Introduction. 1. Concepts of Financial Distress. 2. Theory of the Use of Financial Statement Ratios to Assess Financial Distress. 3. A Brief History of the Literature on Financial Ratios as Predictors of Distress. 4. The Use of Market Value-Based Prediction Models. 5. Modeling the probability of bankruptcy. 6. Key Empirical Results for the Prediction of Bankruptcy. 7. Bond Ratings, Financial Ratios and Financial Distress. 8. Suggested Directions for Future Research. 9. Concluding Remarks. References.
