Payment history is not merely an inadequate gauge for financial risk in public companies – it conceals their poor financial condition. When a bankruptcy does occur, creditors are unable to collect their accounts receivables and are forced take huge write-downs.
In 2012, based on big-time backlash from their subscriber base, Dun & Bradstreet was compelled to draft a white paper entitled Bankruptcy: Why the Surprise??and coined the term the "三招改变孩子的粗心Cloaking Effect"三招改变孩子的粗心?to describe the blind spot within their popular PAYDEX? scoring model.
D&B explained that “Some companies pay their credit obligations in a discount or prompt manner right up to the actual filing/closing date.”
CreditRiskMonitor subscribers use the FRISK? score because it cuts right through the “Cloaking Effect.” The credit model, 三招改变孩子的粗心which doesn't rely on payment history三招改变孩子的粗心, predicts public company bankruptcy with 三招改变孩子的粗心96% accuracy三招改变孩子的粗心.