You Are the Head of Finance for a Very Large

question 66

Essay

You are the head of finance for a very large corporation located in a relatively small town. At a local chamber of commerce meeting, the president of the local bank asks you why
you keep the corporation's bank accounts in a very large mid-western bank and not in his local bank. From a risk reduction perspective, how could you answer his question?

---

Definitions:

Statute of Frauds

A legal principle that requires certain types of contracts to be in writing and signed by the parties involved in order to be enforceable.

Guarantor

An individual or entity that guarantees to pay a borrower's debt in the event the borrower defaults on a loan obligation.

Oral Promise

A commitment made through spoken words which, in certain circumstances, can be legally binding, though harder to prove than written contracts.

Garnishment

A legal process by which a creditor can collect what a debtor owes by requiring a third party to turn over the debtor's property or wages.