MONDAY: 21 August 2023. Morning Paper. Time Allowed: 3 hours.
Answer any FIVE questions. ALL questions carry equal marks. Do NOT write anything on this paper.
QUESTION ONE
1. Outline FOUR quantitative factors used in credit risk assessment. (4 marks)
2. Explain FOUR services outsourced by a credit department. (8 marks)
3. Describe FOUR benefits of an effective billing system. (8 marks)
(Total: 20 marks)
QUESTION TWO
1. Highlight SIX steps of credit card operating cycle. (6 marks)
2. Discuss THREE disadvantages of Fintech lending. (6 marks)
3. Explain the following international communication terms (incoterms):
FOB (2 marks)
CIF (2 marks)
DPV (2 marks)
DDP (2 marks)
(Total: 20 marks)
QUESTION THREE
1. Explain the meaning of the following terms:
Solvency Risk. (2 marks)
Liquidity Risk. (2 marks)
Volume Risk. (2 marks)
2. State SIX guidelines for preparing a collection letter. (6 marks)
3. Discuss FOUR characteristics of an effective credit manager. (8 marks)
(Total: 20 marks)
QUESTION FOUR
1. Describe THREE rights of a consumer under credit information sharing (CIS). (6 marks)
2. Enumerate SIX discrepancies that could render a letter of credit (LC) as discrepant. (6 marks)
3. Examine FOUR activities in credit management process. (8 marks)
(Total: 20 marks)
QUESTION FIVE
1. State SIX features of Microfinance Institutions (MFIs). (6 marks)
2. Describe THREE ways of handling bad debts in an organisation. (6 marks)
3. Examine FOUR differences between Fintech lending and traditional lending. (8 marks)
(Total: 20 marks)
QUESTION SIX
1. Enumerate SIX roles of a sales ledger manager that could affect credit management. (6 marks)
2. Describe THREE characteristics of factoring. (6 marks)
3. Explain FOUR benefits of hire purchase system. (8 marks)
(Total: 20 marks)
QUESTION SEVEN
1. Describe the following terms as used in credit insurance:
Whole turnover cover. (2 marks)
Catastrophic cover. (2 marks)
2. Discuss FOUR credit facilities available in business-to-business(B2B) lending. (8 marks)
3. Explain FOUR limitations of credit scoring system. (8 marks)
(Total: 20 marks)
