LSE Recommendation Letter Example: Insolvency officer to financial distress policy (Score 92)

Department of Accounting and Finance [University Name] [Date] To the Admissions Committee MSc Economics and Finance London School of Economics and Political Science I am writing in support of the applicant's application to the MSc Economics and Finance at LSE. I supervised the applicant's undergraduate dissertation over approximately nine months, and that sustained contact gives me a reasonably clear picture of their analytical capabilities and intellectual habits — the kind of picture that a single module grade cannot provide. I should say at the outset how the applicant came to work with me. They approached me after completing a module on corporate financial distress, asking whether a dissertation examining the policy implications of insolvency administration would fall within my supervision area. The question itself was a signal: most students at that stage are looking for a topic that fits a template; this applicant was trying to connect practitioner experience — they had worked in an insolvency administration role — to a research question with genuine policy stakes. We agreed on a project examining how financial distress indicators used in insolvency practice compare with the predictive frameworks in the academic literature, and what that gap implies for regulatory design. The first scene I want to describe is from an early supervision meeting, roughly six weeks into the project. The applicant had drafted a literature section that was competent but essentially descriptive — a survey of Altman-style models and their successors, with limited critical engagement. I pushed back on this directly: I asked them to identify where the practitioner indicators they knew from their insolvency work diverged from the academic models, and to explain why that divergence might matter for a policymaker rather than a creditor. What happened over the following two weeks was instructive. The applicant returned not with a tidied-up version of the same section but with a restructured argument — one that used their own field observations as a lens for evaluating the models rather than treating the models as given. That shift, from summarising to interrogating, is not something I can teach in a single session; the applicant had to do the intellectual work themselves, and they did. The second scene is from the final submission period. The applicant had constructed a policy memo as a standalone output alongside the dissertation — a document addressed to a notional regulatory audience, translating the dissertation's findings into actionable recommendations on early-warning disclosure requirements for distressed firms. I reviewed two drafts of this memo. The first was technically sound but written in academic register, which undermined its purpose. The second draft showed a clear adjustment: the applicant had tightened the causal logic, removed hedging that would read as evasion to a policy reader, and structured the recommendations around decision points rather than research conclusions. The ability to reframe the same analysis for a different audience, without losing analytical rigour, is a skill that matters considerably in economics and finance at postgraduate level, and it is not universal among strong undergraduates. I want to be honest about one limitation. The applicant's quantitative methods work in the dissertation was adequate and purposeful, but it was not the most technically ambitious component of the project. They used established distress-prediction models and applied them carefully to a selected dataset; they did not extend or stress-test the models in ways that would have required more advanced econometric technique. This is partly a function of the dissertation scope we agreed, and it does not concern me greatly given the BSc context. But it does mean that the applicant will need to invest seriously in the quantitative and econometric modules at LSE, and I would expect them to do so — their response to methodological challenge during supervision was consistently constructive rather than avoidant. For the MSc Economics and Finance specifically, I think the applicant brings something that is genuinely useful and not always present: a grounded understanding of how financial distress manifests in practice, combined with the intellectual discipline to ask what the theory does and does not explain. That combination is a reasonable foundation for the programme's demands, provided the applicant commits to closing the methods gap I have described. I am happy to discuss this assessment further if it would be helpful to the committee. Yours sincerely, the applicant Associate Professor of Economics and Finance [University]