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Purdy Powers & Company can assist lenders in validating collateral used by borrowers to secure financing. Agreed upon procedures to assist asset-based lenders include:
- Confirmation of the borrower's accounts receivable balances
- Aging of accounts receivable balance and analysis of the allowance for doubtful accounts (to provide assurance that the receivable is collectible)
- Confirmation of investments held by borrower
- Physical counts of inventory
- Inventory analysis to segregate finished goods inventory from raw materials (for lenders that only accept finished good inventory as collateral)
- Inventory price testing and review of E&O reserves to provide assurance of the value of the inventory
- Physical verification of fixed assets pledged as collateral
In addition to the above services, Purdy Powers & Company can also perform procedures to ensure the borrower is in compliance with any existing debt covenants.
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