Principal Component Analysis in Financial Data Science

Numerous methods exist aimed at examining patterns in structured and unstructured financial data. Applications of these methods include fraud detection, risk management, credit allocation, assessment of the risk of default, customer analytics, trading prediction, and many others, creating a broad field of research named Financial data science. A problem within the field that remains significantly under-researched, yet very important, is that of differentiating between the three major types of business activities—merchandising, manufacturing, and service based on the structured data available in financial reports. It can be argued that, due to the inherent idiosyncrasies of the three types of business activities, methods for assessment of the risk of default, methods for credit allocation, and methods for fraud detection would all see an improved performance if reliable information on the percentage of entities’ business activities allocated to the three major activities would be available. To this end, in this paper, we propose a clustering procedure that relies on Principal Component Analysis (PCA) for dimensionality reduction and feature selection. The procedure is presented using a large empirical data set comprising complete financial reports for various business entities operating in the Republic in Serbia, that pertain to the reporting period 2019

Succeeding in bioeconomy: Serbian universities' blueprint

The purpose of this paper is to provide insight into the level of integration of the bioeconomy concept in the study programmes and modules at Serbian higher education institutions. Bioeconomy is based on multidisciplinary approach, which consists of research, education and innovation. Bioeconomy must be initiated by the government, developed by research institutions, universities and cluster, and thoroughly implemented into existing and emerging industries. As educators, Serbian universities should play a key role in developing future professionals. Research has been conducted to determine if Serbian universities educate students in the fields relevant to the concept of bioeconomy. All accredited study programmes in academic year of 2017/2018, at all universities in the Republic of Serbia, have been analysed. The research included 17 universities, 152 departments, 481 study programmes, 705 modules and 43,360 courses. The modules within the study programmes were categorised as bioeconomy-based modules, nonbioeconomy-based modules with at least one bioeconomy-based course, and non-bioeconomy-based modules. The research shows that of the total number of modules, 43% include one or more bioeconomy-based courses. The share of such courses within modules ranges from 1% to 21% and differs among groups of scientific fields

Merenje konkurentnosti na tržištu industrije mesa - da li u Srbiji postoje oligopoli?

Production of meat and processing of meat products is a very significant part of the food industry. In order to secure economic growth and development, especially in the meat industry, it is very important to provide free competition for the business entities that operate within it. Therefore, the main purpose of this study was to measure market concentration using the Herfindahl-Hirschman Index (HHI), in order to determine the competition level in the Serbian market. Furthermore, the HHI should provide evidence of any business entities that hold monopolistic or oligopolistic positions on the market. Moreover, another aim of this study was to define to what extent business entities in the Serbian meat industry export products and goods to international markets. The 350 companies that reported the highest revenues during 2013-2017 and which are registered in this sector were studied.Proizvodnja mesa I mesnih prerađevina je veoma značajan deo prehrambene industrije. Da bi se postigao ekonomski rast I razvoj, posebno u mesnoj industriji, veoma je važno obezbediti slobodnu konkurenciju za privredna društva koji posluju u njoj. Stoga, glavni cilj ovog rada je da se, pomoću Herfindahl-Hirschman indeksa (HHI), izmeri koncentracija tržišta, kao I da se utvrdi nivo konkurencije na srpskom tržištu, ali I da se utvrdi da li postoje subjekti koji na tržištu imaju poziciju monopola ili oligopola. Drugi cilj ovog rada je da se definiše u kojoj meri poslovni subjekti iz srpske mesne industrije izvoze svoje proizvode I robu na međunarodnom tržištu I da li je nivo koncentracije isti. U istraživanju je korišćen uzorak od 350 privrednih društava registrovanih u ovom sektoru, a koja su obelodanila najviše prihode u izveštajnom periodu od 2013. do 2017. godine

Possible ramifications of introducing the institute of personal bankruptcy: The USA experience

In the past decade, the increase of household debt in Serbia as well as in the entire region has brought the issue of personal bankruptcy into the spotlight. The adoption of this procedure would enable individuals who are over-indebted and unable to settle out the credit and current payables to file for personal bankruptcy. The main objective of this procedure would be to ensure the maximum reimbursement of creditors' claims from the debtor's available assets and annual revenues. Such a procedure would also provide for the protection of the debtor's basic human rights and dignity. In order to provide a fresh start for the debtor and his financial standing, bankruptcy proceedings commonly include debt write-offs, to some extent. Obviously, personal bankruptcy has two sets of goals, which are mutually inconsistent, contradictory and often incompatible. In order to prevent possible abuses, bankruptcy reasons must be clearly defined and set out in more rigorous terms. This paper analyzes the impact of personal bankruptcy in generating the global economic crisis and the repercussion that personal bankruptcy has had on the global economy. The increase in the number of bankruptcy proceedings filed in the USA in 2005 was a warning about the forthcoming events. Mortgage loans were the major reason for filing a large number of personal bankruptcy claims. In fact, until 2006 the US real estate market had been booming but no one could have guessed then that the real estate values would fall sharply in the years to come. Credit deregulation caused higher demand for mortgage backed loans and the nation's household debt increased significantly. However, the negative selection of debtors, their insolvency and irregular payment of annuities caused turmoil, which generated major problems for financial institutions. At the end of2007, nearly 16 percent of all mortgage loans were uncollectible in full. The analysis of events that led to the onset of the global economic crisis and the role of personal bankruptcy as its most probable cause yields a conclusion that the adequate legal regulation of this process is paramount. The experiences of countries that have already introduced this legal institute are invaluable. The countries in the region which have set too rigorous rules for debt write-offs are currently facing the option of undertaking massive write-offs of debtors' claims, which are most unlikely to be objective. On the other hand, in the countries which have envisaged too flexible proceedings for debt write-offs, there is a negative selection of debtors and default of financial institutions. With this experience in mind, it is necessary to regulate and apply the institute of personal bankruptcy so that it provides for the maximum debt collection as well as for accomplishing the major social goals

Ekonomija Republike Srpske u globalnim ekonomskim procesima: nužnost ili izbor

Informatička ekonomija je relativno novi pojam i pojava koja je nastala 90-tih godina prošlog veka, ali koja je unela mnoge promene u ekonomske procese, posebno na globalnom nivou. Ovaj rad prezentuje pre svega novi termin koji se pojavio u kontekstu globalne i informatičke ekonomije a to je nova ekonomija. Ovaj termin je već postao opšteprihvaćeni termin u terminologiji izučavanja novih globalnih procesa u ekonomiji koji su bazirani na informatičkoj ekonomiji. Sadržaj termina nove ekonomije određuje one elemente i faktora uticaja na brži ekonomski razvoj na novim osnovama koji za sada pokazuje pun uspeh u zemljama razvijenih ekonomija. Međutim i zemlje ekonomija u razvoju takođe imaju svoju šansu da se u kontekstu novih promena prilagode novinama i na taj način na brži način dostignu viši stepen razvoja ekonomije što bi bio slučaj i sa ekonomijom Republike Srpske

Credit risk analysis of Serbian luxury hotels: Impact of COVID-19

The aim of this research is to analyse credit risk levels of Serbian luxury hotels, before, and during the COVID-19 pandemic. The purpose is to highlight the need for state-supported measures and proactive strategies to ensure financial sustainability and resilience in the luxury hotel industry. A dataset of 192 observations from 2019 to 2021 is employed, using predictive models including the Altman Z'-score, Altman Z''-score, Kralicek DF score, Springate S-score, and Zmijewski X-score, to assess creditworthiness of 64 selected mostly 4-star hotels. Data analysis involved the use of statistical tests such as the Kolmogorov-Smirnov test, Shapiro-Wilk test, and Wilcoxon signed-rank test. All models, except Zmijewski, show statistically significant results. The findings reveal a significant impact of the pandemic on credit risk levels in 2020, followed by positive trends in 2021, indicating successful adaptation and resilience. Policymakers, financial institutions, and hoteliers can use these insights to navigate the post-pandemic era effectively

Strategije finansiranja razvojnih projekata jedinica lokalne samouprave grada Bijeljina

Cilj rada je bio utvrđivanje strukture finansiranjarazvojnih projekata jedinice lokalne samouprave grada Bijeljina.Razvoj jedinice lokalne samouprave sprovodi se uz pomoć planaimplementacije strategija razvoja koje se postavljaju za određenivremenski period. Najznačajniji instrument za finansiranjelokalnog razvoja, implementaciju i upravljanje razvojnimprojektima predstavlja finansijski plan. U okviru njega definišuse, pored budžetskih sredstava i drugi oblici izvora finansiranja.S obzirom na to da budžetska sredstva često nisu dovoljna zafinansiranje plana strategije razvoja jedinica lokalnesamouprave, neophodno je obezbediti sredstva putemzaduživanja, donacija, fondova, javno – privatnog partnerstva idrugih. Rezultati istraživanja pokazali su da se razvojni projektiu gradu Bijeljina najvećim delom finansiraju iz ostalih izvoru(85%), dok se iz budžeta jedinica lokalne samouprave izdvajasvega 15% za finansiranje planiranih razvojnih projekata

Non-disclosure of financial statements of public companies as an economic offense in the Republic of Serbia

The successful functioning and development of the capital market, along with the possibility of attracting new investments is largely contingent on the quality of financial reporting and the availability of the statements themselves. In view of the fact that the new Law on Accounting of the Republic of Serbia came into force, the question arises to what extent public companies respect legally prescribed deadlines for submitting their statements and by doing so do not commit an economic offense. The primary goal of this paper is to draw attention to the importance of a standardized and efficient legal framework that obliges public companies to publish financial statements in a timely manner. A survey was conducted that encompassed 416 public companies listed on the Belgrade Stock Exchange and their corresponding financial statements for 2018, as the reporting period. We tried to establish whether the sampled companies disclosed their statements within the deadline prescribed by the Law on Accounting (Law on Accounting, Official Gazette of RS, 62/2013, 30/2018). The results show that most companies disclosed financial statements during the period when they are still considered useful to potential and existing investors. Nevertheless, practice showed that there was room for improvement, and this was achieved with the adoption of the new Law on Accounting, which took effect on January 1, 2020. It integrates the deadline for compiling and disclosing statements, which in fact shortens the time period during which information on the companies' operations should be made available to the general public and potential investors