Assignment of Claims Act of 1986"....What does this mean for you?

What does this mean to you? Simply, the U.S Government encourages their vendorsto seek accounts receivable factoring of their invoices in order to help them grow,improve cashflow, increase performance, and level the playing field.

Access Unlimited Capital Through the Creditworthiness of the U.S. Government Any government contractor, under the the Assignment of Claims Act of 1986, mayassign it's rights to be paid amounts due or to become due as a result of theperformance of a contract to a bank, trust company or other financing institution.Larger vendors have been doing this for years.

Invoice Factoring is when a business sells unpaid accounts receivable invoices to aspecialized financial institution called a Factor. The factoring company buys theinvoice from the business for an amount less than its actual face value, then latercollects the full amount of the invoice from the account debtor when it finally comesdue. This service is useful to a business that cannot afford to wait 30, 60, or 90days to collect payment from customers, cash is needed immediately for growth orsurvival.

When a business delivers goods or services to another business, an invoice isgenerated stating the amount owed and the terms (number of days) in which theinvoice must be paid. This invoice along with its terms becomes an accountsreceivable: money owed to a business, from a business, for goods or servicesdelivered. The terms for these invoices are usually 30, 60, or even 90 days. After thebusiness sends out the invoice it must wait the length of the term (or longer) tocollect the debt and recognize the revenue generated. Waiting for these long billingcycles to close can be difficult for a company that is growing fast or just strugglingto survive.

Rather than waiting for long billing cycles to close, a business has the option to sellsome or all of its outstanding invoices to a Factor (for a discount) and receivefunding within 24 hours or less. The Factor will eventually collect the full amount ofthe invoice from the account debtor.

Afra AmirSanjari is the Principal for Peacock Capital. Peacock Capital specializes insolving the cash flow challenges of Small/Medium Businesses, Government Vendorsand Individuals with innovative financial solutions by providing a network forsecuring operating capital.

http://www.peacockcapital.com;info@peacockcapital.com