Company: CPSS
Filing Date: 2025-03-12
Form Type: 10-K
Source: 0001683168-25-001548
Chunk: 609

Company: CONSUMER PORTFOLIO SERVICES, INC.
Filing Date: 2025-03-12
Form: 10-K
Item: Item 2
Chunk 609
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. Each director retains his full oversight responsibility.

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Our Board structure supports the independence
of our non-management directors. Our Audit Committee, Compensation Committee and Nominating Committee are each composed solely of independent
directors. Our bylaws provide that any two directors have the authority to call meetings of the Board of Directors, as do specified officers,
including the president and the secretary. To enhance the possible use of that authority by independent directors, the corporate secretary
is under standing instructions to call a meeting at the instance of any one director.

The board believes that combining the Chairman
and Chief Executive Officer positions is currently the most effective leadership structure given Mr. Bradley’s in-depth knowledge
of our business and industry and his demonstrated ability to formulate and implement strategic initiatives. Mr. Bradley is continuously
involved in developing and implementing our strategies, working closely with the company’s other senior executives to seek continued
disciplined growth and excellence in operations. His close involvement in management places Mr. Bradley in the best position to decide
which business issues require consideration by the independent directors of the board. In addition, having a combined Chairman and Chief
Executive Officer enables us to speak with a unified voice to shareholders, customers and others concerned with our company. The Board
believes that combining the Chief Executive and Chairman roles, as part of a governance structure that includes oversight of management
responsibilities by independent directors, provides the preferred system for meeting the requirement that the Company be managed in the
best interest of our shareholders.

Risk Oversight 

The board’s overall responsibility for
directing the management of the Company includes risk oversight. The risk oversight function is performed at the board level, and by
the Audit and Compensation Committees.

The Board of Directors as a whole in its regular
meetings discusses and considers the risk inherent in the existing business of the Company and in proposed initiatives. Because the Company’s
business consists of extending consumer credit to individuals believed to be of higher risk than others (sub-prime credit), the assessment
of the risk assumed in such extensions of credit is a primary consideration on the part of the board. Risk oversight is also a key function
of the Audit Committee and Compensation Committee.

The principal risk management function performed
by the Audit Committee is the ongoing assessment of the credit estimates and allowances periodically recorded in the Company’s
books. The Audit Committee reviews that assessment regularly. Other risk assessments performed by the Audit Committee include assessments
of contingent liabilities, and of other reserves and allowances.

The principal risk management functions performed