RECEIVABLES FINANCE GLOSSARY

Receivables pool

DEFINITION

A receivables pool is the population of accounts receivable pledged or sold as collateral in a securitization or receivables purchase program. The pool is defined as of a cutoff date, filtered through the agreement's eligibility criteria, and in revolving structures replenished continuously as receivables collect and new ones are originated.

Applies to:Trade receivables securitizationReceivables purchase agreementsFactoring

The pool is a defined population, not just your AR

Your ledger holds every receivable the business has. The pool holds only what the agreement says it holds: receivables originated by named sellers, in permitted currencies and jurisdictions, from obligors that meet the criteria, measured as of a specific cutoff. Two facilities against the same business can hold different pools, for example one funding only domestic dollar receivables while foreign balances stay outside the structure.

The cutoff date is what makes the pool auditable. Every report describes the pool as it stood at a stated moment, commonly month end, and every ratio and reserve is computed from that snapshot plus the activity since the prior cutoff. An extract pulled two days after the cutoff describes a different pool, which is a common source of tie out failures.

Pool composition, with numbers

POOL COMPOSITION AT THE MARCH 31 CUTOFF
Measure	Value
Open invoices in the pool	18,400
Distinct obligor groups	620
Gross pool balance	$48,000,000
Less: ineligible receivables at cutoff	($5,200,000)
Less: excess concentration	($1,800,000)
Net pool balance	$41,000,000
Largest obligor group share of eligible pool	8.9%
Top 10 obligor groups share	34.2%
Weighted average days until due	42 days

Composition statistics like these appear on most servicer reports because they describe the risk the funding parties are holding. A pool drifting from 620 obligors toward 300, or from 34 percent to 50 percent in the top 10 names, is becoming a different credit even if the balance never moves.

Revolving pools and why they need constant retesting

Trade receivables turn fast, commonly 40 to 60 days, so a static pool would collect out in two months. Most trade receivables securitizations are therefore revolving: collections on pooled receivables fund the purchase of newly originated ones, and the pool composition changes every day. That is efficient, but it means eligibility, concentration, and reserves must be retested at every cutoff, because this month's pool is not last month's pool with new dates.

Revolving structures also carry termination mechanics. When a trigger breaches, the revolving period can end and the pool goes into amortization: collections repay the funding instead of buying new receivables, and the pool runs off.

How Olycor handles the pool

Olycor snapshots the pool at each cutoff from invoice level source data, applies the facility's eligibility and concentration rules to that exact population, and computes composition statistics deterministically. Every pool level figure, from the net balance to the top 10 concentration, decomposes to the invoices and obligors inside it, so cutoff questions get answered from the record rather than reconstructed from memory.

Frequently asked questions

Is the receivables pool the same as eligible receivables?+

No. The pool is the population inside the structure, which usually includes ineligible receivables that simply carry no funding value. Eligible receivables are the subset that passes the agreement's tests. Reports typically show the walk from gross pool balance through ineligibles and excess concentration to the net balance that supports funding.

What is a cutoff date and why does it matter?+

The cutoff is the moment the pool is measured for a reporting period. Every balance, ratio, and reserve in the report describes the pool as of that date. Data extracted on a different date will not tie, so the discipline of pulling files at the cutoff, and recording when they were pulled, is foundational to reporting that survives review.

Can receivables be removed from a pool?+

Commonly yes, under defined mechanics. Collections remove receivables naturally. Many agreements also require the seller to repurchase or substitute receivables that turn out to have breached eligibility representations at sale, and deemed collections provisions treat dilution on pooled receivables as if cash had arrived. The agreement's terms control.

Know exactly what is in the pool at every cutoff.

Olycor snapshots the pool from source data, applies your facility's rules to that exact population, and decomposes every statistic to the invoices behind it.

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