Credeity publishes its methodology so lenders can evaluate the analysis the way they would any underwriting input. This page describes how reports are produced, how findings are computed, and the limits of what can be inferred from the underlying data. The same material appears in every issued report.
What the analysis is
The Credeity Evidence Report and Analytics Supplement are an independent third-party review of observed payment and receivables behavior for commercial borrowers. The analysis is lender-initiated and borrower-authorized. Credeity does not make credit decisions; the report is one input among several in the lender's underwriting process.
Controlled vocabulary
Credeity uses a fixed vocabulary across marketing copy and issued reports so evidence classes, process, and outcomes mean the same thing on every surface. Evidence class describes what a record is. Acquisition describes how Credeity received it. These are independent attributes.
Evidence classes
- Borrower-reported evidence. GL and AP exports, financial statements, AR aging, debt schedule. What the borrower represents.
- Financial-institution evidence. Records produced by a financial institution reflecting account activity Credeity did not create.
- Authoritative-source evidence. Records Credeity obtains directly from an external authority. NPI, OIG LEIE, SAM.gov, UCC, state licensing.
Evidence class and acquisition
- Evidence class: Financial-institution evidenceAcquisition: Borrower-provided
- Evidence class: Financial-institution evidenceAcquisition: Directly obtained under authorization
Evidence class describes what the record is. Acquisition describes how Credeity received it. A record's class does not change with how it was acquired; the report states both.
Process
reconcile. The process by which Credeity compares evidence classes and reports a verification outcome.
Evidence relationship
- corroborates. Sources support the same representation within the tested scope.
- does not corroborate. Sources diverge, or available evidence is insufficient to support the representation.
Verification outcomes
- Match
- Partial Match
- Variance
- Unable to Verify
- Not Tested
- Not Applicable
Decision authority
The lender determines credit significance.
Acquisition
Acquisition records how evidence reached Credeity. Borrower-provided evidence is furnished by the borrower. Directly obtained evidence is retrieved by Credeity under borrower authorization. The report states acquisition for every account. Acquisition is independent of evidence class.
Data sources
Findings derive from borrower-furnished accounting system exports of vendor obligations and payment history (QuickBooks or equivalent), borrower-provided bank statements for the reporting period used for Tier 1 reconciliation where available, and accounts receivable aging reports as of a stated cutoff date. Reports are point-in-time artifacts tied to a stated reporting window and report date.
Deterministic scoring
The Payment Discipline Index is a bounded 0 to 100 score derived from outbound payment behavior. Scoring is deterministic: the same ingested payment set always produces the same score. Tier assignment drives how late payments affect the PDI. A payment counts as on-time when days late is zero or negative. Late payments are penalized by tier and day-bucket severity. Interpretation bands are a reporting convention:
- Strong: 90 and above
- Monitored: 85 to 89
- Elevated: 75 to 84
- Acute: below 75
Band thresholds are expert-judgment calibrations, set from observed payment behavior distributions across healthcare practice accounting data and reviewed against credit officer interpretation. They are not derived from realized default outcomes. Credeity will publish outcomes analysis when a sufficient seasoned population exists, and will state the population, observation window, and discriminatory power when it does.
Primary finding and analyst notes
Each report carries a single canonical primary finding derived from the PDI score bands: Strong (90+) maps to STABLE; Monitored and Elevated bands (scores 75 through 89) both map to ATTENTION; Acute (below 75) maps to ADVERSE. Primary Finding terms do not reuse PDI band names. A separate delinquency flag (NONE, PRESENT, or RECURRING) incorporates HIGH-severity flag count and Tier 1 30+ day lateness alongside PDI. Analyst notes are generated by deterministic rules over the report data, not by discretionary authoring. They surface in severity bands with caps on how many notes appear, ordered by severity. Underwriting flags are produced by the same rules engine from the same ingested payment set.
Quality controls
The ingestion layer emits structured data-quality warnings covering duplicates, date-range issues, future dates, ambiguous date formats, zero amounts, low row counts, and missing critical fields, so operators can trace upstream data issues. Deduplication and exclusion rules are deterministic and applied before any scoring runs. A minimum-row gate is evaluated after deduplication to flag thin datasets. Edge cases receive documented defaults rather than silent failure, with internal logging of assumptions.
Independence and verification
Bank statements are reviewed as an independent verification layer: borrower-provided accounting data is reconciled to observed bank debits before the report is issued. Categories that cannot be matched to a bank debit are reported as Unable to Verify in the report rather than assumed.
Credeity obtains authoritative-source records directly: NPI, OIG LEIE, SAM.gov, UCC, and state licensing. IRS Form 941 transcript information is obtained by the lender under borrower authorization and reconciled by Credeity. Every report states the obtaining party and as-of date for each record. Authoritative-source and lender-obtained items in the Comprehensive tier are summarized as follows:
| Item | Obtained by | Source | Refresh |
|---|---|---|---|
| Provider identity and enumeration | Credeity | NPPES NPI Registry | Per engagement |
| Federal exclusion screening | Credeity | HHS OIG LEIE | Per engagement |
| Federal debarment screening | Credeity | SAM.gov exclusions | Per engagement |
| UCC national lien status | Credeity | State UCC filing offices | Per engagement |
| Professional license status | Credeity | State licensing boards | Per engagement |
| IRS Form 941 transcript status | Lender, via borrower-executed IRS authorization | IRS | Per engagement |
Items that cannot be corroborated are reported as Unable to Verify rather than omitted.
Authoritative-source records state a status as of a retrieval date. Unless the source provides historical status, a current record does not establish the same status at an earlier point in the review period.
Known limitations
Revenue and collections are Not Tested unless stated as Financial-institution evidence or Authoritative-source evidence. The analysis covers the stated reporting window only; behavior after the window is outside scope. Personal financial analysis of the principal guarantor is outside the scope of the report. Latency between practice accounting activity and report issuance equals the practice's export cadence plus ingestion and aggregation time. Each report states its own limitations inline.
Evidence hierarchy
Each evidence source establishes a specific fact and no more. This appendix states the limits of each source used in this report. A finding of Match means sources corroborate; it does not establish that the underlying representation is true in every respect.
| Evidence | Establishes | Does not establish |
|---|---|---|
| GL and AP export | Borrower's recorded obligation and activity | That cash moved |
| Financial-institution evidence (bank statement) | Cash movement | Economic purpose without corroboration |
| IRS transcript | IRS-recorded tax position at retrieval date | Current operating performance |
| License registry | License status at retrieval date | Financial condition |
| UCC filing | Recorded security interest | Current payoff status |
| AR aging | Borrower-recorded receivables | Collectibility |
| Multi-source Match | Corroboration | Absolute truth |
Model governance
The PDI scoring methodology is deterministic and versioned. Material methodology changes are documented, and reports state the conventions in force at issuance. The PDI is a behavioral signal intended for use alongside, not in place of, the lender's existing diligence.
Permitted use of the Payment Discipline Index
The PDI is validated as a behavioral observation, not as a predictor of default. Bands are calibrated to observed payment behavior distributions, not to realized loss outcomes.
Supported uses today:
- documentary evidence in a credit memo or file
- corroboration or challenge of borrower-reported financial information
- support for a policy exception, condition, or covenant
- a prompt for additional diligence before closing
- annual review and portfolio surveillance evidence
Uses Credeity does not support today:
- an input to a risk rating, PD, or LGD estimate
- an input to a pricing grid
- an automated approval, decline, or pre-screen cutoff
- a substitute for the lender's own cash flow analysis or global debt service calculation
A lender that incorporates the PDI into a rating, pricing, or automated decision has made it a model input under SR 11-7 and OCC 2011-12 and assumes the associated validation obligation. Credeity provides the full model documentation package to support that validation, and will state population, observation window, and discriminatory power when a seasoned outcome population exists.
Ready to evaluate a healthcare borrower?
Schedule a Demo