Euler Hermes: Information and grading requirement

Question 1

Buyer sensitivity matrix

Answer 1

combination of grade and exposure

Question 2

MGA

Answer 2

Manual Grade Assessment

Question 3

MGA Sub Grade 1

Answer 3

Ownership, Management and strategy

Question 4

MGA Sub Grade 1 Details

Answer 4

1. Shareholders’ profile 2. Management profile 3. Corporate Strategy 4. Corporate Governance

Question 5

Shareholders’ profile

Answer 5

Structure and stability, financial capacity and level of support

Question 6

Management profile

Answer 6

Structure, stability, succession plan, quality, experience and track record

Question 7

Corporate strategy

Answer 7

Corporate vision, objectives and goals, business, marketing, financial and organizational strategies

Question 8

MGA Sub Grade 2

Answer 8

Revenue and profitability

Question 9

MGA Sub Grade 2 Details

Answer 9

Earnings Analysis. e.g. Revenue, costs and expenses etc.

Question 10

MGA Sub Grade 3

Answer 10

Liquidity and Financial Leverage. Identify source of financing and ability to meet short term financial obligation

Question 11

Liquidity profile

Answer 11

Cash position, short-term bank facilities, factoring facilities, access to financials etc.

Question 12

Capital structure

Answer 12

Medium and long term financing. include shareholders’ equity, tangible net worth, medium and long-term debt, LT solvency ratios etc.

Question 13

MGA Sub Grade 4

Answer 13

Cash flow and coverage

Question 14

MGA Sub Grade 4 Details

Answer 14

Cash flow generation capacity, debt service capacity, investment capability

Question 15

Cash flow generation capacity

Answer 15

net cash provided by operating, investing and financing activities, generation and use of free cash flow, cash flow ratios

Question 16

Debt service capcity

Answer 16

debt service requirements and coverage, interest coverage

Question 17

Investment capability

Answer 17

Capital expenditures needs and coverage