Module: General Practice
Q107: Which of the following factors is NOT typically considered a "Financial Risk" parameter in a standard SME Credit Scoring Model?
✅ Correct Answer: C
A Management Succession Plan is a Qualitative (or Management) Risk factor, not a Financial one.
It relates to the continuity of leadership and business stability, which cannot be calculated directly from a balance sheet.
Financial Risks (Quantitative) include DSCR (which measures the ability to service debt), Current Ratio (which measures short-term liquidity), and Debt-Equity Ratio (which measures leverage).
It relates to the continuity of leadership and business stability, which cannot be calculated directly from a balance sheet.
Financial Risks (Quantitative) include DSCR (which measures the ability to service debt), Current Ratio (which measures short-term liquidity), and Debt-Equity Ratio (which measures leverage).