Invoice finance & factoring
The mechanics of invoice finance & factoring
A practical guide to the operation of invoice finance and factoring.
The workshop will provide attendees with a practical understanding of how invoice finance and factoring operate, the key risk considerations, eligible transactions, funding prepayment, the nature of dilutions and retentions, and security, both from a users and financiers perspective.
The intermediate course also provides a more detailed review of facility agreement clauses, dealing with insolvency of the client, recoveries and an opportunity to participate in role play.
Entry level 1 day, intermediate level 2 days
Who Should Attend?
Companies, bankers and financiers, lawyers, and accountants.
The course is suitable for everyone involved in the raising and financing of sales invoices – to include sales, finance, operations, credit control, administration, credit risk and compliance.
- Types of invoice finance and factoring and how they work
- Key variants:
- Availability of finance
- Bad debt protection (with or without recourse)
- Notice to debtors (disclosure/non disclosure)
- Sales ledger administration
- Risk assessment; client, debtors, reservation of title, terms & conditions of purchase and sale
- Understanding key limits; MAFIU, buyer, funding, dilution and debt turn
- Documentation; proof of delivery/collection, audit trail and relevance of Incoterms® 2010
- Working with credit insurance
- International factoring and special considerations
- Survey/audit assessment*
- Operation of sales ledger control, client account, current account and trust accounts
- Security structure, waivers, priority agreements and assignment of debts
- Dilutions and retentions
- Restrictions (ineligible debts)
- Calculation of prepayment availability
- Key facility covenants, warranties, undertakings and termination events*
- Facility breach and implications
- Operational fees and charges and penalty for early cancellation
- Insolvency of the client and recovery of debts*
- Role play*
*Intermediate course only