OUR PRODUCTS. ARTEMIDA-DIJANA FACTORING - your debtor s discount bill of exchange. HESTIJA-VESTA FACTORING own bond discounting to meet obligations

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2 OUR PRODUCTS PALETTE I: you have turned commercial loan into financial loan: ARTEMIDA-DIJANA FACTORING - your debtor s discount bill of exchange ATENA-MINERVA FACTORING cession sale HESTIJA-VESTA FACTORING own bond discounting to meet obligations PALETTE II: you transform and differentiate commercial loan into particular factoring: HERA-JUNONA FACTORING exclusive account receivables financing; DEMETRA-CESRES FACTORING exclusive account receivables security; PERZEFONA-PROZERPINA FACTORING exclusive receivables management; PALETTE III: you use knowledge, experience and technological services and references of factoring as cash trader, financier and partner; AFRODITA-VENERA FACTORING financing, security and receivables management; ASTARTA-NINA FACTORING comprehensive and long-term defining of procurement and credit sale loan policies

3 JASMINKA d.o.o. Factoring Company Factoring is a system of cessions and assignations specialized in comprehensive and systematic management of procurement and credit sale loan policies with a maturity of one year maximum. Factoring is the guardian of your liquidity, meaning that it: cares about your company s ability to balance and, in the long run, stabilize short-term payment capacity with short-term liabilities; allows your company to meet its daily financial obligations in a timely manner and receive payments free of financial difficulties; allows you to participate in the bargaining system within the economic community; assures your creditworthiness (financial and/or commercial loans included) and capacity to convert your assets into cash (by cession, discounting, advance payments, stock sales, production financing by buyers/creditors, etc.). assures that your goods and their parts convertible into cash are sufficient for meeting your financial obligations and claims; allows you to take and forward available purchase power (creditworthiness, good standing), so you could borrow from your suppliers or lend to your buyers; allows you to establish your creditworthiness within the context of multiple opportunities on the goods-money-loan-trade market (suppliers, buyers, banks, capital market, etc.); enables you to continually deal with the unavoidable issue of optimal amount of working capital to avoid potential risks and panic, at the minimum cost; takes care of your liquidity (in Latin: liquidus) and/or cashing in of accounts receivable and liabilities, entirely or partially, fast and without any loss. PROCUREMENT AND SELLING MARKET FINANCIAL AND LOAN MARKET Image I: Good stranding and borrowing sovereignty

4 Image II: General liquidity Image III: Planning, monitoring and controlling liquidity

5 Factoring is always interesting to and used by: companies whose short-term receivables have not been assigned to a bank or third party companies already parties to loan agreements used for financing machinery, equipment and real property, or having bank as a party to the financing of their lease agreement; companies preparing an investment companied not granted a new short-term loan after cash flow analysis companies which have not been granted a loan by a bank, even though they have offered to provide quality, undue, short-term loans as a security companies aiming to stay sovereign in their relations with buyers in terms of prices companies entering dynamic foreign markets to face unknown competitors; factoring gives them free information on any buyer s good standing companies not employing experts in this field, because their have chosen factoring as a simpler, more professional, faster and cost-efficient solution Image IV: Sources of supply and demand of liquid assets within a company

6 Factoring offers the following advantages: supplier discounts loss reduction due to less uncollected payments reduced costs of gathering information on the clients and claim collection costs lower interest costs due to better and faster cash flow better discounts and purchase prices due to shorter payment terms you are willing to offer to your suppliers saving money on insurance premiums facilitates business activities, in country and abroad better credit rating no need for discounts for advance payments used to attract capital longer payment terms for your clients Image V: Liquid assets storage Image VI: Characteristics of liquid assets

7 CLAIM A Claim is an established or recognized right, by virtue of property-law rules or pursuant to another relationship, to demand from someone the payment of an asset which is due to claimant from that other party based on the supply of product or service performance. A claim is doubtful if there is a possibility that is will not be paid in full or in a timely manner. Disputable claim is when a dispute arises between the claimant and debtor. Long-term claim is a claim with a maturity of not less than one year. Short-term claim is a claim with a maturity of one year maximum. Claims originate due to variable dynamics in the business-law process. The phase of obligation creation and the phase of its fulfillment are not simultaneous, which means that there is a time gap between them. Business affairs wherein both creditor and debtor fulfill their obligations simultaneously are rare. DEFERRED PAYMENT (Credit Sale) Credit sale or deferred payment is the consequence of the time gap between the moment of selling and the moment of paying, which is entered in business books as seller s receivable and debtor s liability. Credit sale is not uniform or legally determined, but varies depending on multiple factors such as industry sector, negotiation skills of the parties to a contract, effectiveness of the collection mechanism, economic relations stability, target market, legislation, judicial system, ability to manage claims and establish efficient sales policy, etc. Company s payment discipline depends on short-term liquidity which differs among companies due to following reasons: different buyer structure, different way of repayment, activity, payment methods, approved deference of payment, etc.

8 Image VII: Liquid asset loaning basic options Image VIII: Liquidity requirements liquidity indicators

9 INVOICE INVOICE (in German: Rechnung) is an itemized bill for goods sold or services provided, containing amounts and unit prices, and the sum the seller is charging buyer for delivered goods, with a detailed description of the applicable terms and conditions (way of payment) and payment due date (payment deadline). Invoice serves as: 1) payment request, 2) accounting document (proper, credible and sufficient for recording a business change) 3) evidence 4) an offer or acceptance (during negotiations) 5) contract renewal by virtue of seller s price specification 6) appropriate instrument for supplementing and specifying terms of contract MONEY Money is actually a claim which involves the payment of money; coins and notes appropriate for buying and selling. Modern functions of money: 1) Money serves as a means of exchange it is used in the exchange of goods and services, thus facilitating, accelerating and enabling trade, that is, the exchange of goods and services on the market. That is the circulation of money. 2) Money serves as a calculation unit to establish prices of goods and services. 3) It is a standard of deferred payment the consequence of the time gap between buying and selling. 4) It enables preserving value for future use.

10 CESSION CESSION (in German: Abtretung, Zassion) is an act by which a transferrable claim is transferred from one creditor (the cedent) to another creditor (the cessionary), whereas the debtor (the cesus) and the claim remain unchanged. Possible legal grounds for cession are contracts, laws and court decisions. Every cession is an accessory contract preceded by another, main contract, so the reasons for such transfer may vary. Cession may be contracted due to debt repayment, purchase, donation, lien, etc. Cession comprises three basic relationships and three parties are involved, even though cession is actually a bilateral relationship: 1) The cedent debtor relationship, wherein the original and the new creditor enter into a cession contract. The debtor does not need to consent to the transfer, but the cedent is obligated to notify him of the same. That notification, except for practical purposes, has legal consequences as well. Before receiving such notification, the debtor can fulfill his obligation only to the cedent, but after receiving it, the obligation can be fulfilled to the new creditor only. In case of multiple cessions (successive cession), if the cedent ceded the same claim to different parties, the priority of notification is crucial, that is, the debtor has to fulfill his obligation to the creditor of whom the cedent notified him first; 2) The cessionary debtor relationship, wherein the cessionary now has the same right, identical in scope and contents, the cedent had before the cession, and next to the main claim, all accessory rights are transferred as well. The debtor can, in addition to objections he can raise against the cessionary, raise all objections he could have raised against the cedent up until the moment of notification; 3) The cedent cessionary relationship depends on whether the cession is against-payment transaction or not, because in the one case the cedent is liable for the verity (trueness, existence) of the claim, that is, guarantees that the claim truly exists, and in the other case the cedent is liable only for its collectability. When cession is an against-payment transaction, the cedent is always liable for the verity, and for collectability when contracted explicitly, and if cession is free of payment he is not liable neither for verity nor for collectability, and cession described in Art. 1-3 is a regular cession (cessio regulare) and provisions prescribing the rules apply to other types of cession as well: cession instead of fulfillment, cession due to collecting and cession as a mean of security. 4) Cession is a civil law institute, and in English law the term assignment is often used to denote a cession.

11 ASSIGNMENT ASSIGNMENT is an instrument of transfer whereby one party authorizes the other party to do something to a third party, debiting first party s account, at the same time authorizing that third party to receive the same as a creditor. There are three parties involved: a person giving authorization (the assignor), the party authorized to do something (the assignment debtor) and the person authorized to receive (the assignee). Assignment is a unilateral act, because unilateral statement of the assignor is sufficient for it to come into effect. It is informal by nature, but, as other commercial agreements, it needs to be in written form. Since assignment has to be accepted by the assignment debtor and the assignee, the statements of all three parties can be set in a single act so, in that case, statements can be given in the form of an assignment contract. Assignment is a document whereby someone is given instruction and someone assigned a right, for it contains two authorizations: one given to the assignment debtor and the other to the assignee. Therefore, there are three legal relationships: 1) The assignor assignment debtor relationship; 2) The assignor assignee relationship; 3) The assignment debtor assignee relationship.

12 WORD GAME Croatian English soap (flatter, soap, to soap) cash (to change) coin (to fabricate, metal money) currency (circulation, lucre) dough (pastry) fund (stock, capital, stake) kale (cabbage, borecole) purse (bag, to pucker, to wrinkle) money (financial, loan) needful (immediately available, required) paper money (notes, bills) rubbish (nonsense, trash, rot, debris, garbage) brass (copper alloy, tablet) calculus (stone) shot (bullet, arrow, shoot, explosion, remark, guess, discharged, hit) sake (cause, purpose, end) reckoning (counting, computation, calculation) receipt (recipe, bill, receiving) note (distinction, message, remark, letter, notification, receipt, cry, tune) score (comma, mark, stroke) computation (calculation, counting) invoice (delivery note, itemized bill, check)

13 JASMINKA d.o.o. Factoring Company JASMINKA d.o.o. is a factoring company always there for its clients so do not hesitate to send us your inquiries about factoring or seek other financial advice.

14 GOJKO MRAOVIĆ o Mob.: o Tel.: o gojko.mraovic@j-factoring.com JASMINKA MILJKOVIĆ o Mob.: o Tel.: o .: jasminka.miljkovic@j-factoring.com SENAD MRAOVIĆ o Mob.: o Tel.: o .: senad.mraovic@j-factoring.com MIRKO MRAOVIĆ o Mob.: o Tel.: o .: mirko.mraovic@j-factoring.com NENAD MRAOVIĆ o Mob.: o Tel.: o .: nenad.mraovic@j-factoring.com JELENA MILJKOVIĆ o Mob.: o Tel.: o .: jelena.miljkovic@j-factoring.com DRAGANA ČIPIĆ o Mob.: o Tel.: o .: dragana.cipic@j-factoring.com KRISTINA ZORIĆ o Mob.: o Tel.: o .: kristina.zoric@j-factoring.com