When Legl runs a company report, it includes a Dun & Bradstreet (D&B) credit assessment. This covers the credit rating commentary, a Score & Rating, and financial strength and risk indicators — all drawn from D&B's proprietary scoring model.
This article explains what each section means and how to interpret the data.
What's the credit rating commentary, and how does it influence the credit rating/risk of the company?
The credit rating commentary is a written overview of the company's credit report. It is designed to highlight any positive or negative items about the company that could affect its creditworthiness.
When comparing the credit rating commentary in Legl with data from other external sources, always pay close attention to the reported dates — D&B updates its database periodically, so timing differences between sources can affect what is shown.
What is the Score & Rating?
The Score & Rating helps you identify organisations that are likely to fail or pay late. It supports more consistent, automated decisions across your firm and allows you to quickly identify risk and opportunity across a portfolio.
The rating is made up of two parts, presented together in the format [Financial Strength] – [Risk Indicator]:
Financial Strength — based on the company's Tangible Net Worth from its latest filed accounts
Risk Indicator — derived from the D&B Failure Score, combined with expert rules and overrides
Financial Strength
The Financial Strength indicator is based on the company's Tangible Net Worth and is shown as a letter code. The table below shows what each code represents:
Financial Strength | Tangible Net Worth — From (£) | To (£) |
5A | 35,000,000 | And above |
4A | 15,000,000 | 34,999,999 |
3A | 7,000,000 | 14,999,999 |
2A | 1,500,000 | 6,999,999 |
1A | 700,000 | 1,499,999 |
A | 350,000 | 699,999 |
B | 200,000 | 349,999 |
C | 100,000 | 199,999 |
D | 70,000 | 99,999 |
E | 35,000 | 69,999 |
F | 20,000 | 34,999 |
G | 8,000 | 19,999 |
H | 0 | 7,999 |
N | Negative net worth (negative balance of equity after deduction of intangibles) | Negative net worth (negative balance of equity after deduction of intangibles) |
O | Net worth undetermined (accounts unavailable or older than 2 years) | Net worth undetermined (accounts unavailable or older than 2 years) |
NB | New Business (less than 12 months old) | New Business (less than 12 months old) |
NQ | Out of Business: business has ceased to trade | Out of Business: business has ceased to trade |
Risk Indicator
The Risk Indicator combines the D&B Failure Score with expert rules, including:
Minimum Data — identifies trading activity and provides substance for the score
High Risk Parent — high risk of a parent cascades down through the corporate family tree to subsidiaries
Detrimental Legal Events — includes failure events (e.g. administrator appointed, bankruptcy) and detrimental auditor reports
Possible Fraudulent Activity — D&B specialists identify potential fraudulent businesses; scores are removed or shown as High Risk
Manual Overrides — authorised experts can adjust scores to reflect non-statistical or catastrophic events
Risk Indicator | Meaning | Guidance |
1 | Minimal risk | Proceed with transaction — offer extended terms if required |
2 | Low risk | Proceed with transaction |
3 | Slightly greater than average risk | Proceed but monitor closely |
4 | Significant level of risk | Take suitable assurances before extending credit (e.g. personal guarantees) |
– | Insufficient information | No public or D&B proprietary information available to assign a valid risk indicator |
How do D&B ratings compare to credit risk levels?
D&B assigns ratings on a scale from 1A (excellent) to 5A (very weak), based on a company's credit risk and financial health. The table below shows how D&B combined ratings map to overall credit risk levels:
D&B Rating | Credit Risk Level |
1A-1, 1A-2 (Excellent) | Very Low Risk |
2A-1, 2A-2 (Good) | Low Risk |
3A-1, 3A-2 (Fair) | Moderate Risk |
4A-1, 4A-2 (Weak) | High Risk |
5A-1, 5A-2 (Very Weak) | Very High Risk |
ℹ️ Important
The specific definitions may vary slightly depending on the model or context. Use this table as a guide rather than a definitive reference.