What is incoming debt. Accounts receivable of the organization: causes, types and consequences

Receivables - debts of other organizations, employees and individuals of this organization (debts of buyers for purchased products, accountable persons for the sums of money issued to them on account, etc.). Organizations and persons who owe this organization are called debtors.

The economic essence of accounts receivable acts as funds temporarily diverted from the company's turnover. This distraction can provoke additional demand for resources and lead to financial stress.

Upon expiration of the limitation period, receivables and payables are subject to write-off. The general limitation period is set at three years. For certain types of claims, the law may establish special limitation periods, reduced or longer than the general period.

The limitation period begins to be calculated at the end of the term for the performance of obligations, if it is determined, or from the moment when the creditor has the right to file a claim for the performance of the obligation.

Accounts receivable after the expiration of the limitation period are written off to reduce profit or allowance for doubtful debts.

Accounts receivable can be viewed in three senses: firstly, as a means of paying off accounts payable, secondly, as part of the products sold to customers, and thirdly, as one element of current assets, an important part of the organization's working capital.

Accounts receivable are classified into various views depending on the economic content of the obligations, on the duration (term of provision), on the timeliness of payment.

Types of accounts receivable in accordance with its classification features are presented in Figure 1.

Fig. 1- Classification of receivables

By the content of obligations accounts receivable may be associated with the sale of products, goods, works, services (debt for products, goods, works and services, including those secured by promissory notes) and not related to it (debt on settlements with the budget, on rent, on advances issued, on accrued income, on internal settlements, other debt).

By duration debt is divided into short-term and long-term. Accounts receivable are presented as short-term if their maturity date is not more than 12 months after the reporting date. The rest of the receivables are presented as long-term.

On time payment accounts receivable can be divided into normal and overdue. Debt is considered normal if the due date has not arrived. And the overdue debt is considered to be for goods, works, services that have not been paid for within the period specified in the contract.

Overdue accounts receivable can be doubtful and hopeless.

Tax legislation gives a definition of doubtful debt: “A doubtful debt is any debt to a taxpayer arising in connection with the sale of goods, performance of work, provision of services, if this debt is not repaid within the terms established by the contract and is not secured by a pledge, surety, bank guarantee ”.

Bad debts are those debts to the organization for which the limitation period has expired, as well as those debts for which the obligation is terminated due to the impossibility of its performance, or on the basis of an act of a state body or liquidation.

Creditor's call the debt of this organization to other organizations, employees and persons who are called creditors.

Accounts payable after the expiration of the limitation period are written off to financial results.

Accounts payable classified depending on the content of obligations, on the duration and possibility of fulfilling obligations. The types of accounts payable are shown in Figure 2.

By the content of obligations accounts payable may be associated with the purchase of inventories, works, services (debt for purchased products, goods, works and services, including amounts on bills presented for payment) and is not related to it (debt on settlements with the budget, debt to subsidiaries and dependent companies, to the personnel of the organization, to the participants (founders) for the payment of income, other debts).

Rice. 2 - Classification of accounts payable

By time subdivided into long-term and short-term. In a broad sense, the composition of accounts payable includes any debt of an organization to anyone else. Long-term debt includes debt on long-term loans and borrowings. But it is known that loans and credits in Russian accounting and reporting are separated from accounts payable and are classified as long-term and short-term liabilities. Nevertheless, in many literary sources, from an economic and legal point of view, all types of debt and credit obligations are included in accounts payable.

If possible, fulfillment of obligations debt to creditors can be divided into normal and overdue.

At the same time, two types of debt can be distinguished as part of overdue accounts payable: debt, the statute of limitations for which has not expired, and unclaimed debt (with expired statute of limitations).

To this classification, it can be added that as part of the obligations of any organization, it is conditionally possible to distinguish also urgent debt (debt to the budget for wages, social insurance and security) and ordinary (liabilities to subsidiaries and dependent companies, advances received, promissory notes payable, etc. creditors; debts to suppliers). This classification is often used in economic analysis.

A common feature of accounts payable and receivable is that they are based on the time lag between a commodity transaction and its payment.

Any enterprise that produces inventories (TMC), works, provides services, constantly makes settlements with buying firms for the products transferred to them. In unstable market conditions, for various reasons, payment of invoices by the latter can be fully or partially postponed, which leads to the formation of accounts receivable. Part of this debt in the course of economic activity is inevitable, but it must be kept within acceptable values.

Accounts receivable is a set of debts due to an economic entity from individuals or legal entities as a result of economic relations with them. To manage debtor debt, you need to know its definition, types, causes, etc.

To ensure the financial stability of the company, it is important that buyers cover the amount of the organization itself.

In essence, these are the firm's property claims to its debtors. Usually they are formed when products are transferred to counterparties on credit under the terms of the contract, due to their failure to fulfill monetary obligations, as well as excessive payment of amounts to the budget, etc.

Classification of debts of debtors by source of origin

Current receivables can be classified according to several criteria. In particular, according to the source of its origin, it is subdivided (and accordingly shown in the asset of the balance sheet) into the following:

• buyers and customers;
• on bills received;
• on advances issued;
• subsidiaries and affiliates;
• participants (founders) to make contributions to the authorized capital;
• other debtors.

As prescribed by the accounting instructions in force in the Russian Federation, the amounts of receivables from buyers and customers are charged at the generally accepted moment of the sale of goods and materials, works, services and the presentation of settlement documents in the amount of their contractual or estimated value. If the counterparty has previously transferred the advance payment, then upon the sale, its debt is charged in the general manner, but at the same time it is reduced by the amount of the advance payment.

If the current receivable is not settled after the buyer receives the invoice and the agreed payment deadline (or within 30 to 45 days, which is considered reasonable to settle the buyer's receivable), then it is classified as overdue. At the same time, a negative business reputation is assigned to the counterparty. In this regard, it is advisable to conduct analytical accounting for each debtor with fixing the maturity dates.

The supply agreement may contain the condition that the ownership of goods and materials transfers to the buyer only after the funds are transferred to the organization's current account. In this case, the moment of sale is the moment when the counterparty fulfills its obligations to pay for valuables, therefore, current accounts receivable for it are not accrued. In this case, in the event of non-payment of the goods within the period stipulated by the contract, the seller may present the buyer with a demand to return the goods.

Accounts receivable from buyers (customers) are accrued in other cases:

• when making scheduled payments;
• when reporting surpluses identified by counterparties during the acceptance of shipped goods and materials.

Debt obligations on bills received, prepayments and advances issued

The formation of accounts receivable on bills received is facilitated by settlements with counterparties, from whom the firm accepts bills of exchange as a means of payment. Its accounting is kept on subaccount 62-3, and if the bill of exchange is accepted for non-commodity transactions, then on the account. 76. Analytical accounting for these accounts is provided for the following groups of bills:

• received, but not yet due;
• discounted (recorded) in banking institutions;
• not paid on time.

In the accounting of an economic entity, the amounts of the prepayment transferred by him are taken into account as part of the debt for debtors-suppliers and contractors and, until the arrival of values ​​at the enterprise, are considered materials in transit. Accounts receivable for prepayment are closed by the accountant upon acceptance of the relevant goods and materials and works, and upon receipt of services.

With advance payments, there is such a difference from prepayment: settlement documents are not drawn up, in the accounting of the buying company, the amount of advances issued and payment for products in partial readiness is included in accounts receivable for issued advances. When transferring values, the supplier gives the buyer the settlement documents for their full value. According to this fact, accounts payable to this supplier in the amount indicated in the invoice are recorded in the buyer's accounting. At the same time, the accountant sets off the advances issued, that is, he pays off the receivables for the advances issued and reduces the debt to the supplier by the same amount.

Debts of subsidiaries and founders

The parent company and its subsidiaries (dependent) companies can accrue receivables for mutual settlements, profit from mutual operations, except for the transfer of goods and materials in the form of financial assistance, that is, free of charge. The parent entity can do this for dividends due from subsidiaries.

The authorized capital (MC) of OJSC, CJSC, LLC and other organizations at the time of their registration is subject to payment by participants at least 50%. The rest of the charter capital must be paid by the company's participants during the first year of economic activity. The founders' contributions to the charter capital can be made in money, material assets, securities, property and other rights that can receive a monetary value. When a company is formed, its participants (founders) are charged with debt on deposits in the charter capital, which is obligatory to be paid off within a year. The state of such calculations is summarized on the account. 75.

Debts of other debtors

The formation of accounts receivable, assigned by the enterprise to other debtors, is caused by debt obligations from the side:

• tax, financial and other authorities for overpayment of taxes, fees, other payments to the budget (recorded on account 68);
• own employees on loans (loans) granted to them from the enterprise or at the expense of bank loans, to reimburse the material damage caused to the company by the employee (due to shortage, damage to valuables) and other operations (p. 73);
• accountable persons who receive money in advance for economic and operational expenses, business trips, expenses of geological exploration parties, expeditions, etc. (p. 71);
• suppliers, contractors and other counterparties on claims presented to them, for example, in cases of violations of contractual conditions already after payment (acceptance) of settlement documents of suppliers, if the buyer insists on a full or partial refund of the amounts paid (p. 63);
• municipal and state bodies (sc. 77);
• various debtors on non-commodity transactions, as an example - the debt on the lease payment due to the enterprise for the fixed assets transferred to them for lease (account 76).

Other classifications of debt obligations of debtors

In order of occurrence, receivables are normal and unjustified. A debt that arises within the framework of the existing credit policy of an economic entity, the standards for assessing the creditworthiness of counterparties adopted by it and within the limits of the latter's lending are considered normal. Unjustified indebtedness is formed as a result of violation of the existing regulations and standards at the enterprise for providing customers with a deferred payment, violation of the order of delivery of goods and materials, etc.

According to the criterion of overdue debts are divided into planned, the maturity of which has not yet come, and overdue, payments for which were not made within the period specified in the contract. By the duration of the delay, various groups of debtors' debt obligations are distinguished:

1. Debts with a delay of up to 45 days.
2. 45 to 90 days, etc.

According to the criterion of the reality of collection, experts distinguish 3 groups of receivables:

1. Real for collection.
2. Problematic (doubtful).
3. Hopeless.

The need to analyze debt obligations

Accounts receivable, depending on the functions they perform, can be considered by organizations as:

1. Means of paying off your own debt to creditors.
2. Parts of products sold to buyers but not yet paid for by them.
3. One of the elements of current assets, which can be financed from own or borrowed funds.

Debts of debtors, also called accounts of debtors, directly affect the situation with the cash and payments of the organization. Since the net debt of debtors is the amount of funds diverted from the turnover, the financial services of the enterprise have to analyze its turnover, maturity dates, take measures to collect, working with debtors, etc.

So, the turnover of accounts receivable is the ratio of the volume of proceeds received from the sale of products to the average amount of invoices issued for payment of these products, minus reserves for doubtful positions. It shows how many times the accounts receivable turned into cash or how much revenue was received from 1 ruble. debt. The high value of turnover means that little time passes between the shipment of products and the moment of payment by consumers, therefore, the organization is distinguished by high indicators of liquidity and solvency.

For the calculation, the formula is as follows:

DSO = (ДЗср × 365) / ВР, where:

DSO - turnover ratio in days,

ДЗср - the average accounts receivable of the buyer in rubles,

ВР - proceeds from sales or sales on credit in rubles.

This coefficient characterizes the average period of time during which funds from buyers arrive at the seller's bank accounts. The lower its value, the more comfortable conditions the firm operates. Thus, by managing these indicators, she can significantly improve her financial position.

Each enterprise, regardless of the form of ownership, keeps records of its own income and expenses. This is important both for huge companies that are at the forefront of the market and for entrepreneurs starting their own small businesses. At the end of the next reporting period, they have to analyze the results obtained from the work performed. But to carry out these final operations, you need to have a clear idea of ​​how the enterprise lives, what sources it relies on and how it uses the existing assets. It is about the company's assets, in particular, about receivables, which will be discussed in this publication.

Accounts receivable

Novice entrepreneurs are often unclear about the meaning of this expression, and especially the fact that debtors' debts are classified as assets, that is, the property of the company. The explanation is simple: a receivable is a debt owed to a company from individuals or legal entities for exported goods, services or other work performed but not yet paid.

Accounts receivable on the balance sheet are part of the firm's property, i.e. an asset.

In other words, the meaning of this balance sheet line for the firm can be formulated with the phrase "We owe it." At a certain time, these debts are paid off, turning into monetary form, and increase the amount of money in the cashier of the company or in its bank account. Hence the conclusion: accounts receivable in the balance sheet is part of the firm's property, that is, an asset.

How debt is formed

Not a single company can do without the occurrence of such a debt, since this is always explained by production necessity: it is profitable for one company to offer its own goods and transfer it, deferring payment, to the other - to get it with the possibility of payment by installments. This is where mutual mutual interest arises:

• the debtor company is provided with a temporary opportunity to use someone else's working capital (purchased but still unpaid goods);
• the creditor company uses the chance to expand the market for the supply of goods, search for potential buyers.

The structure of accounts receivable also includes the amount of advances paid to supplier firms as a preliminary payment for services / goods purchased in the future.

Note that such transactions are necessarily formalized by drawing up contracts, which stipulate the terms and conditions for the delivery or acceptance of services, as well as the dates and methods of payment. Having explained what accounts receivable are in simple terms, let's move on and look at how it affects the life of the company.

Since such debts are formed from funds that are diverted from the economic turnover of the company, it is necessary to control their growth, ensuring timely collection in accordance with the concluded agreements. After all, it is impossible to admit a situation in which debtor enterprises suddenly abandon their obligations, do not pay and do not return the exported goods. That is why, an element of control is extremely important when concluding a contract and ensuring that its conditions are fulfilled by both parties.

Not only contracts for the supply of a manufactured product can be the causes of receivables. It can be increased, for example, by the amount of overpaid taxes to the budget or extra-budgetary funds, which will be written off by subsequent transfer of payments.

Another position that is reflected in the increase in the amount of debt is the debts of the personnel of the enterprise for the amounts issued for the report or the salary received in excess. In enterprises, they practice the issuance of money under the report for economic needs to materially responsible persons.

For example, the storekeeper gets cash to buy office supplies or to buy technical literature. The issued amount is reflected in the structure of accounts receivable and is repaid only when the employee reports on the costs incurred, listing them in the advance report and attaching all documents confirming the fact of acquisitions to it.

Types of accounts receivable

What are the types of receivables

Debt is divided into normal and overdue. Debts are classified as normal:

• for goods / services, the terms of the final settlement for which have not yet arrived;
• in the form of an advance payment transferred by the enterprise for goods / works on a contractual basis;
• employees who have received cash for household needs or business trips, but the deadline for reporting the expenses has not yet come.

Overdue receivables are called debts:

• for goods / services, payment for which has not been received by the company within the terms stipulated by the agreement;
• on the accountable amounts issued, if the employee did not report on the expenses incurred without submitting an advance report.

The overwhelming majority of overdue debts are settlements with counterparties, therefore, we will leave the proceedings with accountable persons to the accounting staff, who usually strictly control the financial activities of the company.

Overdue debt is classified as dubious and hopeless... Doubtful under Russian law is recognized as unpaid within the terms specified in the concluded agreement, a debt, the security of which, for example, by a pledge or surety is absent. This is how the Tax Code of the Russian Federation is interpreted.

In other words, unpaid obligations raise doubts depending on the business reputation and solvency of the counterparty: a permanent trusted partner may experience temporary financial difficulties and explain delays in payment, and it is not known how a client who did not pay for deliveries under the first concluded agreement will behave.

Such a dubious debt becomes a hopeless one, that is, impossible to recover, when the statutory deadlines for filing claims for its collection expire. According to the Civil Code of the Russian Federation, the limitation period corresponds to a three-year period.

There are several factors provoking the emergence of bad debts. It:

• liquidation of the debtor company;
• bankruptcy of an enterprise;
• the end of the limitation period;
• unrealistic collection even by a court decision (for example, the organization goes under operational management, although, as a rule, such measures are taken in the process of bankruptcy proceedings);
• availability of funds in the debtor's bank account, which is deprived of the opportunity to continue banking activities. It is well known that, at the initiative of the Central Bank of the Russian Federation, dozens of banks are subject to such a ban, so this factor will have to be taken into account.

When this situation arises, there are two options:

• if the Arbitration decided to liquidate the bank, and there is no cash to pay off the company's debt, then such a debt is recognized as uncollectible and is written off to losses. Note that this decision is made on the basis of documents provided by the debtor - court orders, information confirming the lack of funds, etc .;
• if the court made a decision to restructure the bank, then the company has the right to create a reserve for doubtful debts and wait for the situation in the bank and the debtor company to improve.

Accounts receivable on the example of municipalities of the Moscow region

We repeat that in the pursuit of conquering new markets and expanding activities, one should not forget about the usual caution and conclude contracts for the supply of goods or services (especially for impressive amounts) with companies that have established themselves as solvent partners with a well-known business reputation.

Note that organizations use all possible instruments to pay off overdue debts. For example, they provide a deferred payment / installment plan, carry out barter settlements, use shares and promissory notes.

Reflection of debt in the balance sheet

The financial report takes into account two categories of receivables:

• short-term, the payment of which is planned during the year. This is the predominant group, since it is extremely rare to practice deferral proposals for a period of more than a year;
• long-term, that is, the expected payment terms of which exceed 12 months.

This division is used in economic calculations when summing up the results of the company, determining the liquidity, credit and solvency of the company. We will not delve into economic categories, we will only note that the company's accounts receivable are an important component in the financial and production life of the company, affecting the final result of work and representing a part of the property, the dynamics of which requires the necessary control.

Hello! In this article, we will cover the basics of managing a company's accounts receivable.

Today you will find out:

• What are the accounts receivable;
• How to prevent its uncontrolled increase;
• Is it possible to sell receivables.

Essence of receivables

In any enterprise there are accounts payable and receivable. If everything is more or less clear with creditors, then the second option of obligations raises many questions from not only start-up entrepreneurs.

Receivables - these are debts of other parties (buyers, recipients of borrowed funds) to your company. That is, you are considered a creditor. For example, you have shipped the goods to your partner, but he has not yet transferred the money to the account. It turns out that he is your debtor: he has accounts receivable to you.

These obligations can be viewed in two ways. On the one hand, "accounts receivable" is the loss of the company, but on the other, it is future gain. It all depends on the correct financial management policy of the manager and the conscientiousness of the recipients of goods and services. A competent approach to existing receivables is the key to success.

Short and long term debt

Accounts receivable to an enterprise can be of varying duration. If your customers are up to 12 months late with payment, the debt is considered short-term. Its presence is present in 100% of firms.

Most often, it does not exceed several months (3 - 6). This is a normal phenomenon, since you can provide the counterparty with a deferred payment, or the money transfer is delayed due to holidays, the peculiarities of the bank through which the payment was made.

If you have shipped the goods and have not seen the money for it in the last year, there is a long-term commitment. They give reason to doubt the future solvency of the buying firm. In order not to miss this moment and get your money, you need to immediately choose reliable business partners.

The long term for the return of receivables negatively affects the entire enterprise. If you have a large amount of accounts receivable from several buyers, then things are very bad. This means that the funds in circulation are becoming less and less.

If a case comes when you urgently need funds, you will have to apply for a loan, which will make the situation of the company even worse.

Overdue obligation

When you conclude an agreement with future partners, you set an acceptable payment term for the services delivered. Due to the current circumstances, the buyer either transfers the money on time, or does not pay it at all.

The first case is ideal when the terms of the agreement are not violated. The buyer receives the goods, and you receive the money that you use for the purpose of the enterprise.

When payment is not received on time, an overdue receivable arises. Its presence makes your company more vulnerable, you are limited in funds and must support the company with the remaining money.

Claims receivable and refunds for the delivery or the goods themselves are valid for three years after the date agreed in the agreement with the partner as the due date. If for some reason you do not take this into account, then after 36 months the statute of limitations for the receivable will be canceled and the debtor company will write off the obligations to its income.

Doubt or hopelessness

If the debtor company is delaying the payment of obligations, you must figure out for yourself whether it is possible to collect your money from it or not. There is a concept of doubtful debt, which is expressed in the hope of receiving funds from the buyer. This is expressed in the fact that he has no signs, and for some reason does not want to return the debt to you.

The bad debt to the company consists in the fact that the company winds up its activities in the market and declares itself bankrupt. Then you will not be able to return your goods or money. In practice, such cases are rare and only with those managers who have failed to implement effective financial policies.

The period for writing off accounts receivable is three years, if you did not have time to file a lawsuit before the bankruptcy procedure, then you may not see your money either.

Doubts about the payment of funds by the debtor arise during lengthy negotiations, as a result of which he evades payment. In this case, re-delivery of the goods to his enterprise is not allowed in order to avoid the formation of a larger debt.

Before entering into an agreement with a new company, carefully study its activities in the market. If she has a history of unpaid obligations, then you should not ship. It is better to immediately prevent such cases than to deal with the collection of receivables later.

Objects of Obligation

Accounts payable are aimed at various objects of activity of enterprises.

Debts for:

• Supply of products, services or works;
• Promissory notes;
• Budget funds;
• Advances;
• Accountable amounts (for example, giving money to an employee to buy stationery);
• Loans for employees.

Thus, debt can be not only outside the enterprise, but also inside it. In addition, the form of obligations is common between the branches of one company.

The ratio of internal and external debt of debtors should be such that the firm can function normally. Internal debt is considered the most acceptable form of debt. It is much less than the external volume and, most likely, will be returned ahead of schedule.

For example, if you, as a manager, decide to lend to your own employees of your company at a low interest rate, then you can rest assured that such payments will be made by employees. Each of them is interested in further work, moreover, contracts that limit the possibility of early dismissal allow them to be retained until the end of payments. If you trust the amount to the accountable person, then you must give yourself an idea of ​​the possible consequences.

Why did the receivables arise?

The peculiarities of the functioning of firms at some stage lead to the formation of debtors' obligations.

This established practice has some common reasons:

• Inaccurate wording in contracts between the supplier and the debtor;
• Bad faith of partners;
• Payment delay;
• Credit for the goods.

The supplier may be to blame for the formation of accounts receivable. The manager should not allow phrases in the contract that can be understood in two ways. It is necessary to indicate clear terms for the return of receivables in such a way that the buyer does not have a single question. The drafting of agreements is usually carried out by competent and experienced lawyers who know all the intricacies of the field of law.

The fact of bad faith of the parties to the contract may not bypass even the largest and most well-known company. Dishonest managers who cannot cope with their job responsibilities always exist and bring a lot of trouble to other firms.

A deferral or a loan is normal conditions for the relationship between the parties. Accounts receivable in this case are repaid in accordance with the established terms. Provide such payment options only to verified businesses.

What can affect accounts receivable

There are various factors within the firm and outside it, which in one way or another can affect the nature of the debt repayment or the solvency of the debtor.

Internal sources include:

• Ineffective financial management policies;
• Inappropriate introduction of prices for goods;
• Untimely impact on the debtor.

As an external influence, you can consider:

• Inflation rate;
• Currency ratio;
• The economic crisis.

If your contract does not provide for measures of influence on a malicious defaulter, then the debt may not be returned at all. This important feature is made in a separate clause of the agreement.

Also, do not distribute goods in large volumes without monetary compensation to all debtors. You should try to avoid such moments. You can make a concession to a partner in whom you are confident.

Inflation can make your services more expensive. The price increase that is stipulated by the contract may lead the other party to the agreement to be confused and to defer payment. The economic crisis is also having a strong impact on the terms of the agreement already concluded. Depending on the current position of the debtor's firm on the market, the payment deadlines may not be met.

We manage debtor debts

The efficiency of the firm's activities directly depends on the structure of accounts receivable. You need to competently approach this issue in order to avoid unpleasant consequences of the enterprise, up to bankruptcy.

It is not just an organization's obligations to other suppliers that can significantly limit its operations. The share of receivables is also large here. In the process of managing it, the head needs to decide for himself what this management will consist of.

Be sure to include here:

• Creation of a special department at the enterprise, which will study the statistics of indicators;
• Understanding the tasks, functions and results of the policy of control of debtors' funds;
• Ensuring liquidity of debtors' obligations;
• Application of maximum attention to the turnover ratio of debtors' liabilities.

Detailed and thorough analysis of receivables should be carried out on a regular basis. This will help avoid unexpected disruptions in the development of the enterprise.

Who controls the cash flows of debtors

Any organization is interested in fruitful and effective cooperation with its counterparties. In order for this process to proceed at the proper level, several departments are created within the company that control the process of debtors' activities.

Previously, this function only belonged to the finance manager. However, enterprises are growing, concluding an increasing number of contracts, each of which becomes more difficult to control.

The internal composition of the firm that affects the receivables indirectly or directly:

• The highest link is the leader;
• Commercial department (persons concluding contracts with partners);
• Sales managers;
• Financial sector (head of the finance department and his subordinates);
• Lawyers;
• Security Service.

The main direction of work for all departments is set by the head. Commercial representatives are looking for the most profitable partners who do not have significant debts. Lawyers competently draw up contracts or study agreements proposed by opponents.

The security service is available only in large companies. Its tasks are considered to protect the interests of the company from unscrupulous persons and fraudsters through a thorough study of the client base.

Management tasks

Before starting any activity with counterparties, the enterprise needs to set tasks for itself that should be solved in the course of cooperation.

Such tasks in the management of debtor liabilities include:

• Studying the process of functioning of the future debtor (he must have a good reputation and be free from debts);
• Taking care of the upcoming drafting of the contract by a competent lawyer;
• Finding funds to finance emerging liabilities;
• Controlling the dynamics of indicators of receivables;
• Acceptance of ways to repay debts;
• Working with debtors in the form of claims;
• Opportunity to establish yourself at the state level for receiving gratuitous support.

Those employees who are involved in accounting and distribution of debtor funds should be able to:

• Use management objectives for the benefit of the organization;
• Ensure the fulfillment of the assigned tasks by 100%;
• Develop motivating offers for debtors;
• Control the current situation;
• Analyze the state of the company and send the report to the head;
• Plan the activities of the organization (we define the mission, strategy, decision policy);
• Appoint subordinate employees, each of whom will deal with separate areas of receivables;
• Compare the readings of the current state of the company with the planned one.

The instigator of any new action must be the leader. By appointing competent specialists who understand the intricacies of managing debtors' debts, he increases the chances for the rapid development of the firm's activities. Each skill and skill will come in handy for a positive customer experience.

Every account receivable management function is essential to your daily execution if you want your business to flourish. Management policy determines the future prospects for the development of the company at a high level.

What decisions are made for management purposes

By managing the flow of capital from debtors, the company must make effective decisions aimed at various aspects of the development of receivables.

Decisions are made on the following issues:

• Recording of indications of obligations for each specific date;
• Analysis of all actions preceding the occurrence of overdue receivables;
• Taking note of the latest developments in the field of accounts receivable management (every year there are new strategies developed by market gurus and aimed at increasing the turnover ratio);
• Regulation and control of the state of debts of debtors falling on the current date.

We provide liquidity of receivable assets

In order for the company to develop correctly and quickly, it is necessary to use all available assets in turnover. This condition also applies to receivables.

The very existence of obligations of debtors, with a competent approach, allows the company to increase its own resources and carry out its activities more efficiently. This means that having received funds from the next debtor, you must put them back into circulation. The debt that has settled for a long time in the hands of the debtor will badly affect your organization.

In order not to suffer from the liquidity of accounts receivable, it is best not to allow its delay or long-term return. The faster the money comes to the organization from the debtor, the higher the turnover of assets and income of the company will be.

An endless flow to debtors and back in a short time guarantee the successful existence of the company. The head of the finance department needs to competently influence buyers and motivate them to pay as soon as possible.

Turnover ratio and its characteristics

Accounts receivable are estimated by the turnover ratio. It displays the amount of revenue per 1 ruble spent. The higher its value, the less time it takes for the company to recover debts from customers.

To calculate the indicator, you need to find the average annual receivables: (liabilities at the beginning of the period + debts at the end of the period) / 2. The receivables ratio is equal to the ratio of the company's revenue to the average annual amount of liabilities.

The effectiveness of the accounts payable management policy is to increase the ratio.

For these purposes, you can:

• Increase revenue;
• Reduce accounts payable.

Using balance lines, you can express the formula for calculating the ratio as follows: line 2110 / ((1230 at the beginning of the report + 1230 at the end of the report) / 2).

For example, accounts receivable at the beginning of the period amounted to 3,000,000 rubles, at the end - 3,200,000 rubles. The average is: (3,000,000 + 3,200,000) / 2 = 3,100,000 rubles. The proceeds at the beginning of the period were equal to 2,300,000 rubles, at the end - 1,800,000 rubles. The turnover ratio will be in the first case: 2300000/3100000 = 0.74%, in the second: 0.58%.

In the above example, the ratio has decreased by 16%. This suggests that the business of the company is not developing in the best way. The ratio decreased due to a decrease in revenue, besides, accounts receivable increased by the end of the year. The company needs to analyze its activities and change the indicators for the better.

To calculate the ratio of accounts receivable turnover in days, it is necessary to divide the total number of days in the period by the ratio itself. For example, let's take the obtained indicators of 0.74% and 0.58%. Turnover in days: 365 / 0.74 = 493 days and 365 / 0.58 = 629 days. Predictably, by the end of the year, debt recovery to the firm began to take longer.

Growth of accounts receivable and decline in the development of the enterprise

The dynamics of indicators of the movement of funds of debtors to the enterprise and back plays an important role in the reporting of the company. The balance between accounts payable and receivable has its own subtleties and is different for each company.

If there is an increase in debts owed to the firm, then this phenomenon should be assessed in two stages. The first is the emergence of new partners, the enterprise's entry to a new level and active trade. A slight increase in the indicator in different periods is allowed and signals only a high-quality money management policy.

If the increase in accounts receivable reaches an uncontrollable level from period to period, then we are talking about an illiterate approach in interaction with partners. This process leads to a significant outflow of funds from circulation.

This can suspend the operation of the enterprise or limit it in capital. Further failure to take appropriate measures leads to a significant reduction in the company's assets and either bankruptcy.

The rapid growth in the number of debtors can lead to the fact that it becomes simply unprofitable to engage in the development of a neglected business. Such a company will bring a loss to the owner and jeopardize its continued existence. Therefore, it is necessary to regularly monitor, manage the movement of receivables.

Sale of receivables

Often in the course of its activities, a firm can act as both a creditor and a debtor. For example, you have provided cargo transportation services to a company that has not yet paid for your work. You, in turn, have received a certain product from a supplier, but have no funds to pay. That is, you are waiting for your debtor to return the money that you will transfer to your creditor.

This situation is often encountered, and therefore, at the legislative level, the right to assign a debt was invented, which greatly simplifies the process of recovering funds. This assignment is called an assignment. It turns out that you have ceded your debt to your own creditor. In other words, your debtor now has to pay off the creditor.

In this transaction, you are considered the assignor and the new creditor is considered the assignee. An agreement is concluded between you, which contains all the nuances of debt repayment. This action leads to the stabilization of the state of the enterprise and allows you to avoid unpleasant consequences in case of overdue debts.

We record accounts receivable

Usually the sale of receivables is made at a lower price. For example, if a buyer owes you 23,000 rubles, you can make an assignment in the amount of 20,000 rubles.

Accounts receivable in the event of a sale will be recorded using the following entry:

Also, the new creditor has the right to resell the obligations to the new person with a premium. In this case, the receivable is transferred to the account of another assignee.

This will be reflected in the transactions as follows:

Only the first creditor of the transaction has the right to resell the existing receivables. All subsequent resales will refer to transactions with the implementation of financial investments.

In the first case, the difference between the price of the original purchase of the liability and its sale will be used for profit tax purposes. In subsequent transactions, the entire amount of funds received will be taken into account.