The new preventive alert mechanism in Italian crisis code: a statistical approach for predictive insolvent analysis

This paper analyses the 2020 financial statements of the SMEs in Brescia with the failure companies list of the Court of Law of Brescia and the inactive or ceased companies by the Brescia’s Chamber of Commerce. None of the companies in the sample failed in 2020, 2021 and 2022: this point is not enough to declare that indicators are not the right tools to predict the crisis state for the Italian SMEs. Data also show a correlation between the presence of out of range indicators and ceased or inactive companies. These indicators seem not to be the best tools to predict the companies’ failure, especially for the SMEs with the Italian simplified balance sheets, but in our opinion and by analyzing data, these are a step forward for the introduction of prediction analysis and for business management.