We work with financial stakeholders to conduct a review of the liquidity and related cash flow forecasts of borrowers to understand and analyse drivers of cash flow. For example, trading performance, working capital, restructuring costs or provision payments. This work requires us to assess amongst others, intra month peak requirements, vulnerabilities and potential upsides. This provides lenders with an independent view on whether its borrower has adequate liquidity to continue operating normally, thereby allowing time for the lenders to consider their options.
We conduct high level ‘stress tests’ and analysis of the borrower’s business plan. We can help lenders take a view as to whether the business plan provides a reasonable basis to determine the debt capacity and to make future lending decisions, by taking the following steps: