Finan Financials is a module solution for the management of credit risk aspects of your SME portfolio. Current modules are:

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1 Your business requires you to have a thorough knowledge of the companies and groups in your credit portfolio. The manner in which you gather, store and process company data in your commercial and risk management process is strongly influenced by Basel III and local supervisory acts and laws, as well as by market s call for more transparency. Increasing competition in the premium markets calls for high efficiency and better integration of your commercial and risk management processes. Finan Financials is a family of software products that addresses the needs of modern financial institutions providing credit facilities for SME s. Topicus combines state-of-the-art technology with twenty years of experience in the field of credit risk management. In other words, we are wellequipped to support your specific requirements.

2 Finan Financials is a module solution for the management of credit risk aspects of your SME portfolio. Current modules are: Finan Core Financials Finan Financial Analyzer Finan Risk Analyzer Finan Qualitative Analyzer Finan Forecasting Finan Valuation Finan Benchmarking Finan for Risk Units Finan for Portals Core module, for entry, storage of financial statements, including support for SBR. Advanced support for SBR is available through the modules SBR Connect and SBR Level II. Analyzes cash flow over 120 financial ratios, grouped together in logical clusters and dashboards that lay bare the weak spots. Determines scores, ratings and return on capital, using your rating model or your own. Defines, executes, analyses and produces reports on qualitative questionnaires. Creates forecasts for individual companies, includes Finan fast-forecast. Determines the objective value of a company by means of several well-known valuation methods, such as DCF. Enables comparative analysis of peer groups, both at an individual level and as a group. Creates financial consolidations of multiple entities into a new risk unit for credit risk assessment and valuation. Enables self-service by integrating facilities and sample applications with client portals. When the modules are combined, functional synergy is created. For example, by combining Qualitative Analyser with Risk Analyzer you can use extensive qualitative questionnaires in your rating models. Using the Risk Units extension pack in combination with Valuation enables you to assess the value of a consolidated group of companies. If you use it in combination with Risk Analyzer, you can calculate scores and ratings.

3 the independent credit risk management solution Finan Financials is the most advanced software solution for SME credit risk management available on the market today. Finan Financials offers a multitude of advantages. It is the only SBR-centric risk analysis software available today. It supports multiple financial statement layouts for localization (country-specific accounts) and sectors and automatically maps to the standard layout of the enterprise, whether SBRbased or other. Preconfigured are IFRS, US-GAAP, NL-GAAP, DE-GAAP. It supports viability analysis of business plans, payments capacity calculations, balance after credit, valuation, forecast vs. realization analysis, qualitative risk analysis, pricing based on RORAC and its variations, as well as over 120 financial ratios grouped in logical clusters in an exception dashboard. It has a unique fast-forecast function, that uses intelligent algorithms and business rules. The end user can make forecasts with multiple scenarios in a trice. It contains a built-in currency conversation, with support for manual exchange rate overrides. It produces insightful reports with an adjustable set of clear graphs for trends and tables for facts. It is an open system: functional extensions that are enterprise-specific are easily implemented. Self-service concept can be created through seamless integration with customer portals. Finan Financials is member of the Force product family. Force is a high-end credit management solution for front-, mid- and back office processes. Case management and workflow management Operational management cockpits with predictive resources allocation Financial product configuration engine Business rules engine, aimed specifically at credit processes

4 Although new types of risk drivers have lately emerged on the market, a sound risk management strategy is still founded on thorough financial analysis. Finan Financial Analyzer provides you with all the powerful analysis tools you need to find the strengths and weaknesses of an organization s financials. Automated cash flow analyses help you to determine the payments capacity of an organization. A dashboard with over 120 financial ratios, grouped together in logical clusters, enables you to detect the exceptions at a glance. Drill down through the financial statement to find the causes of bad ratios. By switching from monthly to annual views, you can determine long-term trends. The scorecard gives you an overview of ratios compared to sector benchmarks. Sector figures are provided by your sector experts, purchased from independent data providers, or gathered by the Finan Financials Benchmarking module.

5 Financial Analyzer member of Finan Financials Features Finan Financial Analyzer Finan Financial Analyzer is a comprehensive tool for the analysis of financial statements. It uses balance sheets and income statements as input for the calculation of cash flow statements and for a large number of common and lesser-known financial ratios. The cash flow statements include statements of operational activities, and financing activities. These statements consist of several levels of detail that enable drill down analyses. The cash flow offers a good starting point for computing investments and financial plans (forecast module). The model consists of different parts that together from a tight entity. A change in one part is propagated automatically to other parts. Data can be processed and displayed on a yearly basis, period of half a year, a quarter of a year, or a month. The financial ratios are grouped by indication, such as profitability ratios, liquidity ratios, activity ratios, leverage ratios, stock market ratios, and capital budgeting ratios. Context-sensitive documentation can be displayed to explain the meaning of individual ratios. The benchmarking process (Benchmarking module) is based on these ratios. Integration with Finan Financials Finan Financial Analyzer is part of the Finan Financials suite. When combined with other suite components, an optimal credit risk environment is created. It performs its analysis functions on the account schemes available in Core Financials. Any data available in the Statement Repository can be used as input for the analysis. In combination with Risk Unit Management, the analysis capabilities extend to consolidated risk units as well. Financial Analyzer can aid the account manager in the quick and confident assessment of unexpected outcomes of ratings and scores from Risk Analyzer and enables him to advice his client on where to improve financial structures.

6 Financial Risk Analyzer In light of Basel II compliance, risk based pricing, stronger competition and the market s call for transparency, it is becoming increasingly important to create an efficient business process for provisioning, rating and scoring. The challenge that risk management departments are facing today are complicated by the continuous increase of regulatory compliance requirements (for example, the new European Consumer Credit Directive) that not only impact the risk acceptance process, but the entire credit administration as well. Recent advancements in risk management are forcing financial institutions to standardize and objectify their risk management systems. Credit decisions, as well as the data they are based on, have to go through a full audit trail and an integral repot has to be send to internal control and to external supervisors. Finan Risk Analyzer aids the setup of the necessary risk infrastructure and can be fully integrated with the credit workflows of your organization. Finan Risk Analyzer allows you to setup standardized scorecards for each peer group. Peer groups can be identified by any company property (like balance total, sector code, etc.). Based on the outcome of the scorecards, a rating and a probability of default (p.d.) is calculated. By combining a company s financials with the credit facilities they plan to use and the securities they are willing to give, loss given default (L.G.D.) and risk adjusted return on capital (R.A.R.O.C. and its variations) can be reported or used in credit scenario s.

7 Risk Analyzer member of Finan Financials Features Risk Analyzer Finan Risk Analyzer is an module of the Finan Financials product family and performs integrated riskrelated calculations on companies and risk units. Risk Analyzer is meant to give you (risk managers, account managers, and other stakeholders) an overview of the implications of doing business with the company you are assessing. Capital leverage is the central concept, expressed in expected (risk adjusted) return on capital. Risk Analyzer contains all the formulae required to calculate return on capital. Each formula can be parameterized and changed in our Create-Maintain-Use approach. Whenever the status of a customer s file changes, the base data is versioned and kept for future auditing. Due to elaborate authorization schemes and integration with your enterprise authentication system, only authorized staff can create, update or view a company s risk and return profile. Finans powerful model engine ensures that all data is kept consistent at all times, thus reducing data quality issues. Full XBRL import facilities further reduce such risks. Integration with Finan Financials Finan Risk Analyzer is part of the Finan Finacials suite. When combined with other suite components, an optimal credit risk environment is created. All client company data, financial and non-financial, is made available in a single company file. In combination with the Risk Unit Management module, individual companies can be consolidated into risk units, with all assets, liabilities, securities and facilities available for risk calculations. Since Finan Financials has the ability to handle multiple scenario s, Risk Analyzer can be used to optimize a client s credit facility mix by evaluating what-if scenario s. Our product Risk Cube (built on the foundation of Finan Financials with Risk Analyzer) was developed for enhanced straight through processing of credit applications and renewals and produces high volume rating calculations for consumers ans SME s.

8 Finan Qualitative Analyzer Finan Qualitative Analyzer is a flexible system that is used to carry out, report on and analyze qualitative facts on companies. Questionnaires can be added to Finan Financials, which can be filled out by account managers, bankers or (through Finan for Portals) a responsible officer at your client s company. Topicus typically addressed by qualitative questionnaires include: Management or entrepreneur quality (personal and team level) Sustainable and environmental awareness Sales process, level of professionalism Generic risk analysis of a company s operations Sector specific company details Many Basel II/Basel III complaint risk management models include one or more qualitative risk drivers. The most common one is quality of management, which gives the account manager the option to choose between poor, average and good. A better grounding of such assessments can be achieved by applying questionnaires that are set up to force the account manager to objectify his opinion. In the example above, a set of questions on management behaviour would result is a score of management quality, which can be used a credit risk driver.

9 Qualitative Analyzer member of Finan Financials Features Qualitative Analyzer With the implementation for Finan Qualitative Analyzer, administration tabs are added to the Finan Core Financials administration environment for the following: maintenance of questionnaire definitions, reporting templates, mapping to Financials account schemas, and authorization set up. Questionnaires are filled out in a user-friendly, browser-based application that integrates seamlessly with Finan Financials. Questions and their possible answer domains, multiple-choice or free text, can be specified, after which the data quality is checked when the data is entered. Business rules can be set to determine the flow of questions in the questionnaire, so that irrelevant questions are be skipped automatically. Questions can be grouped to avoid screen clutter. Integration with Finan Financials Finan Qualitative Analyzer is part of the Finan Financials suite. When combined with other suite components, an optimal credit risk environment is created. Answers can be mapped to Finan Risk Analyzer variables to create a scoring environment for qualitative risk drivers. Questionnaires can be filled out for individual entities as well as for combined Risk units. They can also be used as a qualitative explanation for a scenario made with Finan Forecasting. Self-assessment can be offered to your customers through Finan for Portals, the toolkit that integrates Finan Financials functionalities with your customer portal. Contact Topicus Singel HW Deventer finance@topicus.nl