Understanding the ABL Monitoring Process

We’re often asked why we do field exams three times a year along with ongoing verifications. The general answer (and as is the case with all lenders) is these processes enable us to verify how the business is doing financially and if it’s in compliance with the terms of its loan agreement. The specific answer with respect to Celtic Capital’s frequency is because of the volatility of our clients’ businesses. While banks typically audit their clients less frequently, our client base is in a much riskier place than when they’re with a bank so monitoring more frequently is appropriate.

Another distinction of note is that banks focus on the balance sheet; we focus of the assets being financed. That said, field audits enable us to get a better sense of how the business is running, check out the warehouse, see how inventory is organized and tracked, talk to some of the employees and generally, take the pulse of the company.

Our goal is to get our clients back to bank financing as soon as possible. Working with them and helping them “fix” the issues that steered them to us in the first place is a priority and field audits and verifications fall under that umbrella.

About Celtic Capital
Companies looking for working capital to cover operating expenses, fund growth, increase buying power and take advantage of vendor discounts and rebates turn to Celtic Capital. With an appetite for the more complex transactions, Celtic Capital has a history of success in crafting creative, flexible asset based financing solutions from $500,000 to $5 million with no financial covenants.

As an independent lender, working with companies nationwide, Celtic Capital is willing and able to alter price and deal structure and expand lines of credit to handle its clients’ increased revenues; and when cash flow is an issue, will look toward providing an inventory facility to help offset lost cash flow.

If you know of, or are, a business in need of non-traditional financing, contact Mark Hafner at 800.742.0733 or mhafner@celticcapital.com, or visit us at www.celticcapital.com.