文档介绍：Credit Risk Management Enhancing Your Bottom Line
Ebrahim Shabudin
Managing Director
Deloitte & Touche LLP
The AFP 23rd Annual Conference
New Orleans
November 3-6, 2002
Credit Background
Thorough identification and accurate measurement of credit risk, supported by strong risk management can help improve the bottom line
…..An uncertain and volatile economic environment significantly impacts this ability
…..The desire to grow and turn in outstanding results has a tendency to put pressure on the checks and balances within businesses
Value Proposition
Credit plays a critical role in “selling” products and services
Expands revenue opportunities with creditworthy, incremental customers
Utilizes innovative structures to support business relationships
Effective credit risk management limits credit losses and provides stable cash flows and earnings
Marketplace panies exhibiting earnings and cash flow stability with higher P/E multiples
Marketplace penalizes credit induced volatility and “surprises”
Raises questions about quality of management
Corporate Credit Risk
Companies are exposed to significant levels of credit risk emanating from different sources
Accounts Receivables
Other Notes Receivables
Buyer and Franchise Financing
With Recourse Financing
Project Finance
Structured Transactions
Leases with Recourse
Derivatives Exposures
FX, Interest Rate Risk, Commodities etc.
Collateral Risk
Parent or Third Party Guarantees
Commercial and Standby Letters of Credit
Note also that Critical Suppliers to pany may pose specific credit risk
DSO Impact … an example
Actual
Company A
Peer Average
Q3 A/R
$295,396,000
Q3 Sales
$261,201,000
\ DSOs =
124*
Hypothetical
D Cash
DSOs
Q3 Sales
$261,201,000
\ Q3 A/R =
$122,002,230
+$173,393,770
* Equals x 90(or number of days in sales period)
Credit as a Facilitator
Credit risk management is important
Credit is a facilitator of business growth and performance
High business margins tend