whats the important division in external ratings?

Using moody's describe this in terms of grades...

important division is between investment grade and non-investment grade.

For moody's this division is between grades Baa (grades this and above are investment grade) and Ba (and below = non-investment grade).

1 - Qualitative analysis

2 - Quantitative analysis (eg, financial ratio analysis)

3 - Meet firms' management

4 - Meeting fot he committee in the rating agnecy assigned to rate the firm

5 - Notify the rated firm of the assigned rating.

6 - Opportunity for the firm to appeal or offer new info

7 - Make the rating public

to score a company...

at the point - the goal is to predict the credit quality over a short horizon (generally 1 year) Uses quantitative models.

Through the cycle - longer time focus and includes the effects of forecasted cycles. Uses more qualitative assessment.

at the point