Questions (FAQ) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

What is the Cash Flow Industry? The Cash Flow Industry is a marketplace where businesses and individuals sell future or structured income streams for cash today. One way the industry addresses cash flow needs is buying, selling and brokering future income streams

What is an income stream? Cash flow professionals refer to a future payment or series of payments as an income stream. An income stream is a financial obligation or debt that one party owes to another.

Why do businesses or individuals want to sell their income streams? Businesses and individuals sell their income streams for the following reasons:

·    Access – People want or need immediate access to their cash.

·    Interest or Yield – Cash in hand today can start earning interest or yield immediately.

·    Inflation – Inflation erodes the future “buying power” of money.

Why do people want to buy income streams? Buying future payments is a form of investment. Investors seek to maximize the amount of income their money produces. They can achieve this with the purchase of income streams.

What is the time value of money? The term “time value of money” refers to the way the value of money changes over a designated period of time. Two factors affecting the time value of money are interest and inflation.

·    Interest – Interest enables one to invest a sum of money today and turn it into a larger sum over a period of time.

·    Inflation – Inflation erodes the future “buying power” of money.

What is a typical Cash Flow Transaction? If the owner of a manufacturing company receives an order for $50,000, the goods ordered will take several weeks to produce, deliver and invoice. Once the goods are delivered it could take another 30 to 90 days (or longer) before the manufacturer is paid for those goods. Would the manufacturer be willing to give up a small percentage to a funding source to acquire capital immediately rather than waiting several months (This is, effectively, no different than giving a discount for prompt payment, e.g., 2% 10, net 30)?

·    He would if he needed cash to pay bills or meet payroll.

·    He would if he wanted to use this capital to buy supplies at a bulk discount because he would be able to pay cash.

·    He would if he needed the capital for business expansion and to increase revenues.

What are the benefits of selling your accounts receivable (factoring)? Accounts receivable funding increases cash flow and working capital. This increased cash flow can be used to increase sales, meet payroll, pay bills or buy needed inventory.

How does selling accounts receivable differ from bank financing? A client’s ability to increase cash flow by selling his accounts receivable is based upon the total of his accounts receivable rather than on his financial strength or stability. Unlike borrowing money, this method does not create debt or require interest payments (or any other type of payments). This is not a loan and the accounts receivable funding is not based on the company’s credit but rather the credit worthiness of the company’s customers.

Are accounts receivable actually purchased? Yes. Funding sources do not lend money. They make an outright purchase of the financial rights to the invoices at the time of billing.

What types of receivables are purchased? Funding sources buy valid receivables associated with a product delivered or a service performed for a business or government agency.

What are the requirements for buying an invoice? The work, service or goods must be completed, delivered and accepted. The invoice seller’s client must also be creditworthy.

What is the smallest invoice a funding source will buy? There are clients that send multiple invoices ranging from $100 to $1,000.

What is the largest invoice a funding source will buy? There are no limits. We are in business to service any size client.

Do we bill on our letterhead or that or the funding source? Clients continue to bill normally. Checks may be made payable to you, but are mailed to the funding source.

What will my customers think? The process of selling income streams, both in the commercial and private sectors, has been around for centuries and has no effect on your customers. If you have ever owned a home, you probably made payments to the original mortgage holder for a period of time, then the mortgage was sold and you were notified to make your payments to another mortgage company. This is the same process. In actuality, your customers will likely recognize that you make sound business decisions by obtaining the money owed to you immediately and making the best use of that money rather than waiting for an indefinite period of time to receive it. Since the turn-around time to obtain your cash is quick, it clearly enhances your bottom line.

Do I have to sell my future receivable to the same funding source? No. You are under no obligation to continue; however, should you decide to use our service again at a later date you are already established as a client. You are also welcome to use our services on an as-needed basis.

Are there any geographical restrictions on this service? Our investors will buy the invoices of any creditworthy business or governmental agency in the United States. International receivables may require special attention.

What is NOT required when selling accounts receivable? Financial statements, audits of the client’s books, tax returns or long-term contracts are not required.

Can we qualify with a history of credit problems such as bankruptcy, IRS liens or judgments? Yes. Investors are experienced in making arrangements with the IRS and the courts.

Can we qualify if we already have existing lines of credit or SBA loans? Investors work in cooperation with your existing lenders to enable you to access even larger amounts of funding.

How do investors make money? Investors collect their fee when the invoice is paid.

Will factoring be good for my business? Receivables funding has helped thousands of businesses grow. Funding Access Associates will help you eliminate cash flow issues so you can concentrate on the day-to-day operations of your business.

Call us today at (913) 491-0490 for a FREE consultation, e-mail us at: mark@funding-access.com or simply click on “Contact Us.”