Analysis of Bunkruptcy Prediction With Altman Z-Score , Springate and Zmijewski Models Based Engineering Science ( Case study at Garuda Indonesia Airline , Period Years of 2014-2017 )

The purpose of this reseach is to analysis and to make a bunkruptcy prediction of the Garuda Indonesia listed on Indonesian Stock Exchange,and to find out what the best model used in a bunkruptcy prediction of company. Reseach method based on purposive sampling.The population of this reseach is a numbers of company financial reporting listed on Indonesian Stock Exchange, and the sample obtained from period years of 2014 to 2017. The analysis of technical data used is descriptive analysis with a helping microsoft excel software . The reseach finding, that based on Altman Z-Score, and Springate prediction model based engineering science, Company have experienced a potency of bunkruptcy since 2014 till 2017. Meanwhile Zmijewski prediction model based engineering science company has experienced a potency of bunkruptcy in 2014 and 2017. whrereas in 2015 and 2016, company is classificated as a healthy company. Based on result of the third models analysis mentioned, Zmijewski model is a better in bunkruptcy prediction of company.


Literature Review Bankruptcy
The bankruptcy is a condition when the company has insufficient funds to run its business or failure of the company in running its operations to generate profit. Venkataramana et al. (2012) states that Bankruptcy is a situation where liabilities exceeds assets in a company, it generally occurs due to lack of capital, has no sufficient cash, the sources have properly not utilized , The management activities are inefficient, sales growth is declining, and the market situation deteriorates. Furthermore, Onakoya & Olotu (2017) stated that bankruptcy is, when a company has no capablities to earn sufficient revenue to cover its costs, in this case, such a company has a negative economic value. Drescher (2014: 25), said that financial distress is the final stage of a liquidity crisis and potentially included in the bankruptcy stage. According to Musthafa (2017: 202), financial difficulty is a condition in which a company is unable to meet its financial obligations, both short and long term Setiadi (2011) identified factors that make a bankruptcy of company can be classificated into two factors, namely: Internal factors, where management has no capabilities to run its business efficiently and can not fulfil their obligations, there is an inefficiency and imbalance amount of capital owned to cover total debts recently, and with the amount of debt will reduce a company profits. Fraud of management will also create a bankruptcy of company. External factors, alteration in customer demand that should be fulfilled by company, the suppliers who cannot meet raw material standard, excessive of receivables inventory, have a poor relationships with debtors, strict of business competition and global economic conditions that must be a consideration.
There are several tools used to predict the bankruptcy of a company. The bankruptcy predictors resulting from various studies conducted by experts who focus on bankruptcy at various companies in the world, there are at least three (3) models that can be used to predict bankruptcy and consist of Alman Z-Score, Springate, Zmijewski Model, Subrahmanyan, et.al (2010).

The Altman Model ( Z-Score)
The first bankruptcy prediction model based engineering science was introduced by Altman (1968), known as Almant Z-Score. This model has been widely used and still being relevant to predict a company whether it is bankrupt, in grey area or healthy, Altman, et al,(2017). In 1995, Edward Almant later modified the model, so that it can be used for predicting bankruptcy of manufacturing and non-manufacturing companies.
The modification of Altman Z-Score completely removes X5 variablel (Sales to Total Assets), because this ratio has many variation and asset size among industries. The following Z-Score equation showed after modification.

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 If value of Springate > 0,862, is classificated as a healthy company.  If value of Springate < 0,862, is classificated as a bankruptcy company.

The Zmijewski Model (X-Score)
In 1983 Zmijewski used an analysis rasio of liquidity, leverage and measure a company performance. Zmijewski made prediction with a sample of 75 companies bankruptcy, and 73 companies were healthy as long as years of 1972 -1978,by using Indickators F-Test rasio group of rate of return, liquidity, return on return, fixed payment coverage, trends, firm size, and stock return volatility, show some significant distinction between a healthy and poor company. The model which is developed, as follow: X = -4,3 -4,5X1 + 5,7X2 + 0,004X3 Where: X1 : Earning After Tax to Total Assets X2 : Total Debt to Total Assets X3 : Current Assets to Current Liabilities Cut-off which is used in this model, namely 0 (zero),where  if X has a positive value, it means that the company has a bankruptcy potential, whereas  if X has more negative value, it means that the company is away from bankruptcy.

Framework
Based on description above, The framework could be described as showed on picture.1 below

Reseach Methodology Sample and Data.
The population in this reseach are all financial report of Garuda Indonesia listed on Indonesian Stock Exchanged. The sample method used is a purposive sampling, so, the numbers of sample was taken in this research was a financial reporting of Garuda Indonesia Airline for period years of 2014 to 2017.

Method of Analysis
The Method of analysis used in this research is a descriptive analysis with a helping of software microssoft exel. The Technic of data analysis used are three models of bankruptcy prediction, namely Altman Z-Score, Springate, dan Zmijewski models

Results and Discussion
The result of all financial aspect assessment of Garuda Indonesia Airline for period years of 2014-2017, showed on tabel 1.

Return On Equity (ROE)
As showed on table 1 above, ROE of Garuda Indonesia had a -41,15% value in 2014 and a -23,85% value in 2017 with score value was zero (0) respectively, it proved that company performance was at the worst condition. Moreover company had a 8,35% value in 2015 with score value was 12, and had a 0,94% value in 2016, with score value was 2, it showed that tne company performance was fairly well in acquiring profit but the company experienced a profit declining as many 7,41%.

Return On Investment (ROI).
As showed on table 1 above, ROI of Garuda Indonesia had a 21,51% value in 2014 and a 40,05% value in 2015 with score value was 15 respectively, it proved that company performance was a very healthy condition. But in 2016 and 2017, Company conversely experienced a declining of ROI drastically with value was -1,53% and -6,15% and have a 1 score respectively.It showed that the ROI of company was in the worst condition.

Cash Ratio
As showed on table 1 above, cash rasio of Garuda Indonesia, had an average of 38.70 % value since 2014 till 2016 with score 5 respectively, it means that Company had a capability to run its business operation including pay for short -term debt.Meanwhile in 2017, Company conversely experienced a declining of cash rasio up to reach 15,97% with score value 3. It proved that company was initiating to have a financial distress to run its business and pay for short -term debt.

Current Ratio
As showed on table 1 above, Garuda Indonesia experienced a fluctuation value of current ratio where company acquired 66,47% in 2014, 84,28%, in 2015, 74,52% in 2016,and 51,34% in tahun 2017, cause of current ratio results were smaller than 90 % , so the score value were 0 (zero) respectively. It means that the last position of company current asset was smaller than the last of its current liabilities.

Collection Periods (CP)
As showed on table 1 above, the collection periods of Garuda Indonesia was tend to decline every years, where CP received for 11,19 days during 2014, 11,63 days during 2015, 18,07 days during 2016 and CP received for 20,03 during 2017, with all score value were 5 respectively. Eventhough, Company had a succesfully to discharge some claims on time, so that the company was still able to run its business. Inventory Turnover.
As showed on table 1 above, the average of inventory turnover of Garuda Indonesia was 9.61days per year during years of 2014 -2017,with score value was 5 resectively. Despite of company inventory turnover seems to be late, but the score value was high, it shows that the company operation activities was good to delivery revenue.

Total Asset Turn Over (TATO)
As showed on table 1 above, the TATO of Garuda Indonesia had a significat value with the avarage of tato was 114,5% per year during years of 2014 -2017, and with average of score value was 4,5. It means that the company had still capabilities to run its business optimally Capital Total to Asset Total (CT to AT) As showed on table 1 above, the rasio of capital total to asset total of Garuda Indonesia experienced a fluctuation value, where result of CT to AT rasio was -10,77%, and the score was 0 (zero) in 2014, and 2,15% wih score was 4 in 2015, and 1,58 % ,with score value was 4,in 2016, and -4,13 % with score was 0 (zero) in

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2017. All these mean that the company had no capabilities to reached maximum score (100%) as prescripted by goverment (ministry of Indonesian state owned enterprises). And Company was in capital distress or used a bigger asset in operational. The smaller of rasio results proved that company used some debts money to fare its assets.

Discussion of Researh Result of Bankruptcy Prediction Using Altman Z-Score, Springate and Zmijewski Models Based Engineering Science
The Altman Z-Score Model Based on reseach result at Garuda Indonesia and also refered to the Altman Z-Score certainty, concerning with a bankruptcy prediction,as follow : if Z > 2,60 , so the company was in a good condition, if 1,1 < Z < 2,60 , so the company was in a grey areas, moreover if Z < 1,1, so the company was in a bad condition, or was in bankruptcy potential, as showed at tabel.5. Based on datas mentioned above could be interpretated, as :

Tabel 5 Classification Result of Altman Z-Score Models on Garuda Indonesia
The result of processing by using Altman Z-Score on Garuda Indonesia provided a bankruptcy potential during years of 2014 to 2017. The Z-Score value was in fluctuation and financial position was in distress condition.All these were attributable,as : (X1) Working capital rasio was negative value cause of current liabilibies > current asset, (X2) Retained Earning rasio was negative value , (X3) EBIT provided a low value and ( X4) book liabilities value > capital market value.

The Springate Model
Based on reseach at Garuda Indonesia and also refered to Springate certainty,with cut-off, if S-Score > 0,862,so is classificated as a healthy company and if S-Score <0,862,so is classificated as a bankruptcy company. Based on datas mentioned above could be interpretated, as :

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The result of processing by using S-Score on Garuda Indonesia provided a bankruptcy potential during years of 2014-2017. The S-Score value was in fluctuation and financial position was in distress condition. All these were result from: (X1) Working capital rasio was negative value cause of current liabilibies > current asset, (X2) EBIT provided a low value, (X3) current liabilibies was higher than EBIT and ( X4) sales experienced a fluctuation during years of 2014-2017

The Zmijewski Model
Based on reseach at Garuda Indonesia and refered to the Zmijewski determinate, with cut-off, if X-Score > 0, so is classificated as a bankruptcy potential company and if X-Score < 0, so is classificated as a healthy company. The result of processing on company during years of 2014 -2017 showed at tabel 7 Tabel  Based on datas mentioned above could be interpretated, as : The result of processing by using X-Score on Garuda Indonesia provided a fluctuation condition during years of 2014-2017, where company experienced a bankruptcy potential in 2014 and2017, it caused of (X1) Net profit margin rasio was negative value,so the company experienced a disadvantage or loss of profit, moreover company showed a good condition in 2015 and 2016.

Conclusion
Based on result of reseach executed by using financial analysis rasio and analysis of Altman Z-Score, Springate and Zmijewski models could be concluded, as follow : Financial performance analysis rasio, Garuda Indonesia had experienced a fluctuation condition since 2014 till 2017, where company financial performance was in unhelathy classification,with score value was 50 % in 2014 and 35 % in 2016 and 26,46 % in 2017, but company financial performance was in good condition in 2015, with score value was 72,14%.
The result analysis of Altman Z-Score and Springate models proved that Garuda Indonesia had experienced a bankruptcy potential since 2014 till 2017, Meanwhile Zmijewski model showed that the company was in a healthy condition in 2015 and 2016. Based on clasification level of using three models to make a bankruptcy prediction of the company, Zmijewski model has a more accuration in bankruptcy prediction of the company than others one. The reason was reinforced by some researchers who had given an evidence of using Zmijewski model, as Fadrul  This reseach has a limitation, where scope of research focused just on Garuda Indonesia only. Furthermore research, we recommendate to compare with others airline, such as : Air Asia, Sriwijaya, Lion Air, Citilink,and Batik Air Airline,etc.