# Draft Credit Compliance Cert > Prepares a quarterly covenant compliance package consisting of a compliance memo, a calculation workbook, and an officer-certifiable certificate, including independent verification of the borrower's preliminary figures. - Skill: `finchipaiorg/draft-credit-compliance-cert` (Agent Skill) - Install (CLI): `npx skillmds@latest add finchipaiorg/draft-credit-compliance-cert` - Raw SKILL.md: https://api.skillmd.com/api/skills/finchipaiorg/draft-credit-compliance-cert/raw - Safety review: pending - Works with: Claude Code, Claude.ai, OpenAI Codex - Category: Coding & Dev Tools - Author: FinchipAIOrg (https://skillmd.com/u/finchipaiorg) - Updated: 2026-09-22 - Page: https://skillmd.com/skills/finchipaiorg/draft-credit-compliance-cert --- # Skill: Quarterly Compliance Certificate Preparation — Complete Covenant Package ## 1. Subject-matter triage - Treat this as a quarterly compliance package with three coordinated outputs: a memo, a calculation workbook, and a certificate. - Start by locating the operative credit-agreement definitions, covenant tests, reporting deadlines, and any specified calculation methodology. - Determine whether the period is a full quarter, stub period, or otherwise non-standard; the annualization method must follow the agreement, not generic practice. - Identify every covenant and certificate representation that is implicated by the quarter-end financials before drafting any narrative. - If multiple borrower-prepared schedules or management worksheets are attached, enumerate them and reconcile each against source financials before using any figure. ## 2. Failure modes the skill is correcting - Producing a narrative memo or simplified certificate without the required calculation workbook. - Using the borrower’s preliminary numbers without independent recalculation from the source financials. - Applying the wrong annualization method for a partial period or stub quarter. - Omitting debt components that the agreement treats as debt, including contingent, accrued, or lease-related items. - Ignoring covenant-specific addback caps, time limits, or cumulative trackers. - Failing to surface the deadline for delivery or the consequences of late delivery. - Certifying no default when the calculations disclose a breach, potential breach, or unresolved assumption. - Treating exclusions or deductions as permissible without locating the specific contractual language that authorizes them. ## 3. Legal frameworks / domain conventions that apply - Read the debt, EBITDA, fixed-charge, and coverage definitions as integrated contractual terms; each defined term may cross-reference other definitions, schedules, or exhibits. - Use the agreement’s own accounting conventions, including any expressly required treatment of GAAP, lease accounting, accrued obligations, and contingent liabilities. - Apply any express limitation periods, forward-looking windows, or trailing periods exactly as written. - Test each covenant against the correct threshold and measurement date, using conservative assumptions where the agreement leaves room for interpretation. - Verify whether the certificate must be delivered within a fixed post-quarter window and whether failure to do so is an independent default. - If the certificate requires a no-default statement, tie that statement to the outcome of the covenant analysis and any known carve-outs or disclosure qualifiers. - Where the agreement incorporates statutory or regulatory concepts by reference, cite them only if they are actually needed to explain the calculation methodology or reporting obligation; otherwise keep the analysis contract-specific. - For New York law-governed credit documents, construe the agreement according to ordinary contractual principles, with each defined term controlling its own calculation field. ## 4. Analytical scaffolds 1. **Source inventory** - List the agreement excerpts, financial statements, management schedules, and any borrower worksheet that will be tested. - Identify which document controls each term, threshold, and deadline. 2. **Debt build** - Recalculate total debt from the balance sheet and footnotes. - Include all items the agreement treats as debt or debt-like obligations, and exclude only items clearly outside the definition. - Reconcile any debt rollforward, lease liability, or contingent exposure item separately. 3. **EBITDA build** - Start from the agreement’s base measure and rebuild the permitted adjustments. - Remove any item that is not affirmatively permitted by the definition. - Test each addback against its own conditions, carryforward rules, and any cumulative or annual cap. 4. **Periodization / annualization** - If the period is not a full fiscal year, apply the agreement’s required trailing or annualized methodology. - State the rationale for the methodology used and the effect on each covenant metric. 5. **Covenant tests** - Compute each leverage, coverage, or fixed-charge ratio using the corrected inputs. - Compare each result to the contractual threshold and identify headroom or shortfall using the agreement’s own measurement convention. 6. **Cap and usage tracking** - Track every capped adjustment in a separate ledger showing current-period usage, cumulative usage, and remaining capacity. - Tie each tracked amount back to the exact contractual cap it consumes. 7. **Worksheet audit** - Compare the borrower’s preliminary schedule line by line against the recalculated output. - Flag any unsupported inclusion, omission, formula error, sign error, or timing mismatch. 8. **Certificate consistency** - Ensure the certificate, memo, and workbook all state the same covenant outcome and assumptions. - If any assumption is judgmental, disclose it consistently across all deliverables. 9. **Downside check** - Run a conservative sensitivity view that shows the effect of disallowing disputed addbacks or reclassifying borderline items. - Use the downside view to test whether the certificate remains supportable. 10. **Deadline check** - Measure the delivery date from the quarter end using the agreement’s reporting window. - Flag any timing risk, including the need for lender notice if a late or corrective filing is anticipated. ## 5. Vertical / structural / temporal relationships - Separate the analysis by reporting period, covenant type, and source document so each row traces to a single control term. - Distinguish present-quarter items from cumulative amounts that roll across quarters or fiscal periods. - Keep current-period addbacks distinct from lifetime or rolling caps; do not mix the periods in a single line. - Where one definition feeds another, preserve the dependency chain explicitly so the workbook can be audited from input to final ratio. - If the agreement uses multiple measurement dates or test points, analyze each one separately rather than averaging across periods. ## 6. Output structure conventions - **Compliance memo (.docx):** concise narrative explaining the source documents reviewed, methodology used, assumptions made, calculation issues found, covenant outcomes, reporting deadline, and any certification caveats. - **Calculation workbook (.xlsx):** include clear tabs for EBITDA reconciliation, debt calculation, each covenant test, sensitivity analysis, and capped-item tracking; formulas should trace from source inputs to final ratios. - **Compliance certificate (.docx):** use an officer-certifiable form that states the tested period, the covenant results, the delivery basis, and any required qualification or reservation language. - Present all calculations conservatively and label every assumption that affects covenant headroom. - If more than one covenant, addback, or debt component is implicated, enumerate each item before analysis and carry each through to a discrete worksheet row. - End the memo with specific recommended actions, each tied to a responsible role and a filing or delivery milestone. - Before finalizing, confirm by name that the memo, workbook, and certificate are all complete, non-empty, and mutually consistent.