Explain briefly the working of Moods’s KMV monitor as a monitoring device.

Explain briefly the working of Moods’s KMV monitor as a monitoring device. 

Ans. Moody’s Analytics is a subsidiary of Moody’s Corporation established in 2007 to focus on non-rating activities, separate from Moody’s Investors Service. It provides economic research regarding risk, performance and financial modeling, as well as consulting, training and software services. Moody’s Analytics is composed of divisions such as Moody’s KMV, Moody’s Economy.com, Moody’s Wall Street Analytics, the Institute of Risk Standards and Qualifications, and Canadian Securities Institute Global Education Inc. It suggests a methodology which allows estimating asset values and asset volatilities and thereafter use them for finding default probabilities. It helps to measure and manage risk with greater accuracy. It is a software solution which helps in finding about the expected risk of default.