Factoring is a type of transaction where an entity sells it customer receivables to a financial intermediary who then in turn collects payment from the entity’s customers. Many entities employ this strategy to accelerate cash collection. This course provides an overview of the accounting and reporting requirements with respect to accounts receivable factoring programs as well as the conditions that must be met in order to recognize the transfer of these financial assets as a “true sale” instead of a secured borrowing.
Course Publication Date:
October 20, 2022
This course is available with
NO ADDITIONAL FEE if you have an active
self study membership or
all access membership or can be purchased for
$20.00!
| Author: | Kelen Camehl |
| Course No: | ACT-CASHFAC-25002 |
| Recommended CPE: | 2.00 |
| Delivery Method: | QAS Self Study |
| Level of Knowledge: | Basic |
| Prerequisites: | None |
| Advanced Preparation: | None |
| Recommended Field of Study: | Accounting
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Learning Objectives
- Recognize key characteristics as well as advantages/disadvantages of factoring arrangements.
- Identify the U.S. GAAP area applicable to factoring arrangements.
- List the three specific conditions that must be met for a factoring arrangement to qualify as a sale.
- Recognize key evaluation considerations relating to true sale opinions.
- Identify examples of continuing involvement.
- Recognize the impact from a failed sale in a factoring arrangement.