Entity Rating Report (Inc. Business & Financial Risk Analysis)

Overview 🔎

I had to prepare an entity rating report for Siemens AG. This included complete business as well as financial risk analysis of the company performance for the year 2020. This project was assigned by a Saudi client and had to assign credit rating to Siemens AG based on the risk analysis.

Problem & Solution 🤝

I had to prepare an entity rating report for Siemens AG. This included complete business as well as financial risk analysis of the company performance for the year 2020. This project was assigned by a Saudi client and had to assign credit rating to Siemens AG based on the risk analysis. The contents of the report include: Profile of the company 1. Qualitative Risk Factors 2. Structural Risk Factors 1) Macroeconomic Environment 2) Operating Environment 3) Regulatory Environment 3. Business Risk Factors 4. Financial Risk Factors

Goals/Requirements: Following requirements were made by the client:

Process 🛣

I started with the following step wise approach as per the requirement.

1) Qualitative risk analysis includes: Ownership Structure Governance Framework Management and Systems Monitoring and Control Environment 2) Structural risk factors include the impact of macro environment and regulatory framewrok on the business sector 3) Business risk analysis included: Revenue streams Future projections of on going and future projects 4) Financial Risk analysis: I had to first translate the financial statements from arabic to english for the years in consideration. Next following ratios were calculated and explained for P&L and balance sheet. This analysis was supported by relevant graphical representations. Revenue Trend Margin Ratios Composition of Asset mix Leverage position Dividend payouts Working capital cycle status

Results 🎁

The final rating was based on the above analysis performed for the client.