The normal scope of collateral field examination includes analysis of cash, accounts receivable, inventory, accounts payable, payroll taxes and insurance. Financial statement and general ledger analysis are also part of the overall scope. Again, these individual areas may include an expanded scope depending on the situation.

Collateral field examinations are beneficial prior to the commitment of new or additional financing and on a recurring basis as warranted. Because the financing or working capital needs of your borrower may change daily, the results of a field examination aid in making informed decisions.  These decisions may include increasing a line of credit, disqualifying a portion of the collateral, establishing caps and/or adjusting advance rates. Recurring exams help to keep the lender informed of collateral trends, new ineligible categories, and the accuracy of bank reporting.  Field examinations also benefit the borrower, as the results can provide the lender with additional data and analysis necessary to support an increase in additional funds requested and/or improve the borrowing certificate structure.

The length of the collateral field examination depends greatly upon the scope, nature of business and magnitude of turnover involved.  Each situation varies depending upon the size, volume and track record of past and present business activities, location of customer, accuracy of records, availability of data in electronic form, number of divisions involved and responsiveness of the borrower.  Detailed test programs are designed for each assignment.

ARIZ will provide a list of required materials to the borrower ahead of the field examination to enable them to be prepared in advance and to assist in controlling the cost of the field examination. The borrower can also help to facilitate the examination by providing information electronically.