Don’t Take Receivables at Face Value
Feb 01,2018
Don’t take receivables at face valueBorrowers often use accounts receivable as collateral for their loans. But how can you ensure that your borrower’s receivables are truly collectible amounts? Lurking beneath the surface may be significant problems that, if not addressed, may lead to default. Do your research and get to know the warning signs that may indicate accounts receivable weaknesses — or even fraud. Evaluating qualityAccounts receivable represent the amount of money that customers owe a borrower for purchases. If a borrower pledges receivables as collateral to qualify for a loan or line of credit, lenders typically claim them to cover losses if the borrower defaults on repaying its debts.Poorly maintained or fraudulent balances hobble the lender’s ability to recover losses, however. That’s why the quality of receivables is important.When evaluating the quality of receivables for a new or existing borrower, begin by computing the days sales outstanding (DSO) ratio. This...
How to Protect Yourself Against Taxpayer Identity Fraud
Oct 18,2017
In light of the recent issues surrounding identity theft and cybersecurity, Smith & Howard would like to offer some tips to protect your credit and your federal tax account from fraudulent tax returns. Residents of Georgia, Florida and the District of Columbia may participate in an IRS pilot program and apply for a special identification number called an IP PIN. An IP PIN is a unique six-digit number assigned by the IRS to prevent others from filing a fraudulent return using your social security number.Note: If you have already frozen your credit, you will need to unfreeze it temporarily to create this IP PIN. We also recommend that you enroll in credit monitoring, if you haven’t already done so.Instructions for obtaining an IP PIN from the IRS can be found here.Other things to note on taxpayer ID fraud and the IP PIN:The IP PIN is a unique number that is...

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