In the financial industry, companies are assessed and categorised by means of ratings. Particularly in terms of bonds, the given rating is an important source of information for investors.
In the determination of a rating, the following factors are taken into account on the basis of the companys balance sheet, income statement, annual reports and media releases:
- quantitative factors such as: economic circumstances such as financial status and profitability, balance sheet trends and vulnerability to various risks.
- qualitative factorssuch as management quality, corporate strategy, employee potential, organisation, controlling and risk management
- There are also experience-based and business-environment factors involved, such as: upholding contractual agreements, the timely payment of interest, overall developments in the given industry, location-specific developments, comparisons with competitors, as well as supplier and customer relationships.