. The Multiple Linear Discriminant Analysis (DLMA), the Logistic Regression Analysis were used to justify each of the model's claim of their power of prediction and hence finding which of the model is more accurate and germane to predict corporate failure in Nigeria. The study's findings were that all four models predicted no failure (bankruptcy) for Cadbury Nigeria PLC shortly. Further findings were that Altman Z topped in the ranking of predictive power amongst the other models z scores. Additionally, from the result of the study, fourteen (14) potent variables from the models tested were negative thus having the ability to predicting corporate failure. The other variables that are not too significant in predicting the firm's failure were the ratios of working capital-to-total assets, revenue-to-total assets, retained earnings-to-total assets, current assets-to-current liabilities, current liabilities-to-total assets, and log of total assets-to-GDP price level index. The potent variables can be re-estimated and used for further studies as a new corporate failure model in the manufacturing industries.