Scribd
Upload
71 views

Module 7 - COD and Check Sales

This document provides standard operating procedures for cash-on-delivery (COD) sales and handling checks. It outlines 15 steps for COD sales, including indicating COD on shipping documents, only releasing goods after payment is made, and setting limits for delivery personnel. It also details precautions for accepting checks, such as only taking checks from known customers, verifying funds for new checks, and avoiding postdated, unsigned or altered checks. The document educates on different types of checks like certified, crossed, or government checks and markings that indicate a check should be rejected.

Uploaded by

Allan Cris Ricafort
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
71 views

Module 7 - COD and Check Sales

This document provides standard operating procedures for cash-on-delivery (COD) sales and handling checks. It outlines 15 steps for COD sales, including indicating COD on shipping documents, only releasing goods after payment is made, and setting limits for delivery personnel. It also details precautions for accepting checks, such as only taking checks from known customers, verifying funds for new checks, and avoiding postdated, unsigned or altered checks. The document educates on different types of checks like certified, crossed, or government checks and markings that indicate a check should be rejected.

Uploaded by

Allan Cris Ricafort
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 29

COD and CHECK SALES

Allan Cris Ricafort


14 May 2022
2nd sem, AY 2021-2022
2

FMGT 60 - RICAFORT
3

COD SALE
• COD sale is a cash sale.
• This type of sales has become a prime
concern of the credit and collection
department because many “schemes” and
“strategies” have been created by bad faith
buyers.

FMGT 60 - RICAFORT
4

Standard Operating Procedures


for COD Sales
1. COD – Collect on Delivery
2. Cash basis customers – frequent defaulters
on COD terms.
3. COD sales must be avoided if delivery of
merchandise is done at one place and
payment to be effected in another place.

FMGT 60 - RICAFORT
5

Standard Operating Procedures


for COD Sales
4. Place of delivery is unusual –report and
request for instructions
5. Covered by a Purchase Order or Letter Order
of the customer
6. When merchandise is ready for delivery, the
customer should be contacted by phone or
by other means.
FMGT 60 - RICAFORT
6

Standard Operating Procedures


for COD Sales
7. COD shipment should be indicated on common
carrier’s bills of lading
8. Place of delivery and person authorized to receive
merchandise must be stated on the Sales Invoice
(SI) or Delivery Receipt (DR).
9. COD [Cash Only] or COD [Postdated Check Not
Acceptable] must be stamped in every delivery
documents.
FMGT 60 - RICAFORT
7

Standard Operating Procedures


for COD Sales
10. COD sales is a Cash Sale.
11. Credit Manager should be authorized to
decide whether the COD sales can be paid
by check.
12. If a check is to be accepted for a COD
sale, there are some precautions.

FMGT 60 - RICAFORT
8

Standard Operating Procedures


for COD Sales
13. Original copy of the DR or SI will only be entrusted
to the customer after the merchandise is paid.
14. A specific limit of responsibility, as to amount of
COD sales an authorized delivery man can
handle, should be set.
15. Cash deposit of 50% of total amount is sometimes
required from transient and new customers and
balance to be paid on COD term.
FMGT 60 - RICAFORT
9

Precautions when Accepting Check


for a COD Sale
a. Check payment from the unknown or new customer
should first be cleared with the bank.
b. For customers known to have issued bad checks in the
past, prior clearance of check is required.
c. Out of town checks or irregular ones should not be
accepted.
d. Avoid third party check or drawn to “Cash”.

FMGT 60 - RICAFORT
10

Precautions when Accepting Check


for a COD Sale
e. Name of the bank and check numbers should be written
on receipt issued for COD sales by check.
f. In all cases, check payment on COD is only acceptable
from a known person or customer.
g. New customer should be given a trial period before his
check is accepted.
h. Avoid accepting check on COD sales on Friday
afternoons and Saturdays.

FMGT 60 - RICAFORT
11

HANDLING CHECKS
• The credit collection personnel must be trained on how to
handle checks.

FMGT 60 - RICAFORT
12

POSTDATED CHECKS

• The date of issue on the check is a future date.


• As a general rule, field collectors should not accept
postdated check. However, if the check is
postdated for 1 or 2 days, it would be alright to
accept it.

FMGT 60 - RICAFORT
13

POSTDATED CHECKS
Case:
• Collector A paid a visit to Mr. Wang, an installment
customer, on a Monday, the 29th of May, 2021. Mr.
Wang issued a check dated May 31, 2021. Mr. Wang
works as an accountant at a branch of Toyota
Motors. Should the collector accept the check?

FMGT 60 - RICAFORT
14

ANTEDATED CHECK

• This is opposite of a postdated check. It is dated in


the past.
• If nothing else is wrong with the check, an
antedated check is acceptable.

FMGT 60 - RICAFORT
15

ALTERED CHECK

• If the amount, date, or any entry has been altered,


the owner of the check must sign in the alteration.
• No longer allowed by PCHC.

FMGT 60 - RICAFORT
16

UNSIGNED CHECK

• An unsigned check is worthless.

FMGT 60 - RICAFORT
17

UNDATED CHECK

• It is essential that a check be complete on its face.


• All these must be filled out: date, payee, amount in
numbers, amount in words, and the drawer’s
signature.

FMGT 60 - RICAFORT
18

THIRD-PARTY CHECK

• It is a third-party check if the installment customer is


not the owner of the checking account and the
check was issued to him by someone else.
• It is always advisable to reject that kind of check.

FMGT 60 - RICAFORT
19

YOUR COMPANY AS PAYEE

• The check should


always be issued in the
name of the company.
• It cannot be encashed
by anybody else
should it be lost or
taken by someone.
FMGT 60 - RICAFORT
20

BEARER CHECK

• A bearer check is one


where the payee is
either “bearer” or
“cash”.
• It can be encashed at
the bank by the bearer,
or whoever holds it.
FMGT 60 - RICAFORT
21

DEFACED or TORN CHECK

• When certain
parts of the check
are missing,
defaced, or torn,
the check is
worthless.

FMGT 60 - RICAFORT
22

CROSSED CHECK
• The owner of the check would sometimes cross the
check.
• This is a marking, usually 2-straight diagonal lines,
made in the top left-hand corner of the check.
• When a check is crossed, it means that the check
could only be deposited in a bank in the account of
the payee.

FMGT 60 - RICAFORT
23

CROSSED CHECK

FMGT 60 - RICAFORT
24

CORPORATION as PAYEE

• When a check is payable to a corporation, and a


customer wants to pay with that check, it would be
best to refuse to accept.
• For example, if a check was issued by the Provincial
Government in favor of Tricor Industries, Inc. and a
walk-in customer pays with this check, it might result
in a lot of complications.
FMGT 60 - RICAFORT
25

AMOUNT IN FIGURES DIFFERENT FROM


AMOUNT IN WORDS
• An example: “Pay
P254 – Two Hundred
Forty Five Pesos only”.
• When this happens,
either refuse the check
or politely ask the issuer
of the check to issue
another one correctly
done.

FMGT 60 - RICAFORT
26

GOVERNMENT CHECKS

• All government checks, whether national, provincial


or municipal, always have 2 signatures.
• If one signature is missing, do not accept.

FMGT 60 - RICAFORT
27

CERTIFIED CHECK

• It is a check issued by a checking account depositor


which has been certified by the bank as being
funded.
• This is a good check since it has already been
deducted from the depositor’s balance.

FMGT 60 - RICAFORT
28

Markings at the Back


of the Check
• When a case has markings
in the back, it is possible
that the check has
already been negotiated
by someone else.
• If the collector is paid this
kind of check, it must be
rejected outright.
FMGT 60 - RICAFORT
FMGT 60 - RICAFORT 29

END OF THIS MODULE.

You might also like