An Analytical Study on Receivables Management

Abstract

The modern business activities involves in both credit and cash transaction. Without offering credit facilities to the customers, the organization finds difficult to expand its business or commercial activities at their expected level. At present most of the organization need credit facilities without adversely affecting sales. Expansion of the business or increase in sales is more essential to increase profitability. For this reason, this study concentrates on receivables management. The research is in analytical in nature so that it has used the information already available and analyzes that information to make a critical evaluation of the Receivable Management. So the study is based on secondary data which collected from the company records, articles, and websites. Particularly for the company records data, the source of data is the various years balance sheet, profit and loss account and statements provided by the company. They were used for the analysis and for preparing reports. The collected data were analyzed using Ageing schedule and Average collection period statistical techniques. The study concludes by saying that the company following an effective receivable system of collecting outstanding bills with in the stipulated credit period. It also found that the company receives majority of their pending bills in minimum credit period which actually prevents them from facing huge losses.