Amount of loss that the insured must cover themselves before the insurance cover kicks in.
Failure to make required payments on time or that do not comply with conditions of an obligation.
Discretionary Credit Limit (DCL)
Company's right to obtain coverage for various customers without having prior approval from the insurance company. This consequently gives the insured a certain degree of independence.
Days Sales Outstanding (DSO)
A company's average collection period. Calculated as: (accounts receivables/total credit sales) x number of days
A low figure means the company collects its outstanding receivables quickly.This ratio is often used to help determine if a company is trying to disguise weak sales. Typically it is looked at either quarterly or yearly (90 or 365 days).