Certainly, the primary goal in any business endeavor is to get customers to increase their orders. But this increase can also be a warning sign and another technique for spotting business credit fraud. In most credit fraud situations, the operator ultimately wants to order as much as possible. The window of opportunity for heavy ordering is often just a few months. Thus, there comes a time in almost every credit fraud when ordering increases drastically. It is simply greed. If they’re going to take the business down, they can’t resist doing it on a big scale. The results are orders that are out of proportion to the size of the business.

Again, like all fraud indicators, a credit analyst can only make use of the indicator in the context of other factors.… Read the rest

Last chance to send in your NACM National Honors and Awards!
Please submit nominations through NACM Oregon. For questions and submissions please contact Brett Hanft, CBA: 503-520-5451 or hanft@lumber.com… Read the rest

Financial statements play an extremely important role in the day-to-day operations of a business. The balance sheet provides a snapshot of the company’s financial statement, while the statement of cash flows shows its operating expenses. It is vital for a credit professional to review and understand these documents. The credit manager should also be aware of the 10 associated elements in financial statements that relate to measuring the performance and financial position of the business.

1. Assets—All of the resources owned, or in some cases controlled, by a company or a person
2. Liabilities—obligations, debts, and items that are owed by the business
3. Equity—assets minus liabilities
4. Investment by owners—an increase in the equity of the business; something of value is transferred to the business to obtain or increase ownership interest
5. Distribution to owners—a decrease in the equity of business after assets of some kind, such as cash, are transferred to the owners
6. Comprehensive income—all of the changes in equity during a stated period, except changes from either investments by or distributions to owners
7. Revenues—cash or other items received by the business in exchange for merchandise or services rendered
8. Expenses—the amount of assets or services spent or used
9. Gains—increases in a company’s equity from non-operating business transactions, except those that stem from revenues or investments by owners
10. Losses—decreases in a company’s equity from non-operating business transactions and other occurrences, except those that stem from expenses or distributions to owners

Source: NACM, Principles of Business Credit

Posted January 2016… Read the rest

We had a blast at the Holiday Open House a few weeks ago! Thank you for everyone who came to join the fun. We look forward to seeing everyone next year. Play the video below to see all the fun and excitement!

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