1 Discounting, Factoring & Forfeiting Introduction Bill Discounting Factoring- Meaning & Definition Modus Operandi Terms of Agreement Functions Types of Factoring Factoring Vs Discounting Cost of Factoring Format of Cost Sheet Accounting System & Procedure Benefit Factoring in India International Factoring Types of Export Factoring Factoring in other Countries Forfeiting Factoring Vs Forfeiting Advantages of Forfeiting Forfeiting in India
2 Introduction In India due to economic liberalisation & free trade policy the financial service sector is developing at a faster rate. Financial institution try to extend their axis trace to trading community through book debt financing. In coming chapter we are going to get information on three types of book debt financing viz. Bill Discounting, Factoring & Forfeiting.
3 Bill Discounting This is a old & more usable type of book debt finance in India. A Bill Discounting is type of finance where seller draws bill on purchaser who accept it & return to seller. Seller then goes to his bank & discounted it. In this case seller gets immediate cash, purchaser have not need to pay immediately & Banks who pays the cash receives interest for the period for which the bill is drawn. So in short Bill discounting is a type of one of the most quick liquid finance.
4 Bill Discounting From the banking point of view Bill discounting is very safe, secure & liquid finance. If in case of emergency the bills which has been discounted by seller, can be rediscounted with R.B.I. & Bill discounting is again superior to traditional cash credit in following ways: a) Liquidity b) Quick Finance c) The bills are always drawn with recourse so all parties on instrument are liable till the bill is finally discharged.
5 Factoring Meaning & Definition The word factor has been derived from the Latin word means to make or to do. In other words to get things done. As we seen invariably in small & medium scale companies the problem of working capital. This is due to large buyers procrastination. Factor plays important role for these small & medium scale companies.factoring is nothing but selling of trade debts at a discount to financial institution. The definition of factoring according to V.A.Avadhani, factoring is a service of financial nature involving the conversion of credit bills into cash.
6 Modus Operandi So factor provides finance to his client known as factoring. The Modus operandi of factoring scheme are: There should be factoring agreement. The client should prepares invoice in his usual way. The goods are sent to buyers without Bill of exchange but but Invoice.
7 Modus Operandi The debt due by purchaser to client is assigned to factor by advising the customer, to pay to the factor. The client hand over the invoices to factor along with receipted delivery challans, or copies of LR/PR etc. Factor makes an immediate payment up to 80% of invoice value & the balance 20% after realisation of debt.
8 Terms of Agreement The important part of factoring is an agreement between client & factor. Following are some main points of the same. Assignment of debt in favor of factor. Selling limits for the client. Condition of recourse. Details of services offered by factor & payment for same. Interest to factor on the accounts where credit allowed by seller to supplier.
9 Functions The terms of agreement that lights on functions of factor. The main function of factor is to provide finance I.e. purchase & collection of debts but along with that factor provides other services those can be brief as below. 1. Sales Ledger Management: This is very important function of factoring. Because when factor offer service, it is his responsibility to maintain sales ledger & keep track of payment made by customer.
10 Functions 2. Purchase & Collection of Debts: Factor provides immediate finance up to 80%. Thus the collection of that invoice is his duty. 3. Undertaking of Credit Risk: This is also another function which is very important. As you learn factor provide spot finance, so he has to closely monitor customer s financial position, his past performance and his honesty etc. 4. Provision of Finance: As stated earlier factor provide immediate finance to client. The client concentrate more on additional business activities available.
11 Types of Factoring After seeing functions now lets see the different types of factoring which varies on the basis of the nature of transactions between clients & his factor, volume of business. following are some of the main types of factoring. 1. Full Service Factoring: As the name suggest, it is type where factor offers all services viz.providing finance, administration of sales ledger, collection of debts. This is called a standard factoring practice.
12 Types of Factoring 2. With Recourse Factoring: In this type factor does not bear the credit risk. If debtors unable to pay their dues & if the same is unpaid for beyond a fixed period, the same is automatically assigned back to client. 3. Bulk Factoring: It is also called as Notified Factoring or Disclosed Factoring because factor provides finance after disclosing the fact of assignment of debts to the debtor concerned. The management of sales ledger & credit control has to be done by client himself.
13 Types of Factoring 4. Maturity Factoring: Under this type factor does not provide immediate cash payment to the client. He undertakes to pay as & when collection made from the debtor. 5. Invoice Factoring: In this type factor simply provides finance against invoices without undertaking any other function. The debtors are not notified about finance so it is also called as as Undisclosed financing.
14 Types of Factoring 6. Agency Factoring: Under this type the work is shared by both client & factor. The client has to maintained sales ledger & collection work & factor as to provide finances assuming credit risk. 7. Invoice Factoring: As the name suggests it is nothing but service of factor extended from domestic market to international business. this factoring is facilitated with the help of import factor & export factors.
15 Factoring Vs Discounting As stated earlier the venture capital took roots when comptroller of capital issues raised guidelines for the same. The some of them are: Point Factoring Discounting Coverage Covers all debts Covers only those debts of a client. which are backed by A.R. Scope The scope is vast. The scope is limited to i.e.maintain sales provide finance against ledger, credit risk, the discounted bills provision of finance. Only.
16 Factoring Vs Discounting Point Factoring Discounting Recourse Factor may extend It is always made with credit without any recourse to the client. recourse. Present- It is Known as It is Known as ation Off-B/s finance. In-B/s finance. Ownership Factor becomes The financer is an the owner of value. agent not owner.
17 Cost of Factoring Cost of factoring comprises of two aspects viz. finance charges & service fees. Generally, the factor charges a service fee on the total turnover of the bills, it is around 1%. If the bills paid earlier, the charges could be reduced. Finance charges are normally same as interest charged by bank. While the pricing of factoring services, following components should be taken into consideration. 1) Factoring Fees 2) Discount Charges Former comprises of sales ledger, credit control & bad debts administration. Later is for providing instant credit to the client.
18 Format of Cost Sheet The costing of factoring service is very important. Following is the format of cost sheet for the same. A. Direct Cost Per Invoice amount.. Per active account. Per Debtor account. Per Client account. % of turnover Bad debt provision. % of turnover Total of Direct Cost B. Administrative Cost.. % of turnover C. Total Factoring Cost = A + B D. Profit = % of turnover E. Required factoring charges = ( C + D) x 100 Total turnover
19 Accounting System & Procedure Normally factoring company keeps following for accounts to record factoring transactions. Sales Ledger Control A/c Debt Purchase A/c Client Current A/c Bank A/c Out of which A/c a & b must be maintained separately for each customer. The accounting procedure involves following main entries at different stages.
20 Accounting System & Procedure When Invoice are assigned Sales ledger control A/c To Debt Pur. A/c When 80% Payment made Client current A/c To Bank A/c Dr. Dr. When Payment made by Debtors Bank A/c To Client Current A/c Debt. Pur. A/c To Sales Led. Control A/c When Credit Note are assigned Debt. Pur. A/c To Sales Led. Control A/c Dr. Dr. Dr.
21 Benefits 1. Financial Service: In the current market situation & payment trend, we often see many of the traders & manufacturers being blocked their working capital in trade debts. Factoring provides instant finance & hence it gives opportunity to client to concentrate on other business activities. 2. Collection Service: This is one of the best benefits to client. It is found that total 60% of sales by SSI sector is in the from of credit sale. So collection of debts become vital for this sector. Now by factoring this tension passes from client to factor, leads to more time for client to concentrate on production etc.
22 Benefits 3. Credit Risk Service: In the absence of factor, the entire risk is on the shoulder of client. The bad debts take away the profit of concern & in some cases leads to winding up of organisation. But with the factoring, now entire risk is borne by factor. Client is assured of complete realisation of book debts without tension. 4. Sales Ledger Management Service : Maintenance of Sales Ledger is soul of business. It requires expertise persons to do it, which the every client may not have. Factoring helps client by sending him monthly sales, collection analysis etc.
23 Benefits 5. Consultancy Service: Normally, factors are professionals in offering management services. They collects information about credit worthiness of the customers, ascertain track record etc. Thy also advice clients on import finance matters. 6. Economy Services: Factors are able to serve economically as they have number of clients & so they can spread their overheads between all of them. So every client get service at lower cost. The interest rate charged on 80% of amount so factoring may considered cheap source of finance compare to others.
24 Benefits 7. Off-Balance Sheet Financing: Factoring considered as off - B/S finance. As this finance never appear in liability side of B/S & this will improve current ratio of company. Let s take on example to make this point clear. Suppose the B/S of Well Pack shows: total of assets side 15 lakhs, comprises of debtors Rs.6,00,000, stock Rs.6,00,000 & other assets Rs.3,00,000. The debit side shows: loan against stock Rs.4,00,000 & otter loan against Bills Rs.4,00,000, other liability Rs.3,00,000 & Net working capital Rs.4,00,000. From above, The C.R. of the firm is 1.36 : 1 Now if debtors are purchase by factoring agent, he pays 80% instantly so company gets Rs.4,80,000, which is used to pay of bank loan. Now the revised position of Well Pack is as below: Asset: stock Rs.6,00,000, debtors Rs.1,20,000. The C.R. of company is 1.65 : 1
25 Factoring in India In India the idea of factoring services was first thought of by the Vaghul Working Group. The R.B.I. Constituted study group in Jan under chairmanship of Mr. C. K. Kalyanasundaram & on recommendation of the committee, the Banking Act was amended in July 1990 with a view to enabling commercial banks to take up factoring services through their subsidiaries.
26 Factoring in India In Feb R.B.I. Permitted all banks to enter factoring business departmentally. In India the factoring services firstly started by S.B.I. in association with small Industries Development Bank,Union Bank, State Bank of Sourashtra & State Bank of Indore. The factoring company founded by SBI called SBI- Factors & commercial services Pvt. Ltd. (SBI- FACS) with capital of Rs.25 crores in 1991.
27 International Factoring Just like domestic suppliers, the exporters also finds difficulty in receiving payments. That is why factoring services not only popular in domestic business but also they are gradually entering into export business. the International factoring has been define as, an arrangement between factor &his client which includes at least two of the following services provided by factor. i) Finance ii) Maintenance of A/cs iii) Collection of debts iv) Protection against credit risk. Although from definition, the international factoring look same as domestic factoring, it is different in respect of type of export factoring & the arrangement made by the exporter & factor.
28 Types of Export Factoring In the absence of export factoring all export transactions are backed by letter of credit. Factoring is done entirely on the basis of invoice prepared by the exporter, so it is purely an Invoice based export finance technique. There are normally four types of export finance. Two factor system: There are two factors. One is in the exporter's country & other in importer s country. The exporter never sends goods to importer before factoring relationship established.
29 Types of Export Factoring Single factor system: Under this system also two factors involve. But the responsibility of making payment maintaining books is with export factor. To cover credit risk export factor enter into agreement with import factor. Direct export factor system: In this, the agreement is made between the exporter & the export factorno other party involved. The entire risk is to be borne by export factor. Direct import factor system: This is just opposite of the previous one. The agreement made between exporter & import factor in the import country. The import factor shoulders all the risk.
30 Factoring in Other Countries Factoring in European countries have option to finance both domestic & export business. but though business condition & continued recession have effected the factoring business. Now more than 700 factoring companies are operating in forty countries. Italy occupies 1 st position in terms of factoring business volume, followed by USA. The U.K. stands 3 rd in the rank. Japan, Marico, France, Netherlands join the suit after.
31 Factoring in Other Countries The world factoring turnover is explain in the following table. Name No.of Factoring Turnover % Share Companies ($ billion) in world factoring Italy U.K U.S.A Mexico Japan France Netherlands Germany South Korea Sweden Others
32 Factoring in Other Countries The year wise factoring turnover shows consistent improvement in factoring. With the help of following graph it is very much clear that factoring has an upward trend in improvement, both in domestic & international. In the last 6 years, the total of factoring have been improved from 103.8$ Billion to 260.0$ Billion(estimated). Which itself a clear indication of upward trend, same the case with international factoring.
33 Forfeiting As we are coming to end of the chapter, this is a third type of financing against receivables like factoring. This technique is helpful to exporter for financing goods exported on medium term deferred basis. The term Forfeit is French word means to give something or give up one s right. In Forfeiting, exporter give up his right to receive payment in future for immediate cash payment by forfeiter. The definition says, the non-recourse purchase by a bank or any other financial institution, of receivables arising from an export of goods & services.
34 Factoring Vs Forfeiting Both factoring & forfeiting are tools of financing. Some basic differences can be made as follows. Points Factoring Forfeiting Terms Short term financing Medium term financing Scope Both domestic as well It is invariably employed as International. In export business. Services Not only arrangements of Only financial aspect that finance but also sales ledger to only particular export maintenance, consultancy. bill. Finance 80% on the spot, balance 100% on the spot. 20% after receiving payment.
35 Advantages of Forfeiting It is very clear from previous comparison, that though forfeiting & factoring are tools for financing, the actual use of them is made as per requirement. Means if you want to export some goods, you should go for forfeiting & not for factoring & vis-a-vis. Following are some of the advantages of forfeiting. Profitable & Liquid: From the point of view of exporter as well as forfeiter, this is most liquid & profitable because forfeiter not only get immediate cash as from discount charges, but he can sell the same in secondary market.
36 Advantages of Forfeiting Simple & Flexible: From the point of view of exporter, this tool of finance is simple & flexible, as he & forfeiter can decide the term according to the needs of each other. Avoid Export Credit Risk: The exporter is completely free from credit risk, that nay arise out of possibility of interest rate fluctuations etc. Avoid Export Credit Insurance: If exporter does not wish for forfeiting, he has to go for export credit insurance. Which is sometime involve very rigid procedure as well as costly. But in case of forfeiting he need not bare any such expenses.
Chapter 7 Discounting. Factoring & Forfeiting Summary The financial service sector is developing at rapid pace in India. This is just because of the emerging needs of the economy. Many innovative schemes
LESSON 13: FACTORING THEORETICAL FRAMEWORK Lesson Objectives To understand the Concept of Factoring. Methodology of Factoring and Forfeiting. Types of factoring. Introduction Receivables constitute a significant
Learning Objectives: Factoring To explain nature, function and types of factoring. To dilate upon modus operandi of factoring. To bring out potentiality of factoring as a source of finance. To highlight
THE CONCEPTUAL FRAMEWORK OF FACTORING ON SMALL AND MEDIUM ENTERPRISES Minaxi Rani Assistant Professor (Extn.), Department of Commerce, Govt. College for women P.G. College, Hisar, Haryana, (India) ABSTRACT
Management of Accounts Receivable Meaning & Definitions Aspect of Credit Management Objectives of Accounts Receivables Management Advantages of Trade Debtors Management Costs of Maintaining Accounts Receivables
International Trade Financing and Risk Management Manual Website: www.aepcindia.in For query please contact: Ms. Vanni Mehta, firstname.lastname@example.org Incorporated in1978, (AEPC) is the official body of apparel
EXPORTER S SOUK EVENT FOUR SEASONS 4/23/2015 1 FACTORING Factoring is a financial transaction whereby a company sells its receivables to a Third Party (Factoring Company) at a discounted rate. Not a loan
A STUDY ON THE PERFORMANCE ANALYSIS OF FACTORING SERVICES IN INDIA Dr. K. N. KALAIVANI Dr. S. Gopalraju Government First Grade College, Anekal, Bangalore 562 106 E-Mail: email@example.com ABSTRACT
FACTORING AND FORFEITING the faster way to get your money 3 CONTENTS FACTORING 4 DOMESTIC FACTORING 5 1. Supplier s factoring (Reverse factoring) 5 2. Selective factoring with right of recourse 6 3. Individual
COMMERCIAL PAPER (CP) CP is an unsecured money market instrument issued in the form of a Promissory Note and was introduced in 1990. Can now be issued in Dematerialised form. To enable highly rated corporate
Factoring and Forfaiting -A fund/fee based financial service Prof. Nishant Dhruv, What is Factoring? Definition: Factoring provides resources to finance receivables as well as facilitates the collection
Factoring Services S Balasubramanian, Vice President (Finance) & Company Secretary, Canbank Factors Ltd., Bangalore. Realisation of outstanding dues is increasingly becoming a complicated and tedious exercise.
. ESTIMATES OF EU TURNOVER VOLUMES. Turnover volumes by product, allocation and notification (Estimates of EU s, Millions of ) Estimate of the EU % on Turnover Significance of the sample on total turnover
Sustainable financing solutions at times of crisis How to finance your business through factoring? Bucharest, October the 6-th, 2009 Dan Stoica, RomFactor 1 Agenda What is happening with companies in the
INVOICE DISCOUNTING, FACTORING & SALES LEDGER MANAGEMENT Selling your sales Invoices or outsourcing your sales ledger is one of the most complex techniques for business finance. Unfortunately, it is often
PRESENTATION ON FACTORING BY GLOBAL TRADE FINANCE LIMITED 19.06.2007 o Incorporated in March 2001 o o o o ABOUT GTF India s first International Factoring Company RBI has accorded registration and Authorised
FACTORING Pen Pusher FACT1 A company is considering engaging a factor. The following information is available: a) The current average collection period for the company s debtor is 80 days. ½% of debtors
Incisive Guide to Factoring Factoring Guide Summary This guide from Incisive outlines the features and benefits for your business from using factoring and invoice discounting services. Factoring is commonly
The World of (International)Factoring Facts & Figures Different Products The Two-Factor System The Role of IFG Erik Timmermans Secretary General IFG 1 Evolution of World Factoring Turnover 1980 : +/- 50
NATURE OF FACTORING www.factors-chain.com/home www.factoring.org A US DEFINITION: a continuing arrangement between a factoring concern and the seller of goods or services on open account, pursuant to which
FACTORING IMPROVE YOUR CASH FLOW & SECURE YOUR DEBTS Presented by Gregory Bernardi FACTORING AGENDA What is factoring? How does it Work? Who can use factoring? Advantages/Benefits How much does it cost?
Flashcards for Chapter 6 Introduction to Working Capital Management [ ] [Type the abstract of the document here. The abstract is typically a short summary of the contents of the document. Type the abstract
IFCI Factors Limited SME: Finance -Challenges & Opportunities- Factoring Services- A non-conventional option 1 India s SME Scenario Indian SMEs account for almost 45 percent of industrial output and 40
It is concerned with decisions relating to current assets and current liabilities Best Buy Co, NA s largest consumer electronics retailer, has performed extremely well over the past decade. Its stock sold
Credit Insurance of Mitsui Sumitomo Insurance I Benefits of MSI Credit Insurance Payment condition is usually a critical key for international trade competition. Advance Payment or Letters of Credit (L/C)
First column=preferred terms. Bold and italics signifies other defined terms. Bold signifies alternate terms used. 1= Governance; 2=Facilities and Products; 3 Charges; 4 Legal terms and security arrangements;
7 Management of Working Capital BASIC CONCEPTS AND FORMULAE 1. Working Capital Management Working Capital Management involves managing the balance between firm s shortterm assets and its short-term liabilities.
Unit 6 Receivables 7-1 Receivables - Claims resulting from credit sales to customers and others goods or services for money,. Oral promises of the purchaser to pay for goods and services sold (credit sale;
WELCOME! Introduction Celebrating Ethe Factor Network establishment of &PrimeRevenue PrimeRevenue Hong Kong 2012 PrimeRevenue, Inc. Global Reach Today, we transact business in 50 countries Our platform
CORPORATE ACCOUNTING CORE COURSE BCom (2011 Admission) III SEMESTER UNIVERSITY OF CALICUT SCHOOL OF DISTANCE EDUCATION Calicut University P.O. Malappuram, Kerala, India 673 635 329 UNIVERSITY OF CALICUT
Bill Discounting While discounting a bill, the Bank purchases the bill receivable to the Exporter (i.e. Bill of Exchange or Promissory Note) before its due date and credits the value of the bill to the
Roll No : 1 : 373 Time allowed : 3 hours Maximum marks : 100 Total number of questions : 7 Total number of printed pages : 7 NOTE : 1. Answer FIVE Questions including Question No.1 which is compulsory.
Paper 5- Financial Accounting Academics Department, The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) Page 1 Paper 5- Financial Accounting Full Marks:100 Time allowed:
Factoring and forfaiting 1 Factoring Factoring is a transaction where the exporter sells its receivables to an institution The factoring institution buys the receivables without recourse Due to increased
The Cost-Effective Cash Flow Solution for Your Business Providing working capital for business Your invoices represent one of your most valuable business assets however, until they are paid, they are not
OVERSEAS TRADE FINANCE ( OTF ) Port to Port Trade Finance Trade Finance Equity Trade Finance Report 3 Port to Port Trade Finance Trade Finance Equity Overseas Trade Finance specialise in sourcing trade
Accounting Fundamentals Lesson 5 5.0 Receivables & Investments Short-term investments (also known as marketable securities) are easily convertible to cash that a company plans to hold for a year or less.
Understanding Invoice Finance Introduction John Mackey Senior Business Development Manager Ronan Horgan Managing Director Content What is Invoice Finance? Industry Background Who can avail of Invoice Finance?
Trading Profit and Loss Account Trading Account The trading account shows the income from sales and the direct costs of making those sales. It includes the balance of stocks at the start and end of the
THE WORKING CAPITAL CYCLE IN INTERNATIONAL TRADE Introduction The working capital cycle is the period of time which elapses between the points at which cash is used in the supply/production process, to
East Lancashire Chamber of Commerce International Trade Club - 20 July 2010 Export Finance & Introducing Chamber Invoice Finance Nigel Mills Director Strategic Markets Nigel Crosse Head of International
Factoring and Forfaiting Chapter XII Factoring and Forfaiting After reading this chapter, you will be conversant with: The Concept and Mechanics of Factoring and Forfaiting Different Types of Factoring
Accounts Receivable Finance IMM Financial offers an Accounts Receivable Finance or Program based on eligible Domestic or International Accounts Receivables. For Accounts Receivable to be eligible, they
ACCOUNTANCY SECTION A QUESTION NUMBERS 1 10 TOTAL MARKS 16 CHAPTER 1 SINGLE ENTRY SYSTEM 1.What is Single Entry System of Book keeping? Accounting records which are not maintained according to double entry
practical information hermes cover special Refinancing of officially supported export receivables march 2012 practical information hermes cover special Refinancing of officially supported export receivables
Your guide to our services Working together to help your clients Bibby Financial Services works with a strong and diverse network of financial intermediaries, such as finance brokers, insolvency practitioners,
www.xtremepapers.com UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS International General Certificate of Secondary Education MARK SCHEME for the May/June question paper for the guidance of teachers
www.xtremepapers.com UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS International General Certificate of Secondary Education MARK SCHEME for the May/June question paper 0452 ACCOUNTING 0452/03 Paper
8 Steps for Analysing Listed Private Equity Companies Important Notice This document is for information only and does not constitute a recommendation or solicitation to subscribe or purchase any products.
Model Answer M.Com IV Semester Financial market and financial services Paper code- AS 2384 1. (I) Money Market is a market for short term loans or financial assets. As the name implies it does not deal
MODULE - 6A Cash Flow Statement 30 CASH FLOW STATEMENT In the previous lesson, you have learnt various types of analysis of financial statements and its tools such as comparative statements, common size
Factoring in the 21st Century The economic relevance of factoring and trade finance in Europe May 2013 1. What is factoring? 2. Who are factoring clients? 3. European factoring market and future trends
It is concerned with decisions relating to current assets and current liabilities Best Buy Co, NA s largest consumer electronics retailer, has performed extremely well over the past decade. Its stock sold
Chapter 2: Major Sources of Financing Solutions to Chapter Review Questions 1. Debt finance available in Australia: Trade Credit Bank Overdraft Trade Bills Promissory Notes Commercial Bills Inter-Company
Debtor Management (Relevant to PBE Paper II Management Accounting and Finance) Eric Y.W. Leung, CUHK Business School, The Chinese University of Hong Kong Accounts receivable forms quite a significant part
CENTRE FOR CONTINUING EDUCATION BBA (AVIATION OPERATION) BATCH: SEMESTER: NAME: ROLL NO: ASSIGNMENT 1 & 2 FOR BUSINESS ACCOUNTING BBCF 131 UNIVERSITY OF PETROLEUM & ENERGY STUDIES Assignment-1 Note: All
Accounting for Share Capital 1 LEARNING OBJECTIVES After studying this chapter, you will be able to : explain the basic nature of a joint stock company as a form of business organisation and the various
www.xtremepapers.com UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS International General Certificate of Secondary Education MARK SCHEME for the October/November 2010 question paper for the guidance
Working Capital Introduction to the Management of Working Capital AS & A2 Business Studies PowerPoint Presentations 2005 Introduction All businesses need cash to survive Cash is needed to: Invest in fixed
BANKING UNIT POLICY DOCUMENTS POLICY DOCUMENT ON THE REGULATORY PROVISIONS FOR THE UNDERTAKING OF LENDING ACTIVITIES BY INSTITUTIONS AUTHORISED UNDER THE FINANCIAL INSTITUTIONS ACT 1994 FACTORING FORFAITING
Company Registration No. 01095795 (England and Wales) UNAUDITED ABBREVIATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2014 CONTENTS Page Abbreviated balance sheet 1 Notes to the abbreviated accounts
EDI LCCI IQ ON DEMAND AWARD IN BUSINESS FINANCE AND BANKING OPERATIONS SAMPLE LEVEL 4 MARKING SCHEME DISTINCTION MARK 75% CREDIT MARK 60% PASS MARK 50% TOTAL 100 MARKS QUESTION 1 (a) Inventory days Receivable
Chapter 07 - Accounts and Receivable I. Accounts Receivable A receivable is an amount due from another party. Accounts Receivable are amounts due from customers for credit sales. A. Recognizing Accounts
Factoring: An Alternate Payment Method in International Trade Surendar Vaddepalli Research Scholar, Dept. of Business Management, Osmania University, Hyderabad, firstname.lastname@example.org Abstract Factoring
Unit 1 Accounts of the sole trader This unit consists of one section only: Section 1: Final accounts Section 1 Final accounts By the end of this section you should be able to: explain the position of a
CHAPTER 7 ACCOUNTING FOR SHARE CAPITAL (Share and Share Capital : Nature and types) A Company is an artificial person created by law, having separate entity with a perpetual succession and a common seal.
Management of Receivables Different costs involved in maintaining the debtors: 1. Interest. 2. Discount. 3. Collection Charges. 4. Bad Debts. Different approaches of calculating Interest: Total Cost approach.(priority)
FORFAITING A USER'S GUIDE WHAT IT IS, WHO USES IT AND WHY? By: John F Moran, Jr. Abstract Italian and West German exporters have long been familiar with Forfaiting and still provide the bulk of the market.
CURRENT RECEIVABLES Receivables are the amount owed to the organization by its customers and/or others. Current receivables will be collected within one year or the current operating cycle which ever is
Receivables Management Paper-3 Part-II Financial Management Chapter-7 Unit-IV By: CA Kapileshwar Bhalla Learning Objectives What is Receivables Management Review of Credit Policy What is Factoring Practical
INSTITUTE OF ACTUARIES OF INDIA CT2 Finance and Financial Reporting MAY 2009 EXAMINATION INDICATIVE SOLUTION General guidelines to markers: The solutions provided here are indicative ones. Please award
Factoring as an Alternative Trade Finance Instrument in a Competitive World 22 November2013 Peter Brinsley Director, POINT FORWARD LTD Peter Brinsley - credentials 21 years in factoring Now a freelance
1. INTRODUCTION CORPORATE MEMBERS OF LIMITED LIABILITY PARTNERSHIPS 1.1 This note, prepared on behalf of the Company Law Committee of the City of London Law Society ( CLLS ), relates to BIS request for
5 Types of Financing BASIC CONCEPTS 1. Sources of Funds 2. Categories of Sources of Funds There are several sources of finance/funds available to any company. Some of the parameters that need to be considered
Trade Credit Practice, UK MANAGING TRADING RISKS THROUGH THE ECONOMIC RECOVERY OCTOBER 2013 CONTENTS The trading landscape for UK based companies... 1 Payment default and bad debt... 2 Insurance benefits...
B.Com. Part-I : Financial Accounting Sem.-I : Unit-2 Amalgamation of Partnership Firms 0. Objectives - After studying this unit, you will be able to : 1. Understand the concept of Amalgamation of Partnership
www.xtremepapers.com UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS International General Certificate of Secondary Education MARK SCHEME for the October/November question paper 0452 ACCOUNTING 0452/03
Chapter 3 How Securities are Traded Primary vs. Secondary Security Sales Primary: When firms need to raise capital, they may choose to sell (or float) new securities. These new issues typically are marketed
Fundamentals Pilot Paper Skills module Financial Management Time allowed Reading and planning: Writing: 15 minutes 3 hours ALL FOUR questions are compulsory and MUST be attempted. Do NOT open this paper
To: European Commission Directorate-General for Financial Stability, Financial Services and Capital Markets Union Kraainem, 24 June 2016 Object: DG FISMA Consultation paper on further considerations for
GCE Accounting Advanced GCE Unit F013: Company Accounts and Interpretation Mark Scheme for January 2012 Oxford Cambridge and RSA Examinations OCR (Oxford Cambridge and RSA) is a leading UK awarding body,
Cash Flow Statement: Comparative Analysis of Financing, Operating and Investing Activities. Ajay G. Paliwal 1 Mukesh B. Ahirrao 2,Dr. V.S.Rana 3 1 Management Student, M.B.A Dept, S.S.B.T s College of Engineering
2015 End of Year Seminar Exam Engage Education Foundation Units 3 and 4 Accounting Practice Exam Solutions Stop! Don t look at these solutions until you have attempted the exam. Any questions? Check the
Accounting, CPT Chapter 6 CA PRATHAP SS INTRODUCTION Preparation of Final Accounts is the last phase of the Accounting Process. INTRODUCTION The process of accounting starts from Transaction then entered