THE USE OF QUALITATIVE VARIABLES IN THE RISK ASSESSMENT

In recent decades, the importance of qualitative variables in the assessment of the company’s risk has grown considerably, due to the growing importance of intangible assets. Currently, it is believed that the intangible assets are even more important than the tangible assets. The measurement of intangibles and their inclusion in the risk analysis became therefore mandatory. The financial ratios which were traditionally used to point out the financial distress are no longer sufficient. As a result, the classical score functions had to be adapted which led to other difficulties, related to the evaluation of intellectual capital. This paper presents the general considerations regarding the use of qualitative variables in the risk analysis and the global concerns in this respect. It is also presented a model of bankruptcy risk analysis based exclusively on qualitative variables.