Securitization as an arrangement for selling receivables

Securitization is a widely-used arrangement for selling receivables. Many companies use credit card securitization and other forms of securitizations as part of their overall financing strategies.

Required:

Explain the nature of securitization, how it can be implemented, and the appropriate accounting procedures related to a securitization. Include in your discussion the effects of recourse provisions on the securitization.

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