I must say, there has been some brilliant analysis on this by both bulls and bears.
The complexity of the coverage ratio in the facility does leave the liability on BIG up for question. I subscribe to the hypothesis of the opening post, that the $20m facility is essentially a revolving facility for working capital, and acts as a form of invoice financing for BIGs behalf. This does leave debtor risk on BIGs plate, rather than the client, but the product is clearly sound and has attracted a wide client base both locally and internationally.
Whilst unconventional and aggressive, it has provided BIG with the short term finance it requires to fund the expense of the videos, before drawing in the customer receipts.
However I am happy to be proven wrong and eat my humble pie here. If the $20m facility acts as a overflow facility against a much bigger $57m ($20/0.35) "loan" that is essentially the debt of the customer but to be serviced by BIG, then that would indicate a very high reliance on the facility to fund the business. And would bring the entity to it's knees if that was the case imo.
But then that doesn't make sense either, as BIG have just recently gone on record saying that they are "not dependant on the arrangement for achieving future growth on a sustainable basis". And this very line is what had supported a bullish outlook on the company by many here when it dropped to $1.60 and then rallied.
Put it this way...
There'll be a lot of heat on the auditor, because that half year balance sheet is going to make light on a lot of this.
And if there is something off here, there would have been telltales in the 2017 FY balance sheet.
And if there has been an oversight in there then ASIC will come down hard on the auditor imo.
All fun and games. Hope noone is overexposed either long or short here