BPOI-004

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DIPLOMA IN BUSINESS PROCESS OUTSOURCING - FINANCE AND ACCOUNTING (DBPOFA) Term-End Examination June, 2014

BPOI-004 : ORDER TO CASH ACCOUNTS RECEIVABLE Maximum Marks : 100 Time : 3 hours Note : Section - I - All questions are compulsory. Section - II - Answer any six questions out of eight. Section III - Question No. 11 is compulsory. Answer any three questions from question No. 12 to 16. SECTION - I All questions are compulsory in this section. 1.

Fill in the blanks : team recognizes the customer (a) payments against appropriate invoices. (b) The third party which provide credit related information on a prospective customer is called (c) The cash application team needs documents to apply cash and against the specific invoices. (d) The rate of number of payments actually received to the number of payments committed is called (e) The maintainance of sales related documentation to enable revenue recognition is the responsibility of

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1 1 1 1 1

P.T.O.

2.

True or False : (a) Prompt collection cases the pressure on the working capital of the company. (b) Dunning letters are sent before the legal notice. (c) Credit check is not an activity that needs to be done again and again. (d) Confirmation of a purchase order does not lead to any accounting transaction. (e) Revenue risk is mitigated by making sure that the dues are collected from customers in time.

1 1 1 1 1

SECTION - II 3.

Attempt any six questions out of eight : What are the key metrics used to measure the performance of cash application team ?

5

4.

Explain the following terms in 02C process : (a) Remittance Advice (b) Dunning Letters (c) Service Contract (d) Credit Note

5.

Explain : (a) Liquidity risk (b) Credit risk

2.5 2.5

Write the Journal entries for the following 02C transactions : (a) Sold goods for cash (b) Created a provision for bad debts

2.5 2.5

6.

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7.

Explain the term Credit limit and Credit period in 02C cycle2.

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8.

Compare the advantages and disadvantages of the e-mail and telephone calls as collection tools.

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9.

Explain the role of a collection agent in collecting the dues for the seller.

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10.

What are the metrics that are tracked in the invoicing team ? Explain in detail.

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SECTION - III Question No. 11 is compulsory and any three questions 12 to 16 : 11.

Explain the consequences of poor quality control in 02C processes.

15

12.

Explain the risks involved in the 02C processes. How are these risks mitigated ?

15

13.

Explain the following ratios in the collection pyramid : (a) Penetration rate (b) Contact rate (c) Promise rate (d) Kept rate

15

14.

What are the technology and tools used for 02C outsourcing ?

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15.

Explain the cash application process. What are the source documents that are needed to apply cash ?

15

16.

How do you measure performance of the 15 Collection Team ?

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BPOI-004 No. of Printed Pages : 3 DIPLOMA IN BUSINESS PROCESS ...

DIPLOMA IN BUSINESS PROCESS. 00 ... (d) The rate of number of payments actually. 1 received to ... the e-mail and telephone calls as collection tools. 2.5. 5.

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