Using Trade Reference As Part Of Credit Vetting Procedures
In the credit application form we can put a request to the customer for the names of his trade references.
Why is this so? The taking of references has becomingly more common. Seeking trade references can greatly help the credit manager/controller in the credit vetting of his customer. So we should make it as easy or [...]
November 28, 2009
Tags: Credit control, Credit management, trade reference Posted in: CREDIT MANAGEMENT/CONTROL 
No Comments
Why Should Credit Limit Be Imposed.Is it necessary for the company to inform the customer about its credit limit and credit terms?
In credit control or management, it is important to set credit limit for each customer. By setting credit limit, it has the following advantages:
the firm is able to limit its credit risk or losses caused by fraud or a sudden worsening of a customer’s position.
Having credit limit set means that modest check or no check [...]
November 28, 2009
Tags: Credit control, Credit management Posted in: CREDIT MANAGEMENT/CONTROL No Comments
ALL TOPICS COVERED UNDER THE HEADING-CREDIT MANAGEMENT/CREDIT CONTROL
All the topics for Credit Management are segmented into the following sections:-
GENERAL/INTRODUCTION
Credit Management:An overview of Its Importance And Characteristic of a well run credit management department.
Roles Or Functions Of Credit Management
Credit Management-Costs In Extending Credit /Return on Investment on Account Receivables.
Â
ACCOUNTING/DOCUMENTATION
Credit Management-The Importance of Proper Documentation.
Accounting Treatment & Workflow on Write Off Bad Debts and [...]
March 11, 2008
Tags: Credit control, Credit management Posted in: CREDIT MANAGEMENT/CONTROL 17 Comments
Time-The Critical Factor In Credit Control/Management
Needless to say that when debtors are not paying us on time, we need to raise our alertness level as this can ultimately lead to a future bad debt.
So what might be some of the warning signs of a future bad debt?
Some examples are as follows:
longer credit terms taken with approval, particularly for smaller orders
use [...]
July 27, 2007
Tags: Credit control, Credit management Posted in: CREDIT MANAGEMENT/CONTROL No Comments
Use The Corporate Guarantee Form When Granting Credit Facility To Your Customer Who Belongs To A Group of Companies
During the credit vetting process of granting a new credit facility or additional credit amount to the customer, you might notice from the Application Form that a particular customer belongs to a group of companies. You might find that the credit standing based on all your financial and non-financial ratios on this stand-alone company might [...]
April 1, 2006
Tags: corporate guarantee form, Credit control, Credit management, Credit vetting Posted in: CREDIT MANAGEMENT/CONTROL No Comments
Credit Management:What is the KPA and KPI of a Credit Manager?
In my article on the Role of Finance, I have included a topic on Targeted Performance Management (TPM).
By setting targets to the credit personnel employee, this will directly enable the objectives of the company to be achieved. The employee himself/herself will have a better focus and knows exactly what Managements wants from him/her and others.
The [...]
March 28, 2006
Tags: Credit control, credit department kpi, Credit management, What is Posted in: CREDIT MANAGEMENT/CONTROL, Finance Role/KPA/KPI No Comments
Credit Management: Basic Collection Approaches, Types of Defaulters, Delaying Tactics and Signals for Potential Defaulters
Basic Collection Approaches:
There are many ways to try to collect. Do you know them?
Collection approaches can be broadly classified into:
Persuasion, e.g. “Pay now because it’s better for you…â€
Coercion, e.g. “We’ll have to take other forms of action……….â€
Education, e.g. “Your payment isn’t here. It is important to pay because….â€
Problem solving / Emphatic, e.g. “How can we [...]
March 27, 2006
Tags: Collection Approaches, Credit control, Credit management Posted in: CREDIT MANAGEMENT/CONTROL One Comment
