I - Financial Assets: General principles 

2. Content of financial assets: Securitization - Example of posting entries

Comments

• Trade receivables do not take into account the outstanding securitized receivables that represent the difference between the total of securitized receivables and the related payments received. These outstanding receivables form part of the working capital (treated within A41100 - Trade receivables).
• The securitized receivables collected to reimburse to the financial institutions also form part of the working capital . The cash cashed in on behalf of the financial institutions is reversed in the same way as the payable toward these institutions (to avoid counting twice the same cash).
• The costs related to securitization are reported under "R53730 - Costs on transferred receivables" among the financial charges on net debt, below EBIT.
• The related PF1 companies COCA accounts are the following:
  • Under R53730:
    • 6533000000 - Expenses related to securitized transactions
  • Under A41100:
    • 2500000000 - Outstanding securitized receivables
    • 2500010000 - Guarantee reserve of trade receivables
    • 5090000000 - Securitized receivables collected and to reimburse to financial institutions

Posting entries to reflect the following scenario

Securitized amount of 1.000; of which 100 is retained by the bank as guarantee reserve.

Payment from the customer = 340

1.  Transfer of the receivable to the bank:

2.  Payment from the customer:

3.  Simultaneously with previous entry, adjustment of the outstanding securitized receivables and recognition of a debt towards the bank:

Other posting entries:

• Payment to the bank of the receivable cashed in:

• Once the customer has paid his debt, reimbursement by the bank of the guarantee reserve:

• Payment of securitization expenses to the bank: