SAQA All qualifications and part qualifications registered on the National Qualifications Framework are public property. Thus the only payment that can be made for them is for service and reproduction. It is illegal to sell this material for profit. If the material is reproduced or quoted, the South African Qualifications Authority (SAQA) should be acknowledged as the source.
SOUTH AFRICAN QUALIFICATIONS AUTHORITY 
REGISTERED UNIT STANDARD: 

Establish the security cover over the factoring liability provided by debtors in factoring 
SAQA US ID UNIT STANDARD TITLE
12735  Establish the security cover over the factoring liability provided by debtors in factoring 
ORIGINATOR
SGB Banking and Micro Finance 
PRIMARY OR DELEGATED QUALITY ASSURANCE FUNCTIONARY
BANKSETA - Banking Sector Education and Training Authority 
FIELD SUBFIELD
Field 03 - Business, Commerce and Management Studies Finance, Economics and Accounting 
ABET BAND UNIT STANDARD TYPE PRE-2009 NQF LEVEL NQF LEVEL CREDITS
Undefined  Regular  Level 4  NQF Level 04  15 
REGISTRATION STATUS REGISTRATION START DATE REGISTRATION END DATE SAQA DECISION NUMBER
Reregistered  2018-07-01  2023-06-30  SAQA 06120/18 
LAST DATE FOR ENROLMENT LAST DATE FOR ACHIEVEMENT
2024-06-30   2027-06-30  

In all of the tables in this document, both the pre-2009 NQF Level and the NQF Level is shown. In the text (purpose statements, qualification rules, etc), any references to NQF Levels are to the pre-2009 levels unless specifically stated otherwise.  

This unit standard does not replace any other unit standard and is not replaced by any other unit standard. 

PURPOSE OF THE UNIT STANDARD 
This unit standard is intended for individuals in a credit and sales function in factoring.

Persons credited with this unit standard will be able to demonstrate knowledge and understanding of key financial concepts associated with evaluating the stability of a business, analyse audited management accounts to establish the financial stability of the business in its current trading position, evaluate business deterioration or growth, evaluate the quality of debtors as a form of security for the advance and evaluate the effectiveness of actual security cover over the factoring liability 

LEARNING ASSUMED TO BE IN PLACE AND RECOGNITION OF PRIOR LEARNING 
There is open access to this unit standard. 

UNIT STANDARD RANGE 
Range: any trading company with a minimum turnover of R3 -5 million

Range: nature and stability of the supplier's turnover, total credit exposure

Range: VAT, Tax, PAYE, UIF, Medical Aid, Pension payments and other state and municipal payments. 

Specific Outcomes and Assessment Criteria: 

SPECIFIC OUTCOME 1 
Demonstrate knowledge and understanding of key financial concepts 
OUTCOME NOTES 
Demonstrate knowledge and understanding of key financial concepts associated with evaluating a business's stability. 

ASSESSMENT CRITERIA
 

ASSESSMENT CRITERION 1 
1.The concept of solvency and insolvency of a business is explained in own words using examples according to generally accepted financial principles. 

ASSESSMENT CRITERION 2 
2.The concept of liquidity in a business is explained in own words using examples according to general financial principles. 

ASSESSMENT CRITERION 3 
3.The concept of profitability in a business is explained in own words using examples according to general financial principles. 

ASSESSMENT CRITERION 4 
4.The concept of gearing in a business is explained in own words using examples according to general financial principles. 

ASSESSMENT CRITERION 5 
5.The concept of over and under capitalisation in a business is explained in own words using examples according to general financial principles. 

ASSESSMENT CRITERION 6 
6.The concept of the relationship between capital and long-term loans to finance the non-current assets to be explained in own words using examples according to general financial principles. 

ASSESSMENT CRITERION 7 
7.The theoretical requirements to establish the viability of factoring as an appropriate form of finance are explained in own words according to the company's factoring and credit policy. 

SPECIFIC OUTCOME 2 
Analyse audited management accounts to establish the financial stability of the business in its curr 
OUTCOME RANGE 
: Any trading company with a minimum turnover of R3 -5 million. 

ASSESSMENT CRITERIA
 

ASSESSMENT CRITERION 1 
1.The effectiveness of the business's solvency is established in terms of analysis of the current management accounts according to accepted financial principles. 

ASSESSMENT CRITERION 2 
2.The effectiveness of the business's liquidity is established in terms of analysis of the current management accounts according to accepted financial principles. 

ASSESSMENT CRITERION 3 
3.The effectiveness of the business's profitability is established in terms of analysis of the current management accounts according to accepted financial principles. 

ASSESSMENT CRITERION 4 
4.The effectiveness of the business's current gearing is established in terms of analysis of the current management accounts according to accepted financial principles. 

ASSESSMENT CRITERION 5 
5.The business's current level of capitalisation and long-term loans is established in terms of analysis of the supplier's audited and current management accounts according to accepted financial principles. 

SPECIFIC OUTCOME 3 
Evaluate business deterioration or growth 

ASSESSMENT CRITERIA
 

ASSESSMENT CRITERION 1 
1.The circumstances denoting business deterioration or growth are identified and explained in own words in terms of analysis of the current management accounts according to accepted financial principles. 
ASSESSMENT CRITERION RANGE 
Nature and stability of the supplier's turnover, total credit exposure.
 

ASSESSMENT CRITERION 2 
2.The risks associated with the business's cash flow are identified and explained in own words in terms of analysis of the supplier's cash flow according to accepted financial principles. 

ASSESSMENT CRITERION 3 
3.The risks associated with the supplier's creditors turnover are identified and explained in terms of analysis of creditor payment patterns according to payment terms established with the creditors. 

ASSESSMENT CRITERION 4 
4.The business's compliance with statutory payments is evaluated according to records of payments made and amounts outstanding in line with the statutory requirements. 
ASSESSMENT CRITERION RANGE 
VAT, Tax, PAYE, UIF, Medical aid, Pension payments and other state and municipal payments.
 

ASSESSMENT CRITERION 5 
5.The business's regular payment of critical overheads is evaluated according to records of payments made and amounts outstanding. 

SPECIFIC OUTCOME 4 
Evaluate quality of the debtors as a form of security for money advanced 

ASSESSMENT CRITERIA
 

ASSESSMENT CRITERION 1 
1.The reliability of debtor's payment patterns is established according to the supplier's debtors age analysis. 

ASSESSMENT CRITERION 2 
2.The creditworthiness of the debtors is evaluated in the manner required by the company. 

ASSESSMENT CRITERION 3 
3.The spread of business risk across the debtors is evaluated according to the supplier's debtor's age analysis. 

ASSESSMENT CRITERION 4 
4.The regularity and volume of trade is evaluated according to the debtor's age analysis. 

ASSESSMENT CRITERION 5 
5.The value of individual debtors in relation to the debtor's book as a whole is established according to the debtor's age analysis. 

ASSESSMENT CRITERION 6 
6.The tenure of debtor relationships with the supplier is evaluated according to the supplier's debtor's age analysis. 

SPECIFIC OUTCOME 5 
Evaluate the effectiveness of actual security cover over the factoring liability 

ASSESSMENT CRITERIA
 

ASSESSMENT CRITERION 1 
1.The overall business's stability is evaluated based on an integration of the analysis of solvency, liquidity, profitability, gearing, capitalisation and the business's requirement for finance. 

ASSESSMENT CRITERION 2 
2.An assessment of the business's deterioration or growth is prepared based on an integration of the analysis of turnover, current credit exposure, creditor's turnover, cash flow and statutory payments. 

ASSESSMENT CRITERION 3 
3.The assessor's views/ comments regarding the quality associated with the debtor's book are specified according to the analysis of the book in line with the lender's factoring policy. 

ASSESSMENT CRITERION 4 
4.The assessor's views/ comments regarding the quality and amount of cover the debtor's book would provide are specified according to the analysis of the book in line with the lender's factoring policy. 

ASSESSMENT CRITERION 5 
5.Other available security is assessed according to the lender's credit policy. 

ASSESSMENT CRITERION 6 
6.The assessor's views/ comments/ opinions regarding the safety of the monies advanced (or to be advanced) are reported based on integration of analysis of financial stability, business growth or deterioration, quality of debtors and evaluation of security taken/ available according to the lender's credit policy. 

ASSESSMENT CRITERION 7 
7.The amount of finance the lender would be comfortable with lending, is specified in terms of the integrated analysis according to the lender's credit policy. 


UNIT STANDARD ACCREDITATION AND MODERATION OPTIONS 
1.Anyone assessing a learner against this unit standard must be registered as an assessor with the relevant ETQA.
2.Any institution offering learning that will enable achievement of this unit standard or assessing this unit standard must be accredited as a provider with the relevant ETQA.
3.Moderation of assessment will be overseen by the relevant ETQA according to the moderation guidelines in the relevant qualification and the agreed ETQA procedures.

Therefore, anyone wishing to be assessed against this unit standard may apply to be assessed by any assessment agency, assessor or provider institution that is accredited by the relevant ETQA. 

UNIT STANDARD DEVELOPMENTAL OUTCOME 
Demonstrate knowledge and understanding of key financial concepts associated with evaluating a business' stability

Analyse audited management accounts to establish the financial stability of the business in its current trading position

Evaluate business deterioration or growth

Evaluate quality of the debtors as a form of security for money advanced 


Critical Cross-field Outcomes (CCFO): 

UNIT STANDARD CCFO IDENTIFYING 
  • To identify and solve problems when the effectiveness of the business's solvency, liquidity, profitability, gearing and capitalisation are established and explained. 

  • UNIT STANDARD CCFO ORGANISING 
  • To organise and manage oneself and one's activities responsibly and effectively when 

  • UNIT STANDARD CCFO COLLECTING 
  • to collect, organise and critically evaluate information when the assessors' views regarding the safety of monies advanced are reported based on an integration of analysis of financial stability, business growth or deterioration, quality of debtors and evaluation of security taken. 

  • UNIT STANDARD CCFO DEMONSTRATING 
  • To demonstrate an understanding of the world as a set of related systems when the concepts of solvency and insolvency, gearing, liquidity and profitability are explained. 

  • REREGISTRATION HISTORY 
    As per the SAQA Board decision/s at that time, this unit standard was Reregistered in 2012; 2015. 

    UNIT STANDARD NOTES 
    Legal Requirements

    All procedures must meet recognised codes of practice as well as obligations required by current legislation within South Africa and within the normal parameters of the defined job/task.

    Terminology

    Offer - a term used to refer to the invoices presented to a factoring house for discounting

    Supplier - A term used in factoring to refer to the party who supplies the invoices for discounting. The term is used to distinguish this party from the terms used for debtors and creditors.

    Security - This a term used to refer to assets that can be attached in order to provide recourse in the event of a loss incurred by the lender. 

    QUALIFICATIONS UTILISING THIS UNIT STANDARD: 
      ID QUALIFICATION TITLE PRE-2009 NQF LEVEL NQF LEVEL STATUS END DATE PRIMARY OR DELEGATED QA FUNCTIONARY
    Elective  20185   Further Education and Training Certificate: Banking  Level 4  NQF Level 04  Reregistered  2023-06-30  BANKSETA 


    PROVIDERS CURRENTLY ACCREDITED TO OFFER THIS UNIT STANDARD: 
    This information shows the current accreditations (i.e. those not past their accreditation end dates), and is the most complete record available to SAQA as of today. Some Primary or Delegated Quality Assurance Functionaries have a lag in their recording systems for provider accreditation, in turn leading to a lag in notifying SAQA of all the providers that they have accredited to offer qualifications and unit standards, as well as any extensions to accreditation end dates. The relevant Primary or Delegated Quality Assurance Functionary should be notified if a record appears to be missing from here.
     
    1. Absa Learning & Development 
    2. Bidvest Bank 
    3. Chartall Business College 
    4. Cornerstone Performance Solutions (Pty) Ltd 
    5. Felix Risk Training Consultants 
    6. Firstrand Bank - Benmore 
    7. Nedbank Ltd 
    8. The Facilitation Workshop 



    All qualifications and part qualifications registered on the National Qualifications Framework are public property. Thus the only payment that can be made for them is for service and reproduction. It is illegal to sell this material for profit. If the material is reproduced or quoted, the South African Qualifications Authority (SAQA) should be acknowledged as the source.