【正文】 interest must be perfected. This can be done in different ways, depending on the kind of collateral involved. A security interest may be perfected when it attaches, or it may require the transfer of possession form the debtor to the secured party. Transfer of possession is necessary if, for example, one pledges stock as security for a loan. The usual manner of perfecting a security interest is the filing of a financing statement (see Section, below). Sometimes, there are conflicting perfected security interests. In that case, the question of priority arises. The manner of the resolving that issue is addressed by the state. When either filing or the transfer of possession of collateral is necessary for perfection, that act may occur prior to the attachment of the security interest. The security interest is perfected when the last of the events necessary for attachment and perfection has occurred. As there is an advantage in securing priority by an early filing of the financing statement, the financier sometimes does not part with any value until after the filing has occurred. The statute provides that a security interest will attach only if three requirements are met: (a) there must be security agreement,(b) the financier must give value, and (c) the debtor must have rights in the collateral. This last requirement seems simple. But recently a British bank ran afoul of this provision. The case involved the purchase of a yacht in California. The yacht dealer’s inventory was financed by Chrysler Corporation, which held a security interest in the inventory. The dealer sold the yacht to an individual, who financed the transaction through the British bank. Actually, the individual had no assignable rights in the yacht as it was part of Chrysler’s collateral security. The court ruled that the British bank had acquired no security interest and, therefore, that no interest was capable of being perfected. This ruling contradicts the general rule in inventory financing, (stated below in Section 7), but it serves as a cautionary signal to interested parties. Where filling is required to perfect a security interest, the document filed is called a financing statement. Printed statutory forms are available and generally used. The financing statement is simple. It need contain only the names, addresses and signatures. If the secured party is entitled to the proceeds of any sale of the collateral, or of the products that are manufactured with the collateral, this also should be stated in the financing statement. The 1974 revision of the UCC has abolished the requirement that this be mentioned. It is now presumed that proceeds are always covered by the financing statement. However, not all states have accepted this change. The sufficiency of the description of the collateral has sometimes been challenged in litigation. It is therefore advisable to description as specific as possible. It is also advisable to avoid attaching separate documents to the financing statement. The statute says that minor errors in a financing statement will be overlooked if they are not seriously misleading. This has led to conflicting decisions in cases where an error occurred in the description of the name of the debtor. The description misleading of it impedes a searcherif, for instance, a debtor corporation is listed under the name of its division. The rules for filing a financing statement vary in different states. Generally local filing in the county of the debtor’s residence or business and central filing in the state capital are required. A financing statement loses its effect five years after filing. However, a continuation statement may be filed, which extends the effectiveness for an additional five year period. There is no limit to the number of continuation statements that may be filed. Additional filings are made when collateral is released or the entire security agreement is terminated. An assignment of the security agreement may also be filed. If a debt is paid, a diligent debtor will see to it that the public records so indicate. The term,“ proceeds”, includes whatever is received when collateral is sold, exchanged, collected, or otherwise disposed of. Typical proceed are accounts receivable are collected. A secured creditor is entitled to a security interest in the proceeds, even if that is not expressly stated in