Is your business credit worthy? Will you be able to pay-up where obliged? Credit analysis performed in order to determine whether an organization is credit worthy. The analysis involves measuring debts and bonds in order to determine whether a company can repay them or if there is a likelihood of default.
Credit analysis techniques include: ratio and trend analysis, cash flow analysis and looking into the future through modelling and forecasting.
Banks often review credit before approving corporations for a loan, using an analysis of cash and the debt service coverage ratio in order to determine whether a suitable cushion exists.
The following analysis is required:
- KPIs by customer, company and/or consolidated level
- Cash in control
- Monthly differences
- Performance analysis of sales manager and credit managers
- Cash flows analysis