Bankruptcy Checklist

Managing the credit The privilege of buying goods, services or borrowing money in return for a promise of future payment. department's activities following a bankruptcy filing using a preprinted Checklist can save time and money A medium of exchange; coined or stamped currency. , and more importantly doing so can prevent mistakes.

Important activities that should be included on the Checklist include:

• Promptly sending a reclamation The process by which a seller demands that an insolvent buyer return goods purchased on credit. notice on shipments sent within ten days of the bankruptcy filing date
• Reviewing payments received from the bankrupt debtor or business entity that owes money. within 90 days of the bankruptcy filing date to determine the potential amount of reclamation claims (if any)
• Calculating how much product was shipped to this customer in the 90 days prior to the filing date
• Reprinting copies of all invoices, debits and credits open on the filing date, along with at least two copies of the entire account statement.
• Ordering proof of delivery on all open invoices
• Promptly reviewing every document received from the Court to be sure that no action is required
• Filing a Proof of Claim A right to payment or other equitable remedy Relates to the judicial means or court procedures by which legal and equitable rights are enforced. in the event of a breach of contract. before the bar date
  • Including the required supporting documentation Financial and commercial documents such as drafts, commercial invoices, packing lists, bills of lading, insurance certificates, etc. In Letter of Credit transactions, banks deal with documents alone and are not involved in underlying sales agreements. commercial documents Documents, such as commercial invoices, certificates of origin, packing lists, bills of lading, etc., usually covering a merchandise transaction. such as drafts, commercial invoices, packing lists, bills of lading, insurance certificates, etc. In Letter of Credit transactions, banks deal with documents alone and are not involved in underlying sales agreements. commercial document Documents, such as commercial invoices, certificates of origin, packing lists, bills of lading, etc., usually covering a merchandise transaction. s such as drafts, commercial invoices, packing lists, bills of lading, insurance certificates, etc. In Letter of Credi A financing instrument A right to the payment of money such as agency notes, commercial pape The unsecured promissory notes of large, financially sound corporations. r, T-Bills, certificates of deposit (CD's), banker's acceptances and repurchase agreements. issued by a bank in favor of an exporter The person or company that sells or arranges to transport goods out of a country. that substitutes the bank's creditworthiness for that of the importer. t transactions, banks deal with documents alone and are not involved in underlying sales agreements. with the proof of claim
  • Completing it in its entirety
  • Signing the Claim
  • Send the Claim to the court by registered letter
  • Confirming your company's Claim was received and was filed by the court
  • Keeping a copy of every documentation sent to the court

Source: Steven Kozack and Michael Dennis. Mr. Kozack is a credit consultant and the co-author of "Credit and Collection Manager's Manual" available at the NACM Bookstore.