Study On E Company Account Receivable Management

In modern market economy, companies apply sales on credit as themeans to enhance competitiveness, raise market share, and grow salesvolume, which results in the birth of account receivables. Although the wayrealizes boosting sales, shooting up market share, and reducing inventory, atthe same time it also brings about side effects such as too long DSO,occupation of current cash, huge impact on working capital turnover andnormal operation, as well as financial risks increase. Consequently how toscientifically manage receivables becomes one of the key topics of modernenterprise financial management.The paper takes E company as example, analyzes in depth why accountreceivables will go bad with reference to some domestic and overseas researches of AR management, and study how E company optimizesreceivables through AR management system. Chapter1introduces ARmanagement research development of home and abroad, indicating currentAR management direction. Chapter2talks about AR management theoriesand risk factors. Chapter3focuses on E company AR management status andcause of problems. By understanding the root causes the company gets tofind the solutions. Chapter4is the main part. With E company management'scontinuous seek and trial, the AR management system is built up internally.Chapter5compares E company current status with history data so as tovalidate the feasibility and effectiveness of the system, look ahead into thefuture and suggestions. Chapter6summarizes the content, draws theconclusion. At the end, some limitations of the paper and direction of furtherstudy are touched.