Khitrov Pavel
Financial Director of LLC "Steel Industrial Company-M"

Due to the lack of systematic work with debtors, Steel Industrial Company-M faced an uncontrollable increase in accounts receivable and a decrease in liquidity.This problem was solved thanks to:

• creation of a procedure for assigning credit limits to buyers
• and systems of sales staff.

Prior to the introduction of the receivables management system at Steel Industrial Company-M LLC, information on customer debts could only be obtained from primary accounting documents (contracts, invoices issued). On the basis of this information, it was impossible to determine the amount and period of overdue receivables in the context of clients, which did not allow to control the conscientiousness of the fulfillment of obligations by individual clients.

The lack of a control system for accounts receivable also led to the fact that with an increase in planned sales volumes, sales managers increased accounts receivable by several times, lending products on credit. As a result, in January-February, when sales decreased due to the seasonal factor, the level of receivables exceeded the company's revenue.

Personal experience Olga Kanenkova Head of the Department of Accounting, Taxation and Consolidation of Accounts at Avtoframos JSC /RENAULT We had the same. The first inventory of receivables, carried out a year after the formation of our company, showed that it was impossible to understand what supplies were paid for and how much money could be received in the shortest possible time. At the same time, the amounts owed by both suppliers and buyers amounted to millions of rubles. To remedy the situation, the procurement system was changed: it was necessary to move away from advance payments to suppliers. Today, about 80% of all purchases in the company are paid after the fact. Partial advance payment is allowed only under investment contracts concluded for very large amounts (construction, purchase of equipment). A risk management system was introduced for customer receivables, which defined limits and the length of time a car was at a particular dealer without payment.

Work on the implementation of the receivables management system was started in 2005. Four main areas of work on receivables management were identified:

• planning the amount of receivables for the company as a whole;
• management of buyers' credit limits;
• control of receivables;
• employee motivation.

Accounts receivable planning

When compiling the company's annual budget, the planned level of receivables is determined in several stages. The allowable amount of receivables should not exceed 50 million rubles. This limit was determined based on the accumulated statistics of the enterprise for previous years. It is believed that if the set sales plan is fulfilled, then if there are receivables not exceeding 50 million rubles, the company will not experience an acute shortage of funds.

Personal experience Igor Parkhomenko Director of the Moscow representative office of OJSC EMAlliance At the plants of our holding, the planned volume of receivables is limited to 10-15% of sales. In fact, taking into account the specifics of production for each contract, an individual schedule of mutual settlements with the counterparty is maintained. Contracts, as a rule, are long-term, according to them, shipment volumes, terms and amounts of payments are known. Therefore, when planning, actual contract schedules with buyers, as well as suppliers working on a prepaid basis, are taken into account.

When forming the company's annual budget, the receivables limit can be revised, and, as a rule, in several stages.

The head of the commercial service, after analyzing the terms of the contracts concluded for the planned year, proposes to increase the amount of receivables in excess of a fixed amount. After that, for receivables in excess of the established limit, the cost of maintenance is determined - the company's expenses for servicing bank loans attracted to replenish working capital. When calculating the cost of maintenance, the highest interest rate of the entire loan portfolio of the company is applied. Then the additional sales volume for the current year is determined. It is assumed that these costs should be covered by profit from additional sales volume (in excess of the plan).

Example
Fixed level of receivables - 50 million rubles.
The planned sales volume is 1,500 million rubles. (50% growth is laid down).
The level of accounts receivable, at the suggestion of the head of the company's commercial service, should be increased by 50 million rubles. The cost of maintaining additional receivables is 6.5 million rubles. (50 million rubles x 13%, where 13% per annum is the cost of the company's credit resources).
The volume of sales required to cover the cost of maintaining additional receivables is 130 million rubles. (6.5 million rubles / 5%, where 5% is the average return on sales).
As a result, the requirements of the head of the commercial service can be satisfied, provided that the planned sales volume is 1,630 million rubles. (1500 million + 130 million).

The planned sales volume, determined taking into account the increased receivables limit, is agreed with the head of commercial departments.

Buyer Credit Limit Management

In most cases, work with a new client begins on a prepaid basis. After the statistics of payments and deliveries for the counterparty has been accumulated, he can be granted a credit limit.

Distribution of credit limits

The credit limit (the maximum allowable amount of receivables) is set for each of the commercial departments of the company, allocated according to the industry principle, in proportion to the share of revenue for the previous period in the total sales of the company and is approved by the order of the General Director. According to the same scheme, the distribution of limits among managers working with buyers takes place. Each of the managers, in turn, must distribute the credit limit received by him among the clients. As a rule, for new customers who work with the company for no more than six months, the credit limit is set at an amount not exceeding the average monthly sales volume. For counterparties working with the company for more than six months, the credit limit is set by the manager and is mandatory approved by the credit committee. Such a limit is accepted or rejected based on the data of the report prepared by the financial controller. The report contains the following information on the client:

1. Name of the client.

2. Date of commencement of work with the company.

3. Department (manager working with the buyer).

4. Profitability of the client.

5. Reliability of the client.

6. Average delay for a client, days.

7. Reliability of business, points.

8. Marginal profit, thousand rubles.

9. Number of shipments.

10. Number of shipments that are overdue.

11. Credit limit (if set), thousand rubles

Most of these indicators are used by many companies when deciding on the size of the credit limit. Let us dwell in more detail on the indicators of profitability, reliability of the business and the client.

Profitability of the client. This indicator is determined by comparing the markup of a particular buyer with the weighted average markup for all customers. If the debtor's margin turns out to be higher, he is assigned the status "profitable", if lower - "unprofitable". The use of the markup value in determining the profitability of the buyer without taking into account the volume of sales is due to the fact that the company has limited storage space and all stocks are sold in a month. Taking into account that all products will be sold, it is more profitable to work with companies that have a higher margin.

Drawing. Buyer Strategies

Client reliability. Based on the payment statistics for each client, a weighted average late payment period is calculated, which is then compared with the allowable period (5 days). Clients with a delay of less than five days are assigned the status of "reliable". For example, a buyer for three deliveries has the following payment statistics:

• delivery "A" - the amount of 1000 thousand rubles, delay in payment of 5 days;
• delivery "B" - the amount of 100 thousand rubles, delay of 15 days;
• delivery "B" - the amount of 500 thousand rubles, timely payment.

The average delay in this case will be 4.06 days (1000 thousand rubles x 5 days + 100 thousand rubles x 15 days + 500 thousand rubles x 0) / (1000 thousand rubles + 100 thousand . rub + 500 thousand rubles), therefore, this client will be classified as "reliable".

The allowable late payment period is set to reduce the risk of bias in relation to a particular client. So, if the company's average delay in payments turns out to be quite long, for example, 20 days, then a client who has delayed payment for 19 days may fall into the category of reliable ones.

According to the author, it is acceptable to use the median method when determining the allowable delay period. For example, if the delay time for five customers is 1, 2, 4, 7, 10 days, respectively, then the average period will be 4 days.

Business reliability. This indicator characterizes the reliability of the business of the debtor company and is estimated in points. The main source of information in determining it is the buyer's financial statements, submitted upon request. First of all, the presence of the debtor's fixed assets is analyzed. Their absence may lead to a refusal to provide a credit limit, since in the event of a bankruptcy of a client, the company will not be able to compensate for losses at the expense of his property.

The second most important indicator is the dynamics of accounts payable. Its increase for half a year by two or three times indicates that the company may experience a solvency crisis, and the loan will not be provided.

In addition, the duration of the buyer's work in the market, the growth rate of revenue and profit, as well as additional information from the sales manager who traveled to the client's office or enterprise are taken into account. Based on the results of a comprehensive analysis, the credit committee issues a score from 1 (“Business is unreliable, the threat of bankruptcy”) to 5 (“Very reliable business”).

Category 1 customers do not receive products on a deferred payment basis. Clients of category 2 (“Business is unreliable”) are considered risky, but they can be set a credit limit that does not exceed the marginal profit of Steel Industrial Company-M for this counterparty over the past six months, provided that other indicators of work with this company meet the requirements .

As a result of a collective discussion at the credit committee, based on the indicators of profitability, reliability and the previous volume of purchases, a credit limit for the client is established. The credit committee also adopts a strategy for working with one or another counterparty, depending on its profitability and reliability. Steel Industrial Company-M has identified four types of strategies for working with customers (see figure).

Using the described work strategies, the company can increase the volume of income and liquidity of the business.

Review of credit limits

The credit limits that may be provided by commercial divisions to customers are reviewed quarterly or semi-annually, depending on the situation on the metals market.

To revise credit limits, the indicator “Receivables Management Efficiency Ratio” (K ef.upr.dz) is used, which is calculated as follows:

K ef.management = (Average markup for the company / Average markup for the department) x (Average delay for the company / Average delay for the department).

The credit limit can be increased to the subdivision that, based on the results of work for the quarter (half year), received the highest indicator K ef.upr.dz. The subdivision, for which this indicator has the lowest value, the credit limit is reduced by the same amount.

By analogy, the credit limits of buyers with whom a particular commercial unit works are revised, but when calculating the efficiency ratio of receivables management, the formula changes somewhat:

K eff.control.dz \u003d (Average margin for the department / Average margin for the client) x (Average delay for the department / Average delay for the client).

Accounts receivable control

The financial controller daily enters data on payment for previously made shipments into the company's information system, which generates reports on customer debt. Reports on the status of receivables are generated in the information section "department - manager - client - accounts". They include information on the amount and date of shipment, the number of days of grace granted, the date of payment according to the plan, the amount paid and the amount of debt, the amount of overdue payment and the number of days overdue. A consolidated report is generated for the company as a whole, in which clients are divided into groups depending on debt limits and the number of days overdue for each of the payments 1 .

All operations for the management and control of receivables are automated using the company's own software development. The automation information system allows you to control more than 200 debtors of the company every day, spending about 20 minutes a day on it. During the use of this system, the number of debtors has more than doubled, but manageability has not decreased.

Personal experience Sergei Pustovalov CFO CJSCBridge town(Moscow) The control of the level of the credit limit of our company is carried out with the help of our own software development, created on the basis of "1C: Production Enterprise Management 7.7". If the payment deadline is missed, then shipments are suspended. The commercial department is given three days to solve the problem - the so-called "reaction time", then the client automatically enters the "stop list". For key clients, the response time is up to 10 days, but if the problem is not resolved within the allotted time, the client also falls into the “stop list”. Sometimes there are up to 100 companies in it. As the company's analysis showed, in most cases, the reason for late payments is not the difficult financial situation of the client, but the desire to use the seller's funds to finance their own activities. At the same time, company employees can refer to the inefficient work of the treasury, as well as to the forgetfulness and absence of key employees. In most cases, you can avoid such situations by sending a letter to customers notifying them of the need to pay off the debt. LLC "Steel Industrial Company-M" has developed standard forms of letters, the terms of sending and the content of which depend on the category of the client (new, reliable, VIP), as well as on the duration of the delay in payment. Letters are sent at the request of the financial director, but the opinion of the commercial director is taken into account. Letters can be sent to customers before the due date of payment (3 days in advance - reminder), after 3 and 5-10 days after the due date of payment (see figure).

The motivation system for employees of commercial divisions

The motivation of employees of commercial divisions is based on the possibility of redistributing credit limits. A department that provides the company with a high level of margins with a minimum delay in payment gets the opportunity to increase sales. At the same time, the remuneration of managers is a fixed percentage of sales volume and accordingly increases with effective management of receivables.

At the same time, if the credit limit allocated to the department is exceeded, a fine is imposed on the head. The amount of the fine is determined as the product of the amount of exceeding the credit limit by the refinancing rate of the Central Bank of the Russian Federation and by 10%.

Expert opinion

Sergey Shebek
General Director of Pelikan Consulting Group CJSC (Moscow)

The receivables management system implemented in the company is highly commendable. The system covers three main areas in this area of ​​financial management - planning and regulation of the amount of accounts receivable, control of its condition, work with unscrupulous debtors. We can recommend system developers to pay attention to two points.

First. It would be useful to classify the company's clients according to the business model they use. The trade and purchasing base, an industrial enterprise that purchases metal for the production of its main products, and a manufacturing company that buys rolled metal for its own consumption differ quite significantly. Such a classification would allow a better understanding of clients, the formation and use of differentiated methods for assessing their status and lending conditions.

Second. The authors of the system emphasize that the reasons for late payment of bills can be simple negligence, forgetfulness, poorly organized work of the treasury. In relation to this category of debtors, it is proposed to carry out methodological “sponsorship assistance”: to develop and transfer to clients drafts of internal regulations (memos) that determine the procedure for working with accounts payable, accepting and monitoring payment of invoices.

Enter the name of the client. If the names are duplicated, enter in the table a column with additional features - TIN, region or city, contract number.

In the second column, put down the code of the sign by which you will later track changes in the credit limit. Options could be, for example:

• 1 - the limit is previously valid, remains unchanged;
• 2 - previously existing limit, which is supposed to be reduced;
• 3 - the previously existing limit, which is supposed to be canceled;
• 4 - the previously existing limit, which is supposed to be increased;
• 5 - new limit, which is proposed for approval.

The commercial service increases the limits to retain customers or increase sales. Leave the limit unchanged when the situation with the buyer is stable - purchases are in line with the plan, the debt is repaid on time. The reason for lowering the limits may be a drop in sales, the client's failure to fulfill its obligations under the purchase plan, or the desire of the buyer to reduce the delay when the price is reduced.

Fill in your shipping information- in column 9, the calculation file will calculate the average monthly revenue. Take information on sales volume from the company's management accounting for past periods. For new customers, use plan data. the file will calculate the frequency of shipments, which reflects the regularity of purchases for each client. This is an adjustment factor for the average monthly sales figure, which must be taken into account when calculating the limit. For example, in a six-month analysis, it can be seen that customer No. 1 purchases products irregularly - on average once every three months, that is, in two months out of six. Accordingly, the correction factor is 0.5 (3 months : 6 months).

Specify the deferred payment - current and planned for the new limit. Request information from the manager of the commercial service or look in the contract with the client. For more information on how to calculate the grace period for a buyer, see. If you do not revise the limits, then the data in columns 11 and 12 will coincide. The file calculates the indicator of deferred payment in months - the credit ratio. For example, with a grace period of 30 days, the credit ratio is 1 (30 days : 30 days). This means that receivables cannot exceed monthly sales. With a delay of 21 days, the deferral rate in months is 0.7 (21 days : 30 days) - the buyer's debt should not exceed 70 percent of the average monthly sales volume.

Enter the planned sales growth rate as a percentage in. This indicator is needed to calculate the planned average monthly sales in rubles. Request data from the commercial service. In the same place, find out the percentage of crediting by client - the share of sales on the condition of deferred payment. Fill in - this coefficient reflects the terms of payment. For example, according to the contract, a delay is given to the buyer for all 100 percent of sales, or 50 to 50. In the latter case, the buyer pays 50 percent after the fact, and 50 percent - with a delay. The receivables limit under such a system is two times lower - only half of the shipment is credited.

Based on the above indicators the settlement file defines the new receivable limit, see . The formula rounds this standard to whole numbers. Set your rounding limit depending on the size of the company, for example up to 10,000, see column 19. Reflect it in dynamics - show how it has changed compared to the previous one, see column 20.

Andrey Borodin, director for economics and finance of the Moscow branch of TDL Tekstil LLC

Accounts receivable management

My experience indicates that this phrase is not entirely correct and requires clarification, namely - not thought out and unreasonable commodity credit policy without the necessary receivables management system spoils the relationship between the supplier and the buyer.

Commodity loans, in general, are today a necessary condition for the successful operation of the company in most markets. There are very few enterprises that can do without providing deferred payment, therefore, for most companies, the problem of managing receivables is one of the most relevant.

Definition: A receivable is a commercial loan to a buyer provided by a seller of goods or services.

Receiving payments from debtors is one of the main sources of cash receipts for an enterprise, and the higher the share of products sold with a deferred payment, the more important it is for the enterprise to effectively control the receipt of payment from credited buyers.

Example from consulting practice:

My dialogue with the director of company X:

Client - Once a month, when the accounting department submits information about overdue debts of our clients.

Client - VERY big problems!!! Overdue receivables account for more than 40% of the total customer debt! And how did you guess!?

The dialogue is typical for most projects, as companies turn to outside help when problems arise in many areas of the company's life, and the customer accounts receivable management subsystem is no exception. At the same time, the almost complete absence of control - an extremely rare analysis of the situation and, accordingly, an ineffective impact - guarantees the existence of problems in this area.

To help solve these problems and minimize the risks of their occurrence in the future, the development and implementation of an integrated system for managing customer accounts receivable can:

The main tasks of receivables management are:

Determination of the policy of granting commodity credit and control of its execution;

· determination of the policy of collection of overdue receivables, with the subsequent control of its execution;

· introduction of regulated processes for the provision of commodity loans, their accounting and control of returns.

When determining a credit policy, it is necessary to answer the following questions:

· What is the purpose of commercial lending?

· What types (segments) of buyers will we provide trade credits?

· What is the optimal amount and maturity of accounts receivable by type of customer?

• What evaluation standards to apply to determine the reliability of buyers?

In search of answers to these questions, one has to take into account that the more attractive credit conditions for customers, the higher the sales volumes of the enterprise, as a result of which profits will increase. But at the same time, it must be remembered that, while providing customers with large volumes of commodity credit and long repayment periods, the enterprise may simultaneously face the need to attract significant amounts of borrowed funds, which means that they incur significant financial expenses that can “eat up” all additionally received by increasing sales volumes. Additional profit from increasing the volume of sales by providing more attractive conditions should always be more than the cost of attracting additional funding.

Or a situation may arise in which a profitable enterprise, according to the Profit and Loss Statement, daily faces the inability to pay off its own debts to suppliers due to lack of funds in the current account.

That is, to select the optimal credit policy, the company must constantly compare the potential benefits of increasing sales with the cost of providing trade credits (the cost of debt capital to finance its working capital, the cost of credit checks, additional accounting and management costs, etc.), as well as the risk possible loss of solvency.

The process of managing receivables begins with the formation of the company's credit policy.

Credit policy should take into account:

· Strategic goals of the enterprise - increase in the volume of sales, maximization of profit from each unit of goods with the existing volume of sales, acceleration of asset turnover;

· The current market situation - whether the provision of loans is a common practice for competing enterprises;

· The competitive position of the enterprise in the market - whether the enterprise is a monopolist or is in search of new effective means in the fight against competitors;

· Features of distribution channels for goods and services - whether the company is focused on the implementation of predominantly one-time transactions, work with retailers or with a limited number of distributors who purchase regularly.

Stages of credit policy development:

· Determining the conditions for granting a trade credit by types or segments of buyers;

· For some companies, the formation of the so-called price matrix - a document that regulates the level of prices for a product or service, depending on the timing of its payment and the fulfillment of other conditions;

· Calculation of the maximum period for granting a trade credit;

· Development of the Regulations for the implementation of the Credit Policy.

Credit policy is designed to set the rules of the game in the following areas:

· To whom to provide credit - standards for evaluating buyers;

· Under what conditions - the dependence of the cost of goods on sales volumes, payment terms, fulfillment of other tasks set by the buyer;

· How much - determination of the credit limit;

· How to punish violators - what is the procedure for repayment of overdue receivables.

Credit selection of clients

The provision of commercial loans to everyone will not lead to an increase in profits, but, on the contrary, to its reduction - due to the growth of uncollectible receivables with their subsequent write-off and a shortage of funds for settlements with suppliers - due to delays in payment terms.

Therefore, determining to whom to provide a loan depends on the risks of non-return or delay in payment. Classification of buyers by risk groups - a kind of "foundation" of the credit policy.

One of the most common tools for solving this problem in relation to buyers with whom the company already has experience is the method of assessing credit history. It is based on the ranking of buyers according to a number of indicators and the establishment of criteria for making a decision on granting a loan.

Indicators for assessing credit history can be:

1. Type of buyer - distributor, wholesaler, retail chain, corporate client, one-time buyer, etc.;

2. The period of work with the buyer - a year, half a year, a quarter;

3. The period of existence of the enterprise-buyer - the number of years from the date of its registration;

4. Payment discipline - whether the buyer has receivables "older" than a certain period, for example, more than 3 months or the amount of overdue receivables;

5. The average monthly volume of purchases of the buyer (for the last year) or the share of purchases of the buyer in the total volume of sales of the enterprise;

6. Other indicators, such as the importance of the buyer, its location, belonging to a promising distribution channel or market.

For each indicator, a significance weight is determined. The sum of all significance weights is one. As a rule, the weights of the significance of indicators are determined on the basis of an expert assessment of the manager and/or a group of specialists.

All debtors are assessed for each of the indicators with a score in points (from 1 to 100). For example, debtors who have been cooperating with a supplier for more than five years will have a score of one hundred points for this indicator, from three to four years - eighty points, and so on. To standardize the scoring, it is recommended to compile a summary table of indicator scores.

Debtor	Indicators	Assessment of credit history indicators					Overall score
		Typeclient	Work period	Age of the firm	Payment discipline (% of overdue debt)	Purchasing volume
Units			years	years		thousand $
Specific gravity(example)		0,25	0,15	0,15		0,25
ALFA LLC	Evaluation indicator	Dealer
	Points						X
							96
LLC "BETTA"	Evaluation indicator	Wholesaler
	Points						X
							60
GAMMA LLC	Evaluation indicator	retail outlet
	Points						X
							39

Debtors, taking into account the overall assessment, are grouped according to the degree of their reliability:

Group A: overall score from 70 to 100;

Ggroup B: overall score from 40 to 69;

Group C: total score up to 39.

For clients group C a decision is made to ship the goods only on an advance payment.

For clients group B a decision is made on limited lending, an advance payment in the amount of a fixed percentage of the volume of shipment. As a rule, not less than 25%. Additional conditions: registration of bills of exchange, pledge, guarantee and so on.

For clients group A the possibility of shipment with subsequent payment on the standard conditions developed for this group is being considered, exclusive conditions are possible in case of strategic importance or expected future economic benefits.

The rating results also resemble ABC- and XYZ-analysis - the division into three groups is also obtained, the first of which brings the main part of the profit, the last - the least significant; at the same time, control over the accounts receivable of the third group is the least frequent (according to a certain commercial policy, this group should not have it at all), on the contrary, it is necessary to check whether the prepayment has been received.

For the second group, the control of receivables is less frequent, since this group sells a smaller volume of products, most likely, the frequency of deliveries is less, that is, the "control" points for checking - five days before the payment deadline, payment deadline, one day of delay - less than the first group.

Finally, the first group is likely to be monitored most frequently, such as daily.

Trade credit duration

Approaches to determining the timing of the provision of commodity credit may differ fundamentally.

Firstly , the timing of the provision of trade credit may be dictated by the market. For example, if the fictitious enterprise "Plombir and K" began to produce ice cream, then there are probably a lot of competitors-producers, and the enterprise does not occupy a leading position.

Most likely, the enterprise will have a limited list of regular distributors who shop with a regular high frequency, especially during the season, and they will probably also work with several other manufacturers. If other producers, especially those whose ice cream is more popular, unanimously say: deferred payment - ten days in the summer season, thirty - in the winter, then Plombir and K will have to provide conditions no worse, and already from the received planning period accounts payable turnover start when determining the target periods of inventory turnover and so on.

Or look for other benefits that can motivate distributors to buy Plombir and K ice cream with different credit conditions.

Secondly, an enterprise may have a “historical” terms for granting a commodity loan. In this case, in order to avoid dissatisfaction with regular customers, the company is unlikely to risk revolutionary changes in lending terms.

With the exception of cases when the credit policy undergoes radical changes in terms of other components - discounts, loan amounts, and so on, with the subsequent persuasion of buyers in the benefits of such conditions or "screening out" the "superfluous".

AND, Thirdly, suppose that the company does not have strict restrictions when setting credit terms, or is just revising its credit policy, in which the “starting point” will be just the credit term. In this situation, there will also be several approaches:

· on the basis of comparison with the actual and/or planned Accounts Payable Turnover Period (or operating cycle);

· Based on the comparison of marginal income with the cost of borrowed funds.

It is also important to take into account the fact that the provision of commodity credit to intermediaries is designed to provide an opportunity for participants in distribution channels to sell more of the supplier's products without being limited by the amount of their own free funds. But in no way should a commodity loan act as a free credit resource for the buyer. The duration of a commodity credit should take into account the period of the buyer's operating cycle, and, for example, a deferred payment for a point on the open market should be significantly less than the duration of a commodity credit for a distributor.

Trade credit limit amount

When determining the credit limit, you can be guided by the planned sales volume of the period, for example, set a credit limit for a month according to the formula:

Credit limit = planned sales volume for the month in value terms: thirty days X credit term

This implies that the loan term is determined in advance.

You can take as a starting point the volume of sales (receivables) of the previous period and the percentage of growth that the company plans to achieve in the current period, or apply any other approach that has a rationale.

Recall again that the content of each company's commercial policy will vary greatly depending on the company's goals, strategy, market, resources, and so on.

Accounts receivable management and control system

Once the commercial policy has been determined, it remains only to provide an assessment of its effectiveness and a mechanism for implementation.

Accounts receivable control includes:

Formation of the accounts receivable budget;

Formation of the register of "aging" of receivables;

· Monitoring the dynamics of the main indicators characterizing receivables.

The receivables budget is formed in the context of counterparties-buyers and / or business areas. Drawing up such a budget allows you to predict the level of receivables for the future period and adjust it in time.

An important point in the management of receivables is the formation of a database of information on receivables and the possibility of its analysis.

The aging register of receivables is formed by debtors and by business lines and allows you to evaluate receivables by different "age groups", determine the level and composition of "unfavorable" and / or overdue debts.

As for other types of current assets, receivables are usually assessed by turnover.

Accounts receivable turnover ratio (times):

Accounts receivable turnover period (days):

In order to determine the turnover ratio and the turnover period of "live" receivables, it is necessary to subtract the amounts of doubtful and bad debts from the amounts of receivables (for example, debts over 120 days).

Extending the receivables repayment period increases the likelihood of an increase in bad debts. An increase in bad debts reduces profits.

An increase in the period of repayment of receivables leads to a shortage of funds and increases the costs associated with attracting additional funds to finance current operating activities.

For performance evaluation with debtors, indicators such as the weighted average time of the overdue period and the credit period compared to the previous period can be used. When determining the weighted average time past due, doubtful and bad debts are excluded from consideration to ensure a fair comparison. It is obvious that an increase in the weighted average time of delay indicates a decrease in the efficiency of work with debtors, and a decrease - vice versa.

The illustration below was created during one of the consulting projects, and was intended to convincingly show sales managers the negative impact of excess customer receivables.

Figure 1. Consequences of excess customer debt

The execution of the credit policy should be regulated procedures and instructions which describe:

the actual regulation of interaction between the departments involved in the process of managing receivables;

actions of the personnel of these units and their powers.

This separation makes it possible to regulate the relationship between departments and the actions of personnel by addressing the relevant procedures And instructions directly to the performer.

One of the forms of regulation of the receivables management procedure can be a description and regulation in the form of a business process for monitoring the return of customer debts. Below is an example of a receivables recovery process map:

What to do if the client does not pay on time

Most receivables management policies state that if payment is not due on time, the first step should be to find out the reasons why the buyer is not paying.

Knowing these circumstances allows you to correctly place the emphasis in determining further actions so that in some cases, when the company does not want to lose a client, stop at the formation of a payment schedule or suspension of deliveries in order to further equalize relations.

Among the main factors determining why buyers do not pay their debts, the following groups can be distinguished:

First group. Reasons of an economic nature are the most relevant in modern conditions. The buyer is in good faith, but temporarily experiences a shortage of working capital due to crisis processes in the market.

Second group. The reasons are "political" in nature. The debtor has the means, does not refuse to pay, but does not pay on time. Delays in payment may be “normal” for a given company, for example, due to a monopoly position in the market or due to a significant preponderance in economic potential, which allows the company to impose its “style” of work. This may also be due to the peculiarity of the financial strategy of the debtor, who prefers to constantly "live in debt" and thereby expand his business.

Third group. Force majeure circumstances. The action of irresistible forces. Such factors can be not only natural disasters and natural disasters, accidents and other man-made disasters, but also the intervention of competent authorities. In real practice, we had to deal with a situation where, over the course of a week, the tax authorities carried out a total check of retail outlets in one of the large cities. The buyers were surprised that the windows of the stores, especially the smaller ones, turned out to be painted over with white paint, and the doors were decorated with “Repair” signs. Naturally, the enterprise that sold products through a retail network and had a high concentration of business in this particular city experienced an acute shortage of funds during the week.

Fourth group. Reasons for dishonesty. For example, the debtor initially was not going to pay off. Such debtors are most often dealt with by those companies that, due to the nature of their products, are forced to work with small customers or individuals. The idea of ​​non-payment in the process of development of mutual relations can also “overshadow” a large debtor, or he creates it artificially. This can be provoked by such actions: detection of miscalculations in the signed agreement, the presence of legislative "traps", the lack of sufficient control over the settlements by the supplier, attempts at unfair competition or due to the "defenselessness" of the creditor, and so on.

It should be noted that bankruptcy cannot be attributed to any one group, since although it occurs to a large extent for economic reasons, it can also be caused by the same force majeure circumstances and other non-economic reasons. Bankruptcy can also be of an unfair nature (fictitious bankruptcy).

Methods of influence

After the reasons are established, it is necessary to proceed to active actions, to determine which of the procedures of the regulation to focus on. The methods of influencing debtors are the most can be broadly classified as follows:

1. Psychological. The simplest - constant reminders by phone (fax, mail, etc.) of various emotional coloring (depending on the situation). Your debtor should know that you are concerned about the delay in payment. More complex is the dissemination of information about delays in payments among related suppliers and other interested parties or the use of various media (this is the most extreme case, resigned to the loss of a "notorious" buyer and commensurate with the cost of posting information and the amount of debt). Many firms understand that image losses are sometimes more expensive than monetary ones. At the same time, psychological influence is very effective for conscientious debtors.

2. Economic. Economic methods of influence include financial sanctions (fines, penalties, forfeits) and collateral relations. The pledge is the most effective lever of influence on the debtor, as it can be sold at a reduced price. If your regular customer violates the terms of payment, the first economic sanction against him may be the suspension of further deliveries or the subsequent boycott by other suppliers. It should also be taken into account that the suspension of supplies may lead to further deterioration of the financial condition of the debtor or to its bankruptcy. Therefore, the correct application of economic sanctions should be based on knowledge of the reasons why the debtor does not pay.

If he is a large enough customer, then maybe you should try to "earn" a little less on him today in order to receive additional income in the future.

3. Legal. Claim work, pre-trial correspondence and, finally, filing a lawsuit in court. In the event that your debtor turned out to be dishonest: he was engaged in fictitious business, forgery of documents and other criminal acts (fourth group), then the trial will be decided in your favor as soon as possible and you will most likely not receive your money, but only one more confirmation of the legitimacy of your claims in the form of a court order. If the debtor belongs to the first or second group (“good faith” non-payer), any legal proceedings may also be quite effective in terms of the return of funds, however, most likely, after such an impact, you can permanently delete this company from among your clients.

To whom to entrust the return of debts

Debt collection work is one of the most annoying tasks that needs to be delegated to someone. The choice of responsible for the return of overdue, but not yet bad debts for companies has several alternatives:

1. Financial service. Accountants and other financial workers know better than anyone about who, how much and, very importantly, how much time is owed, so there is always a "temptation" to dump all the menial work on financiers who are supposed to also know, and how to repay these debts. At the same time, a financial worker, who, as usual, knows the client only “on paper”, will treat all debtors equally: all telephone conversations or correspondence of such an employee will not be able to contain differentiated arguments and exhortations. While in one case it would be worth demanding, and in the other - only asking, and so on.

2. Legal service. Lawyers better than others understand the rights and obligations of their own and the client. They can very competently, from a legal point of view, correspond with debtors and present them with the most justified claims. But at the same time, such an important individual approach is again lost.

3. Sales service. These are the people who found the client, negotiated with him and came to some kind of agreement. Commercial workers (managers and sellers) not only know their customers by sight, but have an idea of ​​their character, potential, their “value”, the history of relations with the counterparty and many other nuances. At the same time, the seller is the same employee who gave the green light to the formation of debt. Therefore, it is logical if debts are collected not by those who take them into account, but by those who create them.

The financial service should take on only information support, notifying the sales service and the buyer in time about upcoming payments, and the sales service about overdue payments.

The legal service - to inform the sales service about the rights and obligations that the buyers have assumed and which belong to them by law, and if it is impossible to receive payment with "little blood" to carry out actions related to the transfer of the case to the arbitration court.

The role of the "first violin" in the return of "live" receivables should belong only to the sales service.

Evaluation of the effectiveness of methods of influence

Summarizing the statistics, observations and assessments of many specialists and practitioners in debt collection, we can compile the following table of the distribution of the effectiveness of using the most common methods of influencing debtors. At the same time, the efficiency of such methods differs significantly depending on the decency of the counterparty.

Table 2 Evaluation of the effectiveness of methods of influence in the return of debt

	Efficiency in %
Methods of influence	bona fide debtor	Bad faith debtor
1 . Verbal reminders (depending on intensity)	10 - 20
2. Written reminders (depending on intensity)	15 - 30
3. Filing a lawsuit in court (the fact itself)	20-40	5-15
4. Execution of a court decision	30 - 50	10 - 20
5. Fine, penalty, forfeit (depending on the size)	40 - 60	2 - 10
6. Collateral (depending on liquidity)	80 - 90	70 - 80
7. Probability of image loss	30 - 40
8. Suspension of deliveries	10 30	5 - 20
9. Interference by official and regulatory authorities (depending on the institution)	50 - 70	Credit limit is one of the key terms used in the field of lending. It denotes the amount to be issued to the borrower in debt at a fixed percentage. It shows how much cash they can give you, or how much will be transferred to a credit card account. The size of the credit limit is set by the lender based on information about the client's income and loan terms. Credit Limit Calculation The determination of the amount that the borrower can receive is made taking into account information about his solvency. The bank analyzes the data provided in order to calculate the maximum available loan amount. The estimated loan amount, together with is divided by the term of the loan. The result obtained is compared with the monthly salary of the client. If the value is more than 40% of the income, then the credit limit is reduced. But it can be increased by additional security (collateral or guarantee). So, when determining the mortgage limit, the bank takes into account not only the person's earnings, but also the value of the acquired property, which is used as collateral. The amount is usually set within 20-30% of this cost. When calculating the limit on the card, the lender mainly relies only on the amount of salary for 3-5 months. and the status of the requested credit card. Types and principles of the limit Distinguish between renewable and non-renewable limits. Non-revolving limits apply to consumer loans. The amount limit is set once. The borrower is obliged to repay the debt in full and close the loan. Revolving limits apply to credit cards. The owner of a credit card can use the funds within the limit until they exhaust them. With each replenishment of the account, it is renewed again. But this principle can be violated if credit conditions are not met, for example, by missing a payment. The amount of the loan may be reviewed if new circumstances arise. When a client violates one or more clauses of the contract, the limit is reduced. And they recalculate it upwards if the debtor's solvency increases, and he provides security, a maximum of documents during registration, has a good credit history. The impact of the limit on credit relations with other banks The value of the credit limit is of interest to all creditors for whose help you apply. The bank will certainly examine the data on your credit history. The presence of a large amount and information about the timely repayment of the debt will be a plus in assessing the borrower. If there are many open loans, including those with a revolving limit, then this will alert the lender. When calculating the available amount of borrowed funds, not only income and collateral will be taken into account, but also debts on existing loans. How banks determine the credit limit Credit policy can be tight (minimum deferral of payments or no deferrals at all) or liberal (providing a significant deferment of payments). The assessment of the reliability and profitability of buyers is based on an analysis of specific characteristics. The better these characteristics, the more profitable the buyer, the greater the limit can be given to him. The credit policy of an organization is a system of measures and rules that formalizes the procedure for providing commercial loans by an organization to its counterparties. Credit policy can be of two types: hard - providing a minimum deferment of payments or not providing deferrals at all; liberal - providing a significant deferred payment. Tough policy used by organizations that have a strong market position and do not experience problems with the sale of products. Her advantages— minimizing losses from outstanding receivables and debt financing costs. disadvantage tight credit policy is its potentially negative impact on product sales. liberal credit policy used by organizations operating in competitive markets and do not have significant market power. Her advantage- a stimulating effect on the volume of sales of products, i.e. this policy is a factor in the competitiveness of products. At the same time, liberal credit policy has a number of shortcomings: in particular, these are losses associated with losses from writing off receivables, expenses associated with debt financing and its servicing. Liberal credit policy has the following features: a long repayment period for receivables, for example, exceeding one and a half to two months; the presence of significant long-term receivables; a higher growth rate of receivables from buyers compared to the growth rate of revenue; the presence of debt written off at a loss and losses from debt write-off in the amount exceeding 1%, respectively, of receivables and revenue; reserves for doubtful debts. At the preliminary stage credit policy development market conditions are assessed and it is determined how beneficial the organization is to adhere to liberal policies. The following steps are carried out: determination of the limit of receivables for the whole enterprise; assessment of the reliability and profitability of buyers; determination of the receivables limit and the payment term for individual buyers; assessment of the effectiveness of the credit policy. Accounts receivable limit throughout the organization is calculated as the sum of the sources of financing of current assets available to the organization, minus the projected value of stocks, cash, short-term financial investments and VAT on acquired assets: DZ lim \u003d SOS + DO + K to + KZ - Z - DZ apr - KFV - DS, where SOS - own working capital; DO - long-term liabilities; To to - short-term credits and loans; KZ - accounts payable; Z - stocks and VAT on acquired values; DZ apr - receivables in terms of advance payments and other debts; KFV - short-term financial investments; DS - cash. The overall limit may increase at a faster rate than revenue if the organization moves to a more liberal credit policy. The assessment of the reliability and profitability of buyers includes thorough checks of counterparties at the stage of concluding contracts, as well as monitoring their financial condition during the term of the contract. The analysis of buyers who are granted a delay includes an assessment of two characteristics of counterparties: their reliability and profitability for the organization. Buyer Reliability Assessment is based on an analysis of their legal, financial, production and market characteristics: legal- the period of existence of a legal entity and the period of cooperation with the organization. The longer these periods, the more reliable the buyer, the higher his credit rating, credit limit and the period of deferment provided; financial- the level of debt overdue by the buyer for the previous period (the higher it is, the less reliable the client is); the dynamics of the buyer's accounts payable (if it increases significantly, the buyer's reliability decreases); Buyer's current liquidity, i.e. the ratio of its liquid assets and short-term liabilities (the higher it is, the higher the reliability of the client); production— availability of fixed assets, other assets, number of employees; the more production resources the buyer has and the more positive their dynamics, the more reliable he is; market— prospects for the market where the counterparty operates; duration of the organization's work in the market; stability of the market position of the buyer; buyer-controlled market share. The better these characteristics, the more reliable the client. Buyer benefit assessment is based on the analysis of its parameters: return on sales; share in sales volume, as well as dynamics of sales volume. The better these characteristics, the more profitable the buyer, the greater the limit that can be provided to him. To determine the aggregate assessment of the buyer, it is necessary to develop criteria for assessing the listed parameters. By summarizing these characteristics, buyers are ranked as follows: Profitable and reliable: maximum debt limit (high rank). Profitable but unreliable: Unprofitable, but reliable: average debt limit (average rank). Unprofitable and unreliable: minimum debt limit (termination of shipment on credit) (low rank). When setting a debt limit for an individual buyer, it must be taken into account that its share in receivables should approximately correspond to its share in the total revenue of the organization. To set the debt limit for buyers, the coefficient of reliability and profitability of each buyer is calculated. This indicator reflects the ratio between the buyer's share of debt and its share of revenue. Profitable and reliable buyers should have a larger share of receivables than their share in revenue, while unprofitable and unreliable buyers should have a much smaller share. For new buyers, the limit, as a rule, is set in an amount not exceeding the revenue received by the organization from this buyer for the month. The calculated limit for the organization is distributed among customers in accordance with their rating of reliability and profitability for the organization. limit per individual i-th buyer is calculated according to the formula DZlim i \u003d DZlim * d i * k nv Where d i- share i-th buyer in revenue; k nv - coefficient of reliability and profitability of the client; for reliable clients it exceeds one, for unreliable clients it is in the range from zero to one; for averages, it is approximately equal to one. Taking into account the calculated limit on i-th buyer is calculated the term of the delay provided to him according to the formula T lim di = (DZlim / Bi) * 365 To assess the effectiveness of the credit policy, the organization's losses from an increase in debt and gains from an increase in sales are calculated. Losses to the organization from granting a deferment as a percentage of revenue are determined by the formula n \u003d (r cr / 365) * D o Where r kr - annual interest for a bank loan; D o - the average period of deferrals provided. The company's gain from sales growth as a percentage of revenue is determined by the formula c = (∆O * m V ) / (1 + ∆O) where ∆ ABOUT— nominal volume growth rate, measured in fractions of a unit; m V- gross margin in fractions of a unit (the ratio of gross profit to price). Equating the gain to the losses, the minimum required increase in sales volume is determined when providing a deferred payment for a certain number of days: ∆ ABOUT= [(r / 365) * D o ] / [ m V -(r/365) * D o ] If the increase in sales exceeds the calculated one, then the liberal policy can be considered effective, since it allows the organization to increase its profits. For evaluation of the effectiveness of liberalization credit policy, according to financial statements, the increase in losses from an increase in receivables is calculated: ∆Z lp = Z otch - Z pr where Z otch, Z pr - losses associated with receivables in the reporting and previous year; usually calculated on the basis of credit interest (increase in the cost of financing receivables). Gain from liberalization policy is calculated by the formula: ∆V lp = ∆V * m otch * d lp where ∆В is the increase in revenue for the reporting year relative to the previous one; m otch - profit margin in the reporting year, calculated through gross profit; d lp - the share of revenue growth, which is due to the liberalization of credit policy; determined by experts. If the gain exceeds the losses, then the liberalization of credit policy can be considered justified, and the credit policy itself can be considered effective. Business and Finance 2023 emny.ru