Scores and Ratings FAQs:
What is the Failure Score?
The D&B UK Failure Score predicts the likelihood that a company will obtain legal relief from its creditors or cease operations over the next 12 month period. The Failure Scorecard looks for the onset of failure such as Meeting of Creditors, Administrator Appointed, Bankruptcy, Receiver Appointed and Petition for Winding-up among other legal events. It is presented in the Business Information Report as a ranking score ranging from 1-100: 1 indicates the highest risk of failure and 100 the lowest level of risk. Each percentile represents 1% of the UK business universe. Businesses with the same Failure Score have the same risk of failure.
What is the Delinquency Score?
The D&B UK Delinquency Score predicts the likelihood that a company will pay its bills in a severely delinquent manner over the next 12 months.
How are the Failure and Delinquency Scores calculated?
The Failure Score and the Delinquency Score are calculated using a wide range of information. For instance, they take into account a company’s financial strength and performance, the age and line of business, the business’ payment behaviour, and whether the business has any mortgages, charges or County Court Judgements registered against it. They also take into account the number and experience of a company’s directors. If these data change, the scores for that company may change.
Will the D&B Maximum Credit Recommendation change?
The Maximum Credit Recommendation for a business may change if the Failure Score for that business changes.
Will I receive Monitoring Notices?
The data changes will only trigger a Monitoring Notice if there is a significant impact on the scores and ratings.
Why are D&B changing the scorecard again?
We are not. The score changes driven by the Companies Act 2006 implementation are due to the enhancement of data rather than a change in the way we use that data in our scores.
Could D&B have made these changes in June when the UK Failure Score was adjusted?
No. The current data changes are being driven by the Companies Act 2006, which is being implemented on 1 October 2009.
How quickly will the new data feed into the products and scores?
The new data will start to be reflected in the products from early October, with scores and ratings being refreshed over the course of several months. We do not want to impose a large volume of change on our customers and are aiming to help our customers manage the change by controlling the output.