Section 140.04. Asset reporting.

 

(1)   Valuation. The financial statement shall present assets in terms of historical cost or book value of assets. In lieu of a statement presented with historical cost of fixed assets or book value of assets, the department shall consider a statement presenting fair market value information of fixed assets if clearly labeled and accompanied by an appraisal report of a certified appraiser or tax appraisal.

(2)   Cash. Whenever a substantial portion of the assets of an entity is in the form of cash, confirmation of the amount is required from the financial institution holding the cash.

(3)   Receivables. When a substantial portion of the assets of an entity are in the form of receivables from another individual, partnership or corporation, all or part of the receivables shall be discounted in considering the net worth of the applicant. In order to evaluate the quality of a receivable, a financial statement from the individual, partnership or corporation may be required. In no case will the department discount factory receivables.

(4)   Inventory. The financial statement shall include the number of units in inventory and the number of units floor planned or used for loan collateral. A GAAP presentation of inventory values would not allow for the use of a reserve account for balance sheet information compiled for external purposes. As an exception to a GAAP presentation, the department will allow the use of a reserve account to accurately assess the value of inventory.

(5)   Certain assets not to be considered. The department shall not consider the following assets in evaluating the financial statement of an applicant:

(a) As specified in s. 815.20 , Stats., equity in homestead property up to $25,000;

(b) As specified in s. 815.18 , Stats., items of personal property which are exempt from execution;

(c) Any intangible asset values;

(d) Leasehold improvements; and

(e) All other assets subject to prior liens, security agreements, or other pledges.

History: Cr. Register, March, 1985, No. 351 , eff. 4-1-85.