ACT AwardICM Practice Questions - ACT Award In International Cash Management (AwardICM) Exam

Under a Payment Factory model, how does the Payments-on-Behalf-Of (POBO) structure operate?

Subsidiaries issue cheques from local bank accounts in local currencies The central treasury or payment factory executes vendor payments from a central bank account in the name of the central entity on behalf of operating units Suppliers directly debit the corporate headquarters account without subsidiary authorization Commercial banks execute all vendor payments automatically based on artificial intelligence without corporate instructions

Correct Answer:

The central treasury or payment factory executes vendor payments from a central bank account in the name of the central entity on behalf of operating units

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