Maricopa Community Colleges  MGT176   19886-20086 
Official Course Description: MCCCD Approval: 07/22/08
MGT176 19886-20086 LEC 2 Credit(s) 2 Period(s)
Fundamentals of Credit Management
Historical roots and role of commercial credit, the credit function in financial management, determination of credit policies and procedures, and administration of credit departments. Introduction of sources of information for financial analysis.
Prerequisites: None.
Go to Competencies    Go to Outline
 
MCCCD Official Course Competencies:
 
MGT176   19886-20086 Fundamentals of Credit Management
1. Trace the historical development of commercial credit from its beginning to the present. (I)
2. Describe the role of commercial credit in the business environment. (I)
3. Identify the role of control systems within the credit process cycle. (II)
4. Discuss the credit function in the overall process of financial management. (II)
5. Summarize the methods necessary to establish general policy and procedures in a credit department, including credit and collection policy. (III)
6. Review various credit department operations and training methods. (IV)
7. Outline the credit process cycle including investigation methods, decision-making techniques, and establishing a line of credit. (V)
8. List sources of credit information used to assist in financial evaluation/analysis. (VI)
9. State the importance and function of the four "C's" (character, capacity, capital, Business Conditions) of credit management. (VI)
10. Identify the legal forms of business organization. (VI)
Go to Description    Go to top of Competencies
 
MCCCD Official Course Outline:
 
MGT176   19886-20086 Fundamentals of Credit Management
    I. Commercial Credit
        A. Historical Development
        B. Role
          1. Components
          2. Credit vs. Cash
          3. Credit Sources
          4. Credit Types
          5. Credit Chain
          6. Bank vs. Commercial Credit
        C. Credit Associations
          1. Types
          2. Function
        D. Relationship to Business
        E. Risk Factors
      II. The Credit Function
          A. Credit in Financial Management
          B. Credit Flow
            1. Goals
            2. Organization
            3. Control
          C. Role of Credit Department
            1. Policy
            2. Administration
            3. Credit Approval
            4. Accounts Receivable Administration
            5. Collections/Adjustments
        III. Policy and Procedures
            A. Credit Department
              1. Credit Manager's Role
              2. Interdepartmental Relationships
              3. Credit Department Organization
              4. Department Structure
            B. Credit Policy
              1. Definition
              2. Formulation
              3. Dissemination
              4. Review
            C. Collection Policy
              1. Strict Analysis
              2. Liberal Analysis
          IV. Credit Department Administration
              A. Personnel
                1. Job Descriptions
                2. Levels
                3. Performance
                4. Promotions/Pay
              B. Training Methods
                1. Staff
                2. Manager
            V. Credit Department Systems
                A. Credit Process
                  1. Solicitation of Accounts
                  2. Investigation
                    a. Background
                    b. Operation Methods
                    c. Location
                    d. Trade Clearances
                B. Control Systems
                  1. Accounts Receivable Handling
                  2. Computer Support
                C. Decision Making
                  1. Classifying Accounts
                  2. Marginals
                  3. Pluses/Minuses
                D. Line of Credit
                  1. Setting Line
                  2. Review Methods
              VI. Sources of Information for Analysis
                  A. References
                    1. Agency Sources
                    2. Directory Sources
                  B. Four "C's"
                    1. Character
                    2. Capacity
                    3. Capital
                    4. (Business) Conditions
                  C. Risk Factors
                  D. Legal Forms of Organization
                    1. Types/Definition
                    2. Profit vs. Non-Profit
                  E. Credit Analysis
                    1. Financial Factors
                    2. Non-Financial Factors
                    3. Financial Statements
              Go to Description    Go to top of Competencies    Go to top of Outline