Bancruptcy Prediction in The Indonesia Sharia Stock Index Coal Mining: Altman Z-Score vs Zmijewski X-Score

Trisya Qurota A'yun; Clarashinta Canggih

doi:10.55980/ebasr.v5i2.410

Authors

Trisya Qurota A'yun Department of Islamic Economics, Universitas Negeri Surabaya, Surabaya, Indonesia
Clarashinta Canggih Department of Islamic Economics, Universitas Negeri Surabaya, Surabaya, Indonesia

DOI:

https://doi.org/10.55980/ebasr.v5i2.410

Keywords:

Altman Z-Score, Bankruptcy Prediction, Financial Distress, Indonesia Sharia Stock Index, Zmijewski X-Score

Abstract

Global economic uncertainty, coal price volatility, and energy transition pressures have increased the risk of financial distress among coal mining companies in Indonesia. This study aims to analyze and compare the Altman Z-Score and Zmijewski X-Score methods in predicting bankruptcy among coal mining companies listed on the Indonesia Sharia Stock Index (ISSI) during the 2015–2024 period. This research employs a quantitative approach with a comparative method. The data consist of annual financial statements from 10 companies over 10 years, resulting in 100 observations. The analysis was conducted by calculating bankruptcy scores using both models and evaluating their accuracy, Type I Error, Type II Error, and model consistency through K-Fold Cross Validation. The results show that the Altman Z-Score method achieved an accuracy rate of 94.74%, with a Type II Error of 4.49% and a Type I Error of 16.67%. The Zmijewski X-Score method demonstrated a slightly higher accuracy of 94.85%, with a Type II Error of 4.40% and a Type I Error of 16.67%. Although the accuracy difference is marginal, the Zmijewski X-Score appears more stable, while the Altman Z-Score is more sensitive to changes in companies' financial conditions. Overall, both methods are appropriate for predicting bankruptcy in coal mining companies listed on ISSI; however, their application should be complemented by additional financial analyses to minimize misclassification risk.

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