Identifying Symptoms of Bankruptcy Risk Based on Bankruptcy Prediction Models—A Case Study of Poland

The article presents selected Polish early warning models (logit and discriminant models) that allow the assessment of the risk of bankruptcy of a company, and the purpose of the considerations is to indicate their prognostic effectiveness in predicting susceptible Polish companies one year before their declarations of bankruptcy. The limitations of these methods were also indicated in unpredictable situations, such as the outbreak of an economic crisis, e.g., caused by a humanitarian crisis—the COVID-19 pandemic. Another aim chosen in the article is a methodological critical assessment of the phenomenon of widespread use of foreign models (including the common Altman method) in the study of the risk of bankruptcy of Polish enterprises. Models developed on a sample of foreign enterprises without prior adaptation to domestic conditions are used all over the world, so the conclusions of the article are applicable internationally. The research was based on a query of Polish and foreign literature in the field of economic and legal aspects of bankruptcy and financial analysis, including, in particular, bankruptcy forecasting. The empirical research analyzes the financial data of 50 Polish enterprises from 2017 to 2018. The effectiveness of the selected bankruptcy forecasting models in identifying enterprises from section C of the Polish economy (industrial processing) that filed for bankruptcy in 2018 and 2019 was tested. The time frame fully allows for the identification and the assessment of the effectiveness of early warning models a year before bankruptcy.