ABL collateral monitoring that watches every borrower's collateral daily, between field exams
Collateral changes flagged within days, not at the next exam.
See one case, screen by screen ↓Software that watches the receivables and inventory behind an asset-based loan between field exams: it reads the borrower's certificates, agings, credit memos and lockbox files, recomputes the borrowing base under the credit agreement and flags changes. ABL Collateral Monitoring does this every day for every borrower, with six agents and a collateral manager who decides.
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An asset-based lender is only as safe as its view of the receivables and inventory it advances against. Today that view comes from the borrower's own borrowing base certificate, weekly or monthly, and a field exam that tests a sample once or twice a year. The certificate is the borrower's number; the exam is a snapshot.
Between the two, a customer can grow past its concentration limit, credit memos can climb, lockbox receipts can slow and the aging can roll past 90 days. Each signal lives in a different file — concentration in the aging, dilution in the credit-memo register, collections in the lockbox file, the comparison with the exam in the examiner's workpapers — and the collateral manager reviews each borrower once a month in a spreadsheet. By the time the next exam adds it up, the line is over-advanced.
Estimated split for one borrower's monthly review, by hand and with the solution.
Six specialist agents chart every borrower's daily collateral against its own control limits; the collateral manager decides.
Monday 12 October 2026 at Bramwell Business Credit: 46 borrowers, $1.12B outstanding. Ashford Fastener & Supply's certificate says it has $5,187,000 of excess availability. Here is what the working solution finds, screen by screen.
The agents read 46 lockbox files ($41.8M received across the portfolio) and 45 daily sales and credit journals — Bellwether has sent none since 25 Sep. By 06:07, 184 measures are plotted against their limits: dilution, DSO, collections and inventory turns for every borrower, each with its last 30 days coloured.
“4 beyond a limit · 5 drifting · 170 in control · 5 without data.”
Elena opens on Ashford's trailing 30-day dilution: 6.62% today, against a centre of 3.40% and limits of 0.55%–6.25% set from the 12 months before its 14 Apr 2026 field exam. Day 17 of September is ringed — 6.41%, +3.2σ, beyond the limit. Behind it: credit memos to Tremont, the top customer, of $512,600 in 30 days against $168,400 a month in the year before the exam, with the largest memos listed.
“Flagged 21 days before certificate 41 and 115 days before the next field exam.”
Every borrower's collateral is recomputed under its own credit agreement and ranked against its last exam. Ashford tops the list at a risk of 86 with four alerts: $3,778,550 of excess availability recomputed, against $5,187,000 certified. Across the portfolio, the certificates overstate availability by $3.28M.
Ashford's cockpit puts the certificate and the recomputed base side by side, under a red banner: on the recomputed base, it is under the $4,500,000 trigger. Tremont is 23.6% of receivables against a 20% limit and 14.2% at the exam; DSO is 58 days against 47; aging past 90 is 9.8% against 4.1%. The September credit-memo register arrived at 08:51 and is not in the number yet.
Elena presses Re-check. The register is read — 214 memos, $1,482,120, tied to the general ledger to the dollar. This morning's lockbox shows $612,400 received and nothing from Tremont since 3 Sep. The eligibility checker applies §1.1; the dilution analyst works the reserve; the scorer recomputes.
“Excess availability $3,519,646 — $980,354 under the trigger · risk 86 → 91.”
Tremont Equipment Works is $9,067,000 of receivables against a limit of $7,684,000, so $1,383,000 is ineligible; Delmar Hydraulics is 55% past 90 days, over the 50% cross-aging line, so its remaining $274,000 comes out too. Neither was taken off certificate 41. Trailing three-month dilution is 5.8% against 3.1% at the exam; 61% of September's credits were pricing adjustments, and the agreement's rule gives a 0.8-point reserve of $258,904.
Lockbox receipts over the last six weeks are $4.33M a week against $5.28M before — down 18% — while weekly sales are up 1%. Tremont's receipts fell 88% and it is marked “Stopped paying”. The September roll-forward still explains the aging within $64,120 (0.17%, inside the 0.5% tolerance): the receivables are real, they are just not being paid.
Line by line: borrowing base $38,367,000 as filed, $36,699,646 recomputed; excess availability $5,187,000 against $3,519,646. Six checks passed, from the certificate tying to the 9 Oct aging to insurance naming the bank as lender loss payee. Under §7.4, below the trigger, cash dominion springs and the 1.10x fixed-charge test applies.
“That is a covenant decision for Derek Oyelaran and Margaret Lindqvist — the agents only refer it.”
The proposal: take Tremont's excess and Delmar out of the base, take the dilution reserve, bring the field exam forward from 11 Jan 2027 to Mon 26 Oct 2026 with Sam Whitlock for three days, ask Ashford for a corrected certificate by Wed 14 Oct, and refer the trigger. The exam scope is four tests drawn from the alerts, starting with 25 Tremont invoices dated after 1 Sep, confirmed with Tremont's accounts payable.
“Letter to Ashford — drafted · sent only when approved.”
Elena approves a $1,667,354 reduction in availability. It is above her $500,000 limit, so it goes to Margaret Lindqvist, chief credit officer, who co-approves minutes later. The letter goes to Ray Kowalczyk, Sam Whitlock is booked for 26 Oct, and the trigger referral goes to Derek Oyelaran — the cash dominion notice stays with the people who own it.
The same borrower, seen by the four people who carry it — what their month looked like, and what it looks like now.
Six specialist agents chart every borrower's daily collateral against its own control limits; the collateral manager decides.
Reads certificates, agings, inventory reports, ledgers and credit-memo registers as they arrive, extracts each figure with its page and line, and ties the certificate to the aging.
Reads each day's lockbox and bank files at 06:00: receipts by customer, collections against sales, DSO and the monthly roll-forward; flags a customer that stops paying.
Applies each credit agreement's own definitions — concentration, cross-aging, past due, contras, foreign, affiliates — and recomputes the borrowing base and excess availability.
Measures dilution from the credit-memo register by month, reason and customer, compares it with the last field exam and works out the reserve the agreement calls for.
Plots every borrower's daily measures against control limits from its own history, applies the run rules, compares with the last exam, ranks the portfolio and raises alerts with their evidence.
Turns open alerts into a proposal: ineligibles and reserves, a targeted exam scope and date, the borrower letter and a referral, routed above the collateral manager's limit to the chief credit officer.
Decides; chief credit officer co-approves above $500,000. The agents propose; a named person decides.
Ask about any borrower, measure or alert — or tell it what to change. Every answer points to the certificate, aging, register or agreement clause it rests on.
Why is Ashford's availability lower than its certificate?
Three things the certificate leaves out, each from the credit agreement: Tremont at 23.6%, over the 20% limit (−$1,175,550); Delmar Hydraulics cross-aged, 55% past 90 (−$232,900); and a dilution reserve, 5.8% against the 5% line (−$258,904). Certified excess availability is $5,187,000; recomputed it is $3,519,646, under the $4,500,000 trigger.
Show Tremont's share of receivables since the exam
Tremont Equipment Works was 14.2% of Ashford's receivables at the 14 Apr exam. It rose every month with the Q3 price programme, sat just under the limit at 19.9% on 2 Oct, and reached 23.6% ($9,067,000) on Friday's aging. It has paid nothing since 3 Sep.
What drove Ashford's dilution in September?
September credit memos were $1,482,120, 6.9% of sales. 61% were pricing adjustments — $862,000 of them to Tremont under its Q3 price protection. Over three months dilution is 5.8%, against 3.1% at the exam; the agreement takes 1 point of advance rate per point above 5%, so the proposed reserve is $258,904.
Bring Ashford's field exam forward to 26 October
Done. Sam Whitlock is free the week of 26 October — 3 days on site, instead of 11 January. The targeted scope now covers Tremont invoices after 1 Sep, September credit memos over $50,000, why Delmar Hydraulics is not paying, and six weeks of lockbox to ledger. The letter to Ray Kowalczyk now gives the date. It goes when you approve.
13 screens from the working solution, on its sample data. Pick one to see it large.
The limits every borrower is watched against are settings. Each credit agreement can override them, and changes are versioned and on the audit trail.
| Setting | Default | Choose from |
|---|---|---|
| Concentration limit | 20% | Any share, per borrower |
| Cross-aging | 50% | 50 · 25 · 10% |
| Past due | 90 days | 90 days · 3× terms · 60 days |
| Dilution line | 5% | 5 · 4 · 6% |
| Dilution reserve rule | 1 point of advance rate | 1 point · 0.5 point · Off |
| Collections drop alert, over 6 weeks | 15% | 15 · 10 · 20% |
| Warn before the trigger | 125% of the trigger | 125 · 150 · 110% of the trigger |
| Collateral manager approves up to | $500,000 | $500,000 · $250,000 · $1,000,000; above it the chief credit officer or the head of asset-based lending |
Every figure is labelled: a target the solution is built to, an estimate, a typical published result, or a proven one.
“demo” = seen in the working solution, on its sample portfolio · “estimated” = our estimate · “typical” = published figures (SFNet via Cobalt Intelligence: 50% of lenders strengthened monitoring; OCC Comptroller's Handbook, Asset-Based Lending, on field audits, concentration and dilution). People, lenders and borrowers named on this page are fictional — characters and sample data in the working solution.
Software that watches the receivables and inventory behind an asset-based loan between field exams: it reads the borrower's certificates, agings, credit memos and lockbox files, recomputes the borrowing base under the credit agreement and flags changes. ABL Collateral Monitoring does this every day for every borrower, with six agents and a collateral manager who decides.
It plots each borrower's daily dilution, DSO, collections and inventory turns on control charts, with a centre line and limits set from that borrower's 12 months before its last field exam. Run rules — beyond a limit, two of three past 2σ, four of five past 1σ, eight in a row — mark drift, and a point past a limit opens the transactions that caused it.
Yes. The eligibility and concentration checker reads the Eligible Accounts and Eligible Inventory definitions from each agreement and applies them to the latest aging and inventory — concentration, cross-aging, past due, contras, foreign and affiliates — then compares excess availability with the certificate and the covenant trigger.
No. The agents propose reserves, ineligibles, a targeted exam and a letter; the collateral manager decides, and above $500,000 of availability effect the chief credit officer co-approves. Cash dominion, default notices and amendments stay with the portfolio manager and the chief credit officer.
When two or more alerts are open on one borrower, it proposes a targeted exam with tests drawn from the alerts and a date from the examiners' schedule. In the working solution, Ashford's exam moved from 11 Jan 2027 to 26 Oct 2026 with four tests.
Borrowing base certificates, receivable and inventory detail, daily sales and credit journals, credit-memo registers, lockbox and bank files, credit agreements and amendments, and prior field exam reports. Lockbox files are read every morning at 06:00.
Yes. Concentration limit, cross-aging, past due, dilution line and reserve rule, collections drop, DSO change, roll-forward tolerance, trigger warning, late certificate and approval limits are all settings, and each credit agreement can override them.
The Agentic Solution Engine builds and deploys it from your requirements — your credit agreements, credit policy and a sample of borrower reports and lockbox files — and it goes live once every quality gate has passed. We will walk you through it on your own borrowers first.
We'll run ABL Collateral Monitoring on a sample of your own borrower reports and lockbox files.