Debt purchaser Pioneer Credit has entered into a standstill agreement with its senior financiers, Bankwest and Westpac, giving the company some breathing space before lenders take action over defaults.The company's circumstances have deteriorated over the past few weeks. On September 2, Pioneer warned it was at risk of breaching a financial covenant under its senior financing facility.The cause of the problem was a material difference in the company's expected net profit for 2018/19 due to the classification and measurement of its financial assets at amortised cost.The company adopted an amortised cost classification for valuing its purchased debt ledger during the 2018/19 financial year. It said: "While the amount and timing of cashflow recognition does not change under either fair value of amortised cost classification, the outcomes of the application of discount rates arising under the various modelling options can produce changes to the timing of reported profit."On September 2, it said the likely material difference in EBIT "could result in a breach of a financial covenant".According to the latest update, no repayment or penalty interest is required until October 14, giving the company time to "implement the preferred solutions of the company".Pioneer has appointed Azure Capital to assess proposals received for the realisation of the value of its assets, including change of control proposals, and for the provision of alternative funding if required.It said one of its financiers had informed it that it would not be extending its facility beyond the March 2020 expiry date.The company has not yet released its financial report for the year to June.