What the examiner usually asks for
Every lender has its own list, and your credit agreement defines what counts as eligible. For a consumer brand the request typically includes:
- The borrowing base certificates for the period, with the support behind each line
- An inventory perpetual by SKU and location that ties to the general ledger
- Inventory aging, built on receipt dates rather than last-sale dates
- A slow-moving and obsolete report by SKU, usually against trailing-twelve-month sales
- Ineligible inventory: in transit, at third-party locations, consigned, damaged or returned
- Receivables aging and dilution if you sell wholesale
- Sales and cash tie-outs, and samples the examiner traces back to source documents
Where the prep time goes
Sample figures to show the format. The bigger saving is that the same reports run monthly, so the exam stops being a surprise.
Same question, two answers
412 SKUs have had no sales in the last 90 days, totaling $1.2M at cost. Consider a clearance promotion.
Uses last-sale date and a 90-day window it made up. Ignores the definition in your credit agreement. Cost from the platform field.
On the credit agreement's test, 186 SKUs are slow-moving: $640K at landed cost, 7% of eligible inventory. 41 are core styles with a reorder received in the last 90 days, so aging by receipt lot keeps them eligible. Most of the rest are two discontinued colorways from last fall.
The lender's definition, landed cost from the file you trust, receipt dates by lot, and the explanation the examiner will ask for.
What the model has to learn
- Your credit agreement's definitions. What is eligible, what is excluded, and the aging and slow-moving tests exactly as written.
- Your source of truth for inventory. Which system wins when the store platform, the warehouse and the ledger disagree, and how to explain the difference.
- Your cost basis. Landed cost, including freight and duty, from the file finance actually trusts.
- The story behind the movements. Seasonal builds, discontinued lines and in-transit receipts, so the answers to the examiner's questions are ready before they ask.
Building this is often part of an operations audit. Once it exists, the same reports become a monthly inventory health check, which is where the real value is.
Related
Questions
How often do field exams happen?
Your credit agreement sets it. Once or twice a year is common, and lenders often look more often when availability is tight or results miss plan.
Can AI produce the borrowing base certificate?
It can build the support behind it and check it against the source systems before anyone signs. A person on your team still reviews and signs the certificate.
Will the lender accept reports a model built?
Examiners care that every number ties to your books and source systems, and that you can show how. A model built for this traces each figure back to its source file, which makes the tie-out faster to show, not harder.
Which systems does it work with?
Whatever holds your inventory and receivables today: the store platform, an inventory or warehouse system, NetSuite or QuickBooks, and the spreadsheets that fill the gaps.