Factoring | CS/CA Inter, CA Final SFM (Old Syllabus)
#Factoring, #ReceivablesManagemnt, #WorkingCapitalManagement, #CAInterFM, #CSExecutiveFM
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Factoring is an arrangement were a firm appoints an agent known as “Factor”, who would collect the outstanding balances from the debtors of the firm and the firm will pay commission or fees for such services.
The factor may also advance money to the firm at a predefined interest rate and therefore the factor will earn interest income on the amount advance.
Generally the factor will maintain a margin or a reserve while advancing the money to the firm.
For example, if debtors balance is ` 10,00,000, the factor is retaining a margin of 20%, then the factor will provide an advance of ` 8,00,000 to the firm.
Types of Factoring:
1. Non- recourse Factoring
2. Recourse Factoring
Under a Non- recourse Factoring, if there is any loss arising from bad debts, such loss will be borne by the factor.
Under a Recourse Factoring, the bad debts losses are borne by the firm itself.
Generally the commission rate is higher in a non-recourse arrangement.
Important Notes:
1. If the question uses the language like, “the factor agrees to buy the receivables of the firm” or “the firm sells its receivables to the factor” then it is implied that all risks and rewards associated with receivables have been transferred to the factor.
This implies that the factoring is on non-recourse basis.
2. Generally in a factoring arrangement, the factor might recover fees and interest upfront, i.e., at the beginning of the arrangement. In such case, the factor will adjust the amount advanced which will be reduced by such upfront fees and interest.
3. Sometimes there may be an offer of advance by bank and the firm has to decide, whether to accept the arrangement offered by factor or the advance offered by bank.
Пікірлер: 89
Thank you sir providing us with this wonderful class . Never in the 44 minutes did I feel bored rather I was more excited to go to the next level
It feels like a live session, even we forget it's an lecture. It's a perfect revision helping to recollect each and every points within a short span of time. Since the concepts are made clear at the beginning, practical problems can be approached and cracked in an easy way. I suggest every commerce students to watch this video to get the utmost clarity about factoring. Thank you sir for this wonderful and meaningful class☺
@sworld1264
3 жыл бұрын
Very true... Even I felt same... Thanks a lot sir🙏🙏
You are true godsend sir.You have get all the qualties of a good teacher..you don't just teach, you are making a road ahead.... You make the concepts crystal clearly. Just amazing
may not have always shown it, but I’m grateful to have had such an awesome teacher like you. Thank you for all the wisdom you shared and setting a great example.🙏
Sir, you truly care about your students.we can feel your support.your expertise in teaching has put our minds ease.
The concept of factoring illustrated in a practical light, in the best possible way👍... Was able to absorb every bit of it... Thank You sir..
This whole entangled mesh of *FACTORING* has been precisely untied by equal portions of undying sincerity and immense knowledge. Thank you sir.
Any other class I would hear henceforth would be criticized using this as a Reference point. Infact I wouldn't need another consultant for this topic!! Thank You NJ SIR.
"Simplifying something is an art and u are the picasso of it"
A mediocre teacher tells , a good teacher explains and a superior teacher inspires ....and u possess all the qualities... It says that " if u cannot explain something simple enough for everyone ..then u have not understood it well enough....but only u can make it such simplified...simplifying something is a great art and u are the master of it ...."
This video has one of the best quality in both visual and sound. The clarity in speaking and use of simple language makes it even more understandable . Adding to the quality is the pictorial representation of concept, working out of questions and better presentation of answers which would be much helpful in examination point of view. Provides conceptual clarity in areas of factoring, re-course and non-recourse basis, upfront interest method etc. Well explained.This video assure a real- in class live effect.. ! Thnq u #SFMGURU
The concept of factoring made by you more effective.👍
I would suggest everyone who faces pressure in the concept of factoring to watch this video, where the facts and concepts are presented and explained in a very simple manner, easier to understand with diagrams & pictures and sweet way of teaching. Concept of Factoring is 100% clear with the additional questions, helpful in examination point of view. Plus point to that, is the real in-class effect, far above virtual classes. The audio & video quality is great!! This video session gave a boost to my confidence level! Thank You Sir🙏🏻 Watch it, understanding factoring will be crystal clear
I am now easly able to crack any question that arises out of factoring as your class portrays the concept of factoring in the simplest way possible...
Factoring now made extremely easy by u sir. for a self study student like me... .. Thank U very much... Grp 2 clrd... only Grp 1 left to become CA
This is the first online lecture video which I have watched till the end.this video is more like a virtual class thank you so much sir...........🙂
Very simple and understandable style of teaching sir..thnk you
It was an awesome time watching this video....great help. Got grip on this topic factoring.....thanks a lot.
Concept of factoring was explained in its best way....... That everyone could easily understand it.
Awesome, every time I left this topic, never knew it could be this simple..!! Best video on factoring..thank you Sir
Sir , this was a well structured and engaging class on factoring . In 44 minutes, you managed to explain the nitty gritty of how factoring works! And has also covered all types of problems in the examination point of view . Looking forward for more such videos . 😄👍
Thank you sir, well explained the meaning of factoring and problems
Gurur brahma, gurur vishno, gurur devo maheswara.... guru sakshal parabrahma, thasmai sree guruve namah..... Bharatheeya culture places guru / teacher at par with god... becoz teacher helps an illterate disciple to gain knowledge & realise god... When I watched ur youtube channel on *Finance Management* I thanked the almighty for giving me a chance to attend your classes... indeed it was a dream come true for me... because I could pick up even the smallest & minute points from your classes... now I am sure that I can crack the CA exam with your blessings sir... Thank you sir & keep up the great work.. the CA student fraternity needs great masters like you..... jai hind... 🌹 🌹🌹🙏
It is impossible to thank ....there are no words to appreciate...... because your classes & way of lectures are helping me to solve problems in the way of concepts ways & not in the way of byhearting I expected more class ....
I really appreciate your effort to make everyone ward study even in these kind of pandemic situation we are facing.
great class sir........As always Lecture is in such a manner that ANY student who wish to learn could easily understand. thank you sir
Thank you sir .. Concepts as well as problems are well explained.it made understanding easier..calculations are also made clear like how each amount is is derived or from where it is taken. Just like classroom learning. REALLY WORTH OF 45 MINUTES even during these exam times 👍👍👍👍👍👍👍
Thank you sir.. You are making the concepts to reside within ourselves,So that we won't forget it... You are making FM interesting
Thank you sir. In less time you taught all what is required to solve ques
I learnt more from this video, than in university class. Thank you.
Thank you so much sir... Your way of explanation is outstanding I heard before.. You made the whole concept of factoring more easy to understand.. Practical problems can be solved more accurately in less time, because the concept is very clear
Factual facts for Factoring to follow, feeling formidable....👨🏻🎓👨🏻🎓👨🏻🎓👨🏻🎓
Thank you so much sir for your well defined explanation about factoring. You really helped me a lot, when i was struggling about on this topic. Now factoring become very easy topic to me. This is an awesome video. "You are a master of simplification. " Because your way of teaching is very simple and understandable. Before watching your video, i thought that factoring is a tough area in finance. But you made it very easy to me to catch the concept. It is really worth of 44 minutes even during these exam time. You are doing a great job sir. You are teaching from the HEART and not from your books. It's a better quality needed for all teachers. You are really a GOD's gift. Not every teacher deserves to be called that one bcoz that title is reserved for great ones like YOU. Expecting more videos of you. May God bless u sir. Thank you.. 🙏🙏🙏🙏
You truly are SFM guru. Great video sir.
Within a quantum of time the lecture has enabled to make out a clear conceptual understanding about 'Factoring' . Even the complicated fragments seems to be much easier . Expecting more videos from you, sir...
It's feel like one to one class or personal tution. Factoring become very easy and we'll explained sir ..... expecting more videos ...... Thank you sir for making factoring simple . . . കൊള്ളാം.....❤️❤️❤️
Very helpful video Got a clear picture about the topic factoring and the questions covered all the major areas Thankyou sir
Thank you sir ...You have made the concepts really clear for me and this level of clarity that you provide every time inspires me to learn more and more about FM .
Very clearly understood the concept of factoring sir!!
Very nice explanation. I understood in one go.thank you so much sir
Your explanation level is very high, every students get understand it... Thank u sir 🌷🌷
Sir, The topic gives me a clear cut meaning....the video helps to recollect the points in a quick span of time... presenting in image helps to recollect the meaning of factoring.........after the completion of factoring topic in lecture the practical problems gives an idea.....now after watching this video it is very easy to find the solution in a short span ...after hearing lecture in class watching in KZread also gives a live clss..... This video really helps me to understand the topic in a lively manner Thank you sir
Thank you so much sir 🙏🙏. You explained the concept in lucid language 🔥🔥🔥🔥. Thank you so much sir 😇
Thank you Sir, well explained
Great work Sir !! Actually you created a peaceful atmosphere for travel through the concept...and I'm enjoyed the journey so well..also, no one forget a beautiful journey.. Thank you Sir !!!
Super sir pls make more videos it's very helpful to a finance students
Well understood by ur explanation
गुरुर्ब्रह्मा गुरुर्विष्णुः गुरुर्देवो महेश्वरः । गुरुःसाक्षात् परब्रह्म तस्मै श्रीगुरवे नम: ॥ You made me very clear about the calculation part of factoring account receivables. I'm very much obliged to you if you upload Equity Valuation full series.
Factoring, a financial arrangement which you have made crystal clear and simple to every listener..But one significant thing which is repeating itself is an arrangement which provides for earning source for third party or parties like banks or other financial institutions. All is happening under one roof but in different forms and roles..The ultimate purpose is to ease financial transaction smooth in financial world.
Life savior...
Very amazing classes sir.....thanku so much..😊
Thank you Sir🙏
Thank you so much
Thank you sir for this wonderful class....no one can simplify this concept the way you have done it...Now factoring became a memorable concept in my mind...it's because of the style of your teaching.....Once again thank you so much for this valuable knowledge...
Thank you so much sir💯
Yes sir doubt cleared in ur further questions explained....
Best explanation on youtube .... I've gone through many but you explain it the best sir...thnx a lot for your examples.. Just one question sir when the fees and interest charged upfront on non-recourse basis,thn why the factors are reserving 10% or 20% as reserve..
You explained the concept of factoring in its best way sir.... got an excellent clarity in this concept sir.... NOW, I have a confidence that I can crack any question in the concept of factoring sir..... thank you so much for simplifying the concepts like this......
Tysm sir❤️❤️
Thank you sir
Super explanation tq you so much sir
Sir ur Teaching level is Awesome thanks for this wonderful Lecture😊
Soo good.. 🖤
Great pedagogy sir
Thank you so much sir
Thank you Sir.... Your Teaching style and Concept clearing way is so helpful to us.. Great effort sir.. Thank you so much sir for this useful and amazing lecture.... ☺️
Great help Thank you sir
#SFMGURU THANK YOU SIR
Sir pls bring portfolio management classes also ASAP
Thank you so much sir...any hindi medium student can understand very easily
everything was effective sir but it would have been great if you have added the question in which both recouse and non recourse factoring have been involved.Thankyou sir
Ty sir
Sir, why effective cost of factoring > interest rate is preferable?
Last problem net annual cost amounts to 927200..sir..final answer is right..
Sir i think if u added the upfront interest calculation's explanation a little more detail too.. this would have been a complete lesson for factoring in all aspects and also i found a simple arithmetical error on the net annual cost calculation in the last question of the session.
Sir... The efforts and dedication you put in is worth admiring and we students really enjoy your way of teaching... The detailed conceptual clarity given is really helpful in not only solving the problems but also understanding its practical application.That is the exact reason why we are enthusiastic to attend your classes :) This lecture was interesting as usual and now, the concept of FACTORING is perfectly clear.Thanks a lot Sir🙌 Eagerly waiting for the upcoming classes...!
Simple, accurate and to the point. A seemingly complex topic simplified such that anyone can understand....... Thank you for making life a lot more easier sir.......
FM from the beginning never been a burdened subject, it has always been a subject which I learn with lots of happiness only bcoz sir you have made this subject lovable by the way of your sublime teaching, it's really heartwarming to be a part of your class sir.... Waiting to hear loads and loads of your lecture sir.... Thank you so much for you efforts for all of us sir.... Love you lotttssss sir....
Superb
No doubts...All clear...
Sir, is this video will also be useful for elective paper- "Financial services and Capital Market " as per CA FINAL New syllabus? Because there is a last chapter in such Elective paper which is "Chapter-17 Factoring " as per ICAI module. Sir, please reply as I have already started watching this video and I am also getting conceptual clarity. I am eagerly waiting for your reply.
Nice
Sir I think there is some mistake in calculations in first question which u explained.... the amount recd by us from factor is net on Fees & interest so we need to calculate our cost of funds on actually recd & not on receivable of 9 Lkhs... ICAI has also been doing cost calculations on actually received.... Logically it sound more appropriate... Pls advice what I should do... take as per u show or as per Logical as ICAI showed.... Awaiting ur early reply. As I also have my exam in May 2019.....
@anjaligupta7084
4 жыл бұрын
Sir thank you so much for the videos. These are really helpful 😊
Super sir
Iska Hindi mai hai kya plz bataye
Any Ksians ?