The Canadian Public Accountability Board (CPAB) has subscribed to the Kamakura Risk Information Services (KRIS) default probability service.
CPAB is mandated to promote the integrity of public company auditing in Canada. CPAB intends to use the KRIS default probabilities as early warning indicators of situations where increased scrutiny of an audit may be warranted.
“Kamakura’s KRIS default probabilities use accounting ratios, macro-economic factors, and stock price-related inputs to predict corporate bankruptcies and other corporate failures. The overall balance of these three inputs predicts corporate distress at all time horizons tested more accurately than major rating agency ratings. We are honoured that CPAB-CCRC will incorporate the KRIS default probabilities as part of its audit monitoring process,” says Warren Sherman, president and COO, Kamakura.