Glossary Common terms in conjunction with supply chain finance

The buyer is the purchaser of the goods/services provided by the supplier and also the recipient of the invoices.

The supplier provides the ordered goods/services and is the beneficiary of the accounts receivables.

Optimization of the profitability of the entire supply chain through a sustainable integration of procurement, invoicing and financing processes on one single online platform.

Irrevocable payment order as a part of the UBS Supply Chain Finance solution.

The irrevocable acceptance and confirmation of an invoice effected by the buyer.

Average number of days until a company pays the suppliers.
DPO = (liabilities/cost of sales)*360

Average number of days until receivables are paid (incoming payment on the supplier's account).
DSO = (receivables/sales proceeds)*360

Commitment by the supplier to take part in the Supply Chain Finance program.

"The term compliance stands for the adherence to legal provisions and regulatory standards and the fulfillment of other fundamental ethical standards and requirements that are generally set by the company itself." Eberhard Krügler

All documents and instruments required to participate to the program.

Irrevocable commitment of the issuing bank in form of a binding payment obligation following submission of the conforming letter-of-credit documents.

Sales financing in which the factor purchases the receivables of a client arising from a delivery of goods minus the factoring fee and the interest for the time until the (average) due date of the receivables.

Corporate responsibility towards the environment, market, employees and other stakeholder groups.

Reverse Factoring = Supply Chain Finance = Confirming®

Strategic initiative for companies that decide to base their business activities and strategies on ten universally recognized principles of human rights, labor standards, environmental protection and fight against corruption.

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