Proceedings of the 2nd International Seminar on Science and Technology (ISSTEC 2019)

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Building an Initiation of Financial Reporting System Using Blockchain and Classification Analysis to Financial Distress

Authors
Arum Handini Primandari, Masthura
Corresponding Author
Arum Handini Primandari
Available Online 11 October 2020.
DOI
10.2991/assehr.k.201010.028How to use a DOI?
Keywords
Blockchain, Financial Distress, Financial Reporting System, SMOTE, SVM
Abstract

Indonesia’s regional government still uses a conventional financial reporting method by manually submitting some documents. As a consequence, there is no digital database provided. Our proposed technology is blockchain to be implemented for distributed tech financial reports. As popular as a cryptocurrency database system, Blockchain is a time-stamped series of immutable data records in chained blocks. As all the involved institutions (i.e., SKPD, PPKD, Regional Secretary, Regent/Mayor, BPK, and DPRD) will become nodes on the financial report system, its transparency and confidentiality are maintained. This research builds an initiation of the system using python programming. Adding the information about the regional financial condition, whether it experiences financial distress, or not will give the report overview. The prediction of financial distress is made by employing Support Vector Machine (SVM) with Radial Basis Function (RBF). In order to overcome the imbalance class, the Synthetic Minority Over-Sampling Technique (SMOTE) is applied. As a result, SVM with SMOTE can classify financial distress with the accuracy of the testing dataset is about 94.44%, the precision of 100%, and the kappa value of 82.34%.

Copyright
© 2020, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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Volume Title
Proceedings of the 2nd International Seminar on Science and Technology (ISSTEC 2019)
Series
Advances in Social Science, Education and Humanities Research
Publication Date
11 October 2020
ISBN
10.2991/assehr.k.201010.028
ISSN
2352-5398
DOI
10.2991/assehr.k.201010.028How to use a DOI?
Copyright
© 2020, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Cite this article

risenwbib
TY  - CONF
AU  - Arum Handini Primandari
AU  - Masthura
PY  - 2020
DA  - 2020/10/11
TI  - Building an Initiation of Financial Reporting System Using Blockchain and Classification Analysis to Financial Distress
BT  - Proceedings of the 2nd International Seminar on Science and Technology (ISSTEC 2019)
PB  - Atlantis Press
SP  - 193
EP  - 199
SN  - 2352-5398
UR  - https://doi.org/10.2991/assehr.k.201010.028
DO  - 10.2991/assehr.k.201010.028
ID  - Primandari2020
ER  -