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Factoring |
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Factoring Factoring The act or practice of selling a firm's accounts receivable to a third party, known as a factor. If a firm is not confident in its ability to collect on its credit sales, it may sell the right to receive payment to the factor at a discount. The factor then assumes the credit risk associated with the accounts receivable. This allows the firm access to working capital immediately, which is important especially if the firm might otherwise have a cash flow problem. The price of factoring is determined by the creditworthiness of the firm's customer, not of the firm itself. It is also known as accounts receivable financing. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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| An alternative option that is already succeeding is the factoring of invoices and receivables. But its lawyers are seeking class action status and those involved in the factoring industry are paying close attention. Factoring a large number to determine its prime-number components typically takes a long time -- so much time on even the fastest available computers that an important method of encrypting digital information can count on the difficulty of factoring for maintaining security However, factoring techniques have improved sufficiently in recent years to bring numbers of more than 100 digits easily within range. |
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