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Credit Risk Management

Credit management or credit risk management is usually the area responsible for managing the credit and collections function of a company. This area of CreditPulse will feature articles related to credit risk management both on the micro and macro level.

Recent Articles

Why DSO Benchmarks and Benchmarking are Still Important

August 24, 2011

With companies becoming ever more agressive in recognizing revenue, widening credit terms and selling globally, the calculation for determining when they get paid -- days sales outstanding (DSO) -- has never been more important.  "Not a sign of strength."

Faro Technologies, Inc. is a $190 million scientific and technical instruments manufacturer based in Lake Mary, Florida, a suburb of Orlando.  The company manufactures and markets software-based three dimensional measurement and imaging systems for manufacturing, industrial, building construction and

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Biofuel Start-Up Shows Risks of Development Companies

July 12, 2011

Biofuel company PetroAlgae has no sales revenue yet has a market cap of over $1.5 billion, a dichotomy that illustrates the strange nature of hedge fund financing and the credit risks associated with development firms.

According to most press reports, the initial public offering (IPO) for PetroAlgae, based in Melbourne, Florida, occurred in August of 2010, but a closer look reveals that the company was publicly-traded long before that in a previous life that extends all the way back to 1988 and as far away as California.  Read more about PetroAlgae in this exclusive article.

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Air France Crash Brings to Light Automation Limitations

June 5, 2011

In recent years, many in the credit profession have turned to automation as a way of reducing DSO and bad debt.  The causes of Air France Flight 447 illustrate the dangers of an over-reliance on automation.

Technological advances over the years have enabled many operation and control-oriented processes, once handled soley by human hand, to become automated almost to the point where any manual involvement is looked upon as a deficiency.  Design the process, so the thinking goes, automate it and then sit back and let technology do the work.

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How Creditworthy Is IndiGo?

May 2, 2011

Closely-held Indian airline IndiGo is known for making big announcements about its fast-paced growth and plans for future growth but discloses very little about its finances and funding.  "Even when they are late they say they are on time."

Earlier this year, amidst much fanfare, Airbus announced that Indian budget carrier IndiGo had placed an order for 180 of its new version single-aisle A320 airliners valued at a whopping $15.6 billion.  Read below as CreditPulse analyzes the challenges that IndiGo poses to potential creditors.

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