Benefits of accessing conventional financing

Analyzing the benefits, as well as the sustainability and quality of accessing conventional financing, is part of an assessment of management or excessive credit risk, since a high market risk may affect its volatility. Quality is lower if it relies on extraordinary profits or one-off events or favorable taxation.

The trend may be affected by difficulty in obtaining financing, uncontrolled operating expenses, poor strategy or poor management of exposure to other risks.

The current liquidity position and its future sources are analyzed in comparison with its needs, as well as management's ability and capacity to react to unexpected changes in funding sources or market conditions that require a rapid liquidation of assets, so that costs are kept to a minimum.

In the same way, care is taken to ensure that liquidity is not maintained at excessive cost or that it does not rely on financing that is difficult to obtain in times of financial crisis or adverse market conditions.

This analyzes the degree to which changes in interest rates, exchange rates, commodity prices and stock prices can affect the profits or capital of entities.