Online Program

Liability Survival Analysis (303025)

Keywords: survival analysis, finance, liability

Outstanding liabilities can pose significant challenges for large organizations with numerous small liabilities such as gift cards or prepaid services. Understanding this liability is critical for financial planning, regulatory compliance, and accounting. In this presentation, we will analyze simulated data and discuss a variety of modeling approaches to estimate the real liability incurred by these services. We will cover approaches such as the Cox proportional hazard model, accelerated failure time models, and constant rate assumptions. These insights will offer participants an understanding of an organization’s liability and allow for better informed financial planning when the appropriate model is applied. For each approach, we will discuss the relevant theoretical and statistical issues to consider, as well as practical concerns when implementing models and communicating the results. We will consider the situations suited for each approach, the data characteristics required to support the various models, and pitfalls inherent in each approach.