Liquidity Measurement Problems in Mining Companies

The ability to manage liquidity is important in any economic conditions. It assumes unique importance during a downturn and depends on management having reliable information on the company’s liquidity level. Static liquidity ratios do not provide such reliableinformation. Their high values result from high inventory levels of extracted raw materials and is not tantamount to excess liquidity.Additional information is offered by the cash cycle and its constituents – Days Inventory Outstanding, Accounts Receivable Days andAccounts Payable Days. Long cash cycles signal a shorter deferral of settlement of suppliers’ bills and a lower liquidity level. To maintain liquidity, companies must maintain higher cash balances in their accounts. Short cycles, on the other hand, may result from latepayment of invoices, which is reflected in long Accounts Payable Days. Some coal companies have very long Accounts Payable Daysand negative cash conversion cycles. This means that some of their non-current assets are financed out of current liabilities.

Managing accounts receivable and accounts payable

Предприятие обязано контролировать дебиторскую и кредиторскую задолженность, следить за сроками погашения, не позволять необоснованного роста суммы дебиторской задолженности, особое внимание уделять по истребованию просроченной задолженности, вести активную работу с контрагентами. Крайне внимательно относиться к расчетам с кредиторами, вовремя погашать им долги, в противном случае предприятие будут иметь штрафные санкции по расчетам с контрагентами – все это объясняет актуальность этой проблемы. Для повышения эффективности использования дебиторской и кредиторской задолженности нами разработаны мероприятия по управлению дебиторской задолженностью. A company must control accounts receivable and accounts payable, be sure to monitor repayment rates, not allow unreasonable growth of debtors and the amount of their debts, take timely measures to recover overdue debts, and actively work with debtors. It is also necessary to be extremely attentive to settlements with creditors, repay their debts on time, otherwise the company may lose the trust of its suppliers, banks and other creditors, will have penalties for settlements with counterparties – all this explains the relevance of this issue. To improve the efficiency of the use of accounts receivable and accounts receivable, we developed measures on managing accounts receivable.

Determinants of trade credit financing: a dynamic analysis comparing agri-food cooperatives and non-cooperatives

PurposeThe particular characteristics of agri-food cooperatives reduce their ability to access external financial resources. The purpose of this paper is to explore the factors influencing the agri-food cooperatives' trade credit operations by measuring their accounts receivable and comparing the results with agri-food investor-owned firms (IOFs).Design/methodology/approachThe authors apply a partial adjustment model (PAM) estimated using a dynamic panel model with a two-step general method of moments (GMM) estimator to a sample of 11,930 Spanish agri-food cooperatives and IOFs for the period 2011–2018.FindingsThe study concludes that cooperatives and IOFs have an accounts receivable target, which they attempt to achieve rapidly. Cooperatives tend to behave as IOFs do, but they present lower adjustment coefficients. This difference seems to be explained by the unique characteristics of cooperatives which set different economic and social goals, not just profit maximization as IOFs. The findings show differences between the financial and commercial purposes of the cooperatives and IOFs as a result of their internal management policies. Larger cooperatives with access to external financial sources, positive cash flows and operational necessities will grant trade credit.Originality/valueThis study gives interesting implications for cooperative managers and policymakers to help them to understand the strategies behind trade credit policies. Previous empirical studies on the agri-food sector are scarce and focus on IOFs without considering the role of trade credit in European cooperatives.

Value Added from the Perspective of Econophysics

The production, or value added, approach to GDP involves calculating an industry or sector’s output and subtracting its intermediate consumption (the goods and services used to produce the output) to derive its value added. The value added at the macro level depends on business efficiency. It reflects an increase in value that a business creates by undertaking the production process. We assumed that the market creates thousands of vibrating energies, coming from other enterprises, with different frequencies. The purpose of this article is to verify whether the econophysics approach could be successfully used to assess a business from the perspective of the interaction between economic forces. Thus, we propose that the term ‘value added’ be understood as a certain amount of accumulated energy of enterprises that comes from the interaction of basic economic forces and economic vibrating forces of accounting. Using regression models, we show the influence of basic forces, like debt and the stock market, and vibrating ones (i.e., accounts payable, accounts receivable, inventory) on the economic value added by testing US, European, and emerging markets. We confirmed the relevance and appropriateness of the econophysics approach to estimating the economic value added.

Economic diagnostics of accounts receivable and payable in the internal control system of the organization

Subject. This article considers the methodological aspects of economic diagnostics of accounts receivable and payable in the system of internal control of the organization. Objectives. The article aims to highlight the elements of economic diagnostics of the organization's debt in the internal control system and develop methodological approaches to the assessment of accounts receivable and payable. Methods. For the study, we used analysis and synthesis, induction and deduction, as well as comparison, logical generalization, systemic reasoning, and analytical forecasting tools. Results. The article presents an author-developed methodology of economic diagnostics of resources in settlements in the internal control system of the organization. It is based on an algorithm for assessing the dynamics of the turnover of accounts receivable and payable and monitoring their mutual ratio, identifying debt collection reserves, monetizing and forecasting the repayment of current debts. Also, for the operational systematization of information and effective control over the rate of change in accounts receivable and payable, the article offers developed forms of management reporting. Conclusions and Relevance. The developed methodology for economic diagnostics of accounts receivable and payable helps, on the basis of information on the changes in mutual turnover of obligations in the context of counterparties, identify available financial resources, determine possible reserves for debt collection, and make payment predictions. The results of the study can be applied when organizing the internal control system of accounts receivable and payable in the context of assessing the financial condition of the organization.

MANAGEMENT OF RECEIVABLES OF THE ENTERPRISE

The article examined the current state of planning financial obligations and noted the urgency of the problem of the existence of receivables. The urgency of the problem arises due to the presence of a significant share of receivables in the assets of enterprises. The emergence of a problematic issue is the reason for the search for new ways and methods of control over accounts receivable. The organization and methodology for accounting for receivables for goods is shown on the example of TOV "EMSS". We found out that most of the company's income comes from the sale of equipment for the road construction industry, in particular, testing and diagnostic laboratories. The organization of accounting and the main problematic issues of management accounting of receivables in TOV "EMSS" are investigated. The stages of work with contractors are described and the essence of each stage is described in detail. The stage of generating an invoice for payment is considered the moment of the beginning of the receivable to the seller. It has been established that the enterprise is most characterized by current accounts receivable for products, goods and services. At the same time, the company has no bad accounts receivable. The terms of payment for goods and services formed at the enterprise are described. The state and features of management accounting of receivables and their monitoring have been investigated. The main reasons for the origin of accounts receivable in TOV "EMSS" have been clarified. The necessity of work on improving the accounting of receivables and payables has been substantiated. Measures are proposed to reduce the occurrence of accounts receivable and recommendations for improving its information support are developed. The essence of the proposed measures is to automate the information base on accounts payable and receivable of settlement participants; discussion and inclusion in contracts of all obligations between the parties at the stage of concluding the contract; fast fulfillment of obligations for the supply of goods and services; prompt updating of the state of mutual debt, keeping records and reporting of ongoing mutual settlements.

Path Deduction and Countermeasure Analysis of Tunneling Behavior of Major Shareholders of ST Protruly Company

In recent years, China's listed companies make use of the defects of the information disclosure system, using direct or indirect means such as the appropriation of enterprise funds to carry out large tunneling cases are frequently exposed. Based on ST Protruly company, this paper analyzes the path of its major shareholders to implement the hollowed out behavior from the four perspectives: large prepaid accounts, large accounts receivable, large illegal guarantee and huge foreign investment, and then puts forward the measures to restrain the hollowed out behavior of major shareholders of ST Protruly company.

New Era of Accounting System based on Artificial Intelligence (AI)- Triadic- Entry Accounting

Triadic- Entry Accounting is not the term for it, there are considerable benefits in writing deals to an Artificial Intelligence (AI). Important like journal entries are presently recorded in an association’s subledgers (e.g., Accounts Receivable) and general tally, recording deals on an Artificial Intelligence (AI) would give visibility into affiliated deals.

Blockchain Technology Adoption in Supply Chain Finance

Supply Chain Finance (SCF) faces the complex problem of implementing inventory, purchase order and accounts receivable financing automation in terms of transaction data trust and validation. This paper aims to explore how blockchain technology adoption solves the SCF problem using a multi-case method based on the Technological Acceptance Model (TAM). With purposive sampling, 30 cases were selected on the criteria of perceived usefulness and perceived ease of use in solving SCF problems. The results show that trust, validity and distributed ledger transaction data as perceived usefulness are the main drivers of blockchain adoption because it provides solutions to SCF automation problems such as Know Your Customer (KYC), accounting, and transaction settlement. Smart contracts offer easy and fast transactions such as in L/C export processing as perceived ease to use. Of the 30 blockchain projects, 21 offer the usefulness of automated accounts receivable financing, 15 offer easy-to-use purchase order financing and 8 offer easy-to-use inventory financing processes. This study provides the current state of blockchain technology adoption by exploring 30 real application cases in SCF globally. Blockchain advantages provide automation solutions in global supply SCF practices with smart contracts, transparency and security of distributed ledger data feature.