A Study On The Qualicity Of Accounts Receivable

Accounts receivable has been becoming a normal asset for an enterprise. But due to poor liquidity of accounts receivable, cash flow and financing are seriously affected. Therefore, how to utilize the tool value of accounts receivable has become the key to the innovation in law. Generally speaking, accounts receivable financing system design appears as two kinds of paradigm: one is right pledge based on property law paradigm; another is credit assignment based on contract paradigm.Legislation style of pledge of creditor’s rights instead of accounts receivable is adopted by typical continental law system countries such as Japan and Germany. Concerning the pledge’s establishment and demonstration, the models of delivery or notification are adopted. The United States has established an unified chattel security trading system, while accounts receivable as a kind of intangible property has been included in the pledge of movable property. Unified registration was adopted as the methods of establishment and demonstration in guaranteed trading. The property law of our country imitated the concept of accounts receivable and registration system from the Uniform Commercial Code of USA, and set up the system of pledge of accounts receivable.Since we belong to the traditional continental law system countries, there are many differences between USA and us, such as legal structure, legal origin, historical tradition and logical thinking etc. It may lead to chaos in the legal system and logic thinking if legal transplant is only based on pragmatic. Controversies are lasting on the compatibility with pledge for accounts receivable. There are many defects in both aspects of jurisprudence and judicial practice. The extension of account receivable is difficult to determine, which will be in violation of the principle of Numerus Clausus. Lacking direct domination, accounts receivable is not in conformity with the essential attribute of property rights. It is difficult to guarantee transaction security and balanced conflicts of interests without effective method to declare the accounts receivable pledge. It is also difficult to ensure the realization of rights without uniform implement of the accounts receivable pledge. Therefore, accounts receivable is not compatible with pledge, which should be excluded from the objects of pledge. Accounts receivable financing system design should choose contract paradigm of credit assignment and abandon the paradigm of property rights pledge.