Research On The Import Payment In Foreign Exchange Process Of Tiangong Automotive Company

Tiangong Automotive Co.,Ltd.(hereinafter referred as “Tiangong Automotive”)is a large Sino-foreign joint ventures manufacturing passenger vehicles.With more than 20 years' development,Tiangong Automotive has become one of the largest companies of automobile market,whose products cover the mainstream niche.The purpose of this paper is to seek a solution to the present problems such as long payment period,incorrect payment,tax and compliance risks through the research on Tiangong Automotive's import payment process as a whole.To accomplish which,we have to study the import payment process as a whole.Hopefully,the optimization of the Tiangong Automotive import payment could inspire the other businesses of Tiangong Automotive and be used as a reference by similar businesses of other companies.Compared with its counterparts,Tiangong Automotive possesses competitive advantages of technology platform and advanced manufacturing capability,which are built upon the effective integration of foreign shareholder's technology and global supply chain,etc.As a supportive activity,Tiangong Automotive's import payment process is a critical node of the enterprise capital flow.It is closely related with internal departments such as procurement,production,research and development and budget management and external institutions such as banks,suppliers,shareholders,tax administration and administration of Foreign Exchange.The import payment of Tiangong automotive has a huge business scale and involves a number of business links and induces a wide range of influence.Analysis and attempt of process improvement from the perspectives of timeliness,accuracy and compliance is pivotal to protect and promote competitive advantages and control operational risks.With comprehensive business types and a large number of transactions,Tiangong Automotive has built a relatively complete process for import payment.However,the process is still encountered with issues such as payment difficulties,long payment period,tax risk and compliance risk.These will harm the relationship with suppliers,hinder the operational efficiency and weaken the competitive advantages of the joint ventures.The first reason causing these problems is the ambiguous division of work among multiple departments in Tiangong Automotive while the import payment business requires the cooperation of them.Secondly,the procurement contract terms of payment,service period,service locations,tax provisions directly impact the subsequent payment process.There is a lot of room for Tiangong Automotive to optimize in the aspects of tax audit,legal review and tracking management.Thirdly,the monotonous internal and external communication mechanism and channel builds an obstacle to information transfer and affects the efficiency of import payment.Lastly,the existing regulations of Tiangong Automotive are not updated timely and some of the articles are not fully executed.To improve and optimize the import payment of Tiangong Automotive,firstly a sound trans-department organization should be established besides the formal organization system in order to improve efficiency and reduce communication costs.Secondly,the management regulations of international procurement contract should be optimized.Dynamic tracking management should be built in the whole lifecycle to focus on the optimization of standard contract,settlement and contract filing,etc.Thirdly,the internal and external communication mechanism should be strengthened in terms of channels between inside and outside of the company,between departments,within departments,between upper and lower levels,and within same levels.Lastly,to prevent problems and risks in the long term,Tiangong Automotive has to constantly improve the institutional system,implement it strictly and establish a system of supervision and assessment.