PBS College (Pty) Ltd is accredited by the South African and the International Institutes of Credit Management to offer this course via distance learning. To view further details of the course, kindly visit the website of the Institute of Credit Management South Africa. ([email protected])
Any person who is in possession of a Matriculation certificate, or who has had at least two years practical experience in a Credit Department, may enrol for this Part of the course. The course is taken over one full semester, with external examinations written in June and November of each year.
Learners studying through this college are provided with all the study materials needed to complete the course. Learners must submit assignments which are marked and returned to the learner via e-mail.
On obtaining a minimum average of 50% for ALL assignments, the learner is allowed to write the examination.
On successfully passing the examination, the learner is awarded a PBS College certificate for Part One and a letter of credit for the Part from the relevant Institute. After completing Part Three, the learner is awarded the prestigious Certificate in Credit Management by the Institute.
COURSE FEES:
The cost of the course is R4 100, 00. In addition to this fee, learners must pay R440,00 examination fee as well as R226,00 membership fee to the Institute (this may be paid to the college for onward transmission to the relevant Institute).
The following is a broad content of the syllabus for Part One of the course:
1. Definition of Credit
2. Forms of Credit:-
Definitions, sectors affected and the role of the economy of:-
Consumer credit
Commercial Credit
Export / International credit
Government credit
Banking credit
Agricultural credit
3. Sources and role of Credit:-
(i) Controls, functions, products and responsibilities of:-
Commercial Banks
Merchant Banks
Finance Houses
Factoring Houses
South African Reserve Bank
Land Bank
Small business development corporations
Micro lenders
(ii) The role of Credit in business:-
Cash cycle and the use of credit in business
Advantages and disadvantages of offering credit
Cost of Credit to a business
Chain of distribution and the varying credit requirements
(iii) The role of Credit in the life of a consumer:-
Benefits and dangers in using credit
Understanding consumer rights and obligations
(iv) The role of Credit in the economy:-
Understanding the various pressures and economic influences - Legislation
Social obligations
International
Political
Technological
Brief overview of the impact of the excessive use of credit on the economy
(v) Definitions of Credit Terminology:-
Open Account (include risk and ownership)
Installment Sale Agreements (include risk and ownership)
Leasing and Rental Agreements
Revolving Credit
Credit worthiness
Purchasing Power
Credit Redemption
Credit Volume
Credit Limit
Cash Cycle
Credit Risk
Credit Service
Profit
Over-trading
Liquidation
Sequestration
Conditions of Sale
Credit terms
Credit period
Trade Discount
Settlement Discount
Age Analysis
Overdue Report
Days Sales Outstanding
Forward Buying
Consignment Stock
Cash flow
Bad debts
Finance charges
Penalty charges
Interest
Interest rates
Jurisdiction
Domiciled
Seasonal dating
(vi) Payment Terms and factors influencing them:-Cash with Order
Cash before delivery
Cash on delivery
Specific days from date of invoice
Specific days from date of statement
Load over Load
Sold on Consignment
Sight draft
Installments
4. Internal Credit Environment:-
(i) Functions of a Credit Department:-
New Account Assessments
Account maintenance
Collections
(ii) Credit Policy:-
Definition
Role and use of the Policy
Basic Contents of the Policy
(iii) Credit Evaluation:-
The 7 C?s of Credit:-
Character
Capacity
Capital
Collateral
Credit History
Conditions
Common Sense
The role of the 7 C?s in determining risk:-
Consumer
Commercial
(iv) Consumer Assessments:-
(a) Gathering Information
Credit Applications and Credit Agreements
(Open accounts, cash loans and installment )
(Which information is asked for and why)
Credit Bureau
(include the role of the bureau and consumer information)
Trade References
(which ones to use, and information to be obtained)
Employment Verification
Deeds Office
Government Gazette
(b) Value of Personal Interviews
When are they used
How are they conducted
What role do they play in the assessment process
(c) Evaluating the Risk
Manually:-
Using the 7 C?s of Credit
Scoring:-
Manual Scoring using:-
Contactability
Salary confirmation
Credit Bureau listing
Electronic Scoring using:-
Information weightings based on past bad debt history and industry
trends
(d) Decision Making and Credit Limit setting
Manual system
Scoring System
(v) Commercial Assessments:-
(a) Sources of Information
Credit Application Forms + Conditions of Sale
(Importance of information obtained - including understanding all forms of
business ownership and the legal set up requirements thereof)
The Role of the following non-financial sources in
Commercial Credit:
Credit Bureaus
Director Links and past history
Trade References
Salesman?s Report
Bank Codes and Reports
Deeds Office
Government Gazette
Newspapers
Industry Share Groups
Professional Institutions
Competitors
(b) Evaluating the Risk using the 7C?s of Credit and the non-financial information
gathered.
(c) Setting a credit limit:-
Basic method - :
taking customer requirements, terms and credit worthiness.
(vi) Collections
(a) Importance of prompt collections
Cost of overdue accounts
Cost of bad debt write-offs
(b) Payment Methods:-
Negotiable Instruments:-
Bills of Exchange
Promissory Notes
Cheques - Endorsements and
Restrictions
Post dated Cheque
Acceleration Clause
Telegraphic and electronic transfer
Postal Orders
(c) Collection Objectives
(d) Collection Procedures Policy
Definition
Format
Internal and External influences
Content
(e) Target setting for individual collectors
Categorize debtors - using:-
Age
Amount
Payment history
(f) Collection Tools
Age Analysis
Exception Reports
Facsimile
Letters
Telegrams
Statements
3rd Party collections - ADRA and Code of Ethics
(g) Differences between consumer and commercial collections
(h) Measurement of Effectiveness
Time, Value and productivity
(vii) Debtors Administration
Maintaining the account
Understanding debits and credits
Credit and debit notes - authority levels and allocations
Journals - Credit and Debit
Importance of keeping an "open to buy' situation
Banking procedures and balancing
Data Capturing and balancing
Reconciliations - Open Item and Balance brought forward
Cash Sale Reconciling
Masterfile maintenance and authority levels
Filing systems and the importance thereof
(viii) Inter-departmental Co-operation
Introduction to Company and departmental objectives
The obligations of the credit personnel to other departments
The obligations of other departments to the credit personnel
Importance of Team strategy
5. Introduction to the Basic Law of Contract
(i) Law of Contract
Definition of a legally binding contract - verbal or written
Exceptions to the above criteria
(ii) Contract of Sale
(iii) The National Credit Act
6. Supervisory Skills
Role of the Supervisor:-
Obligations to Management
Obligations to staff - basics of Plan, Lead, Organize and control
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