CA-5.8.107
Past version: Effective from 01 Apr 2008 to 31 Mar 2011
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The bank must have clear and effective policies and procedures governing the control of receivables, credit, and cash. In particular,
(a) Written internal policies must specify all material elements of the receivables purchase programme, including the advancing rates, eligible collateral, necessary documentation, concentration limits, and how cash receipts are to be handled. These elements should take appropriate account of all relevant and material factors, including the seller's/servicer's financial condition, risk concentrations, and trends in the quality of the receivables and the seller's customer base.
(b) Internal systems must ensure that funds are advanced only against specified supporting collateral and documentation (such as servicer attestations, invoices, shipping documents, etc.).
Apr 08