一个战略方法在组织应收账款管理：一些实证研究【外文翻译】.doc

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1、本科毕业论文（设计）外 文 翻 译原文： A Strategic Approach on Organizing Accounts Receivable Management: Some Empirical EvidenceAbstract：In this paper, the organizational behavior in managing accounts receivable is studied. It is based on the recent surge of interest in trade credit management from both academics an

2、d practitioners emphasizing 1) the rather permanent character of these short-term but continuously renewed investments and 2) their strategic potential due to the existence of financial, tax-based, operating, transaction and pricing motives. The paper focuses on a search for sources of such a strate

3、gic value and for the determinants of its risk. More specifically this potential strategic value is said to create a need for flexibility and control in managing accounts receivable. It will therefore induce a need for internalization of its management. The resulting risks, however, favor its extern

4、alization. This results in a revision of the existing decision-making processes since, the extension of trade credit becoming a strategic asset, investments in accounts receivable cannot be judged by the financial needs incurred as measured by the traditional DSO-rate anymore. More specifically, a t

5、ransaction cost theoretic approach is used to explain the decision whether or not to internalize the firms accounts receivable management and its risk, resulting in a set of hypotheses to be tested on a sample of both large and medium-sized Belgian companies.1.Introduction Firms rarely require immed

6、iate payment for their merchandise. For example, in the UK corporate sector more than 80% of daily business transactions are on credit terms and accounts receivable constitute one of the main assets on corporate balance sheets (35% of total assets) (Summers and Wilson, 1997). As soon as trade debtor

7、s settle their accounts, cash flows into the company. At the same time, however, new sales generate new accounts receivable. The level of debtors thus remains constant when sales figures are stable, while it grows as sales figures increase (Grass, 1972). Although firms extending trade credit heavily

8、 invest in accounts receivable, the resulting financial need is not the only reason why trade credit decisions merit more careful attention. This paper develops and discusses two additional considerations.First, firms selling on credit open themselves to moral hazard. When exchange relations are sub

9、ject to imperfect information, this uncertainty results in transaction costs. Sellers thus have incentives to develop organizational structures that reduce the transaction costs resulting from this asymmetric information problem. Both home made planning and sales structuring as well as balanced prod

10、uct and market portfolios can reduce this uncertainty, while externalization of risk becomes attractive when these homemade institutions fail.Second, vendors offering trade credit have to adopt a variety of new responsibilities: the decision whether or not to grant credit to a (new) customer, the as

11、sumption of credit-, administration- and collection-policies and the bearing of the credit risk involved. From a managerial point of view this means that the seller 1) finances the buyers inventory, 2) engages in additional accounting and collecting activities, 3)monitors the financial health of bot

12、h existing and potential customers and 4) gets involved in assessing and bearing new risks. Not all credit management functions, however, have to be performed by the seller. Indeed, when extending trade credit is thought to add no real value to the firm, its management can be contracted to a third p

13、arty.A selling firms decision to extend trade credit thus also requires the seller to decide whether or not to integrate into managing accounts receivable. Moreover, when the seller decides to enter a market transaction, several organizational structures can be employed. In their paper, Mian and Smi

14、th (1992) examine the relationship between the functions to be performed in the credit-administration process and the decision whether or not to subcontract these functions to a third party specialist. In this paper, however, the extension of trade credit is looked upon from both a more strategic an

15、d a risk-oriented point of view. The strategic approach is based on the extensive financial management literature claiming that the extension of trade credit can become advantageous to the supplier, in which there will be a need for flexibility in managing accounts receivable. The risk-oriented poin

16、t of view, on the other hand, is based upon those principles that deal with the moral hazard problem. Finally, the implications of these motivational theories are linked to the industrial organization literature on vertical integration. Three types of outsourcing are considered. At first, the factor

17、ing contract has been chosen to operational the externalization of accounts receivable management, since factoring is the most comprehensive type of outsourcing a firms accounts receivable management. Next, we clearly isolate the decision to subcontract the administration process from the decision t

18、o subcontract the risks incurred, assuming that they are based on different decision processes with different decision variables. Indeed, we assume that both cost advantages and a need for flexibility in managing accounts receivable will cause integration of the firms credit administration. The assu

19、mption of credit risk, however, will not be delegated to a third party when the transaction can be performed in a stable and predictable environmental setting (inducing a low need for monitoring and control).In section 2 we describe the alternate accounts receivable management policies studied. Sect

20、ion 3 develops the hypotheses used to explain the decision to subcontract or not to subcontract the responsibilities involved. The discussion is based on the motives of sellers to offer trade credit and the moral hazard problem created by delaying payments under conditions of imperfect information.

21、Sections 4 and 5 describe the sampling procedure and the way in which the variables are measured, while the analysis procedures and results are reported in section 6. At the end of the paper, we summarize our conclusions.2.The Nature of Outsourcing ContractsBefore analyzing policy choices and their

22、respective determinants, we first give a description of the basic governance structures studied.2.1. FACTORING AND ITS EQUIVALENTFactoring basically offers three types of services: 1) finance, 2) risk control and3) sales ledger administration (Brandenburg, 1987). However, not all factoring contracts

23、 provide this full array of services. Based upon the scope of his managerial needs the seller can decide on the extensiveness of the contract. The most important distinction between factoring contracts is that between recourse and non-recourse agreements. A non-recourse agreement implies that the fa

24、ctor makes the credit-extension decision, monitors and collects the accounts receivable and bears the credit risk. Under a recourse agreement the firm selling on credit retains the risk of non-recovery of the debt. Moreover, when the contract provides financing, the factoring contract is called an a

25、dvance-factoring contract. A full-factoring agreement then is a non-recourse agreement, providing financing for all credit sales (both national sales and export). The equivalents internalizing their accounts receivable management finance their accounts receivable out of general corporate credit and

26、manage internally the credit-risk assessment, credit-granting, credit-collection and credit-risk bearing functions.2.2. THE ADMINISTRATIVE MANAGEMENT CONTRACTThe companies using an administrative management contract are defined as those companies that use credit information agencies to assess the tr

27、ade credit risks, to collect accounts receivable when they are due or ARF (Accounts Receivable Financing)-contracts and service contracts offered by a factor. Thus, although the administration of accounts receivable has been outsourced, the firm still bears the trade credit risk.2.3. THE RISK MANAGE

28、MENT CONTRACTThe risk management contract is defined as a contract that indemnifies firms against losses on uncollected accounts receivable but does not take care of the firms credit administration process. Examples of such third party specialists are e.g. credit insurance contracts and partial fact

29、oring agreements.3. Determinants of Alternate PoliciesFollowing the transaction cost approach, as developed by Coase (e.g., 1991) and Williamson (e.g., 1975), the transaction (or the exchange of goods and services) is the basic unit of analysis. Each time a transaction is performed, transaction cost

30、s arise. These can be defined as the negotiating, monitoring and enforcement costs that have to be spent to allow an exchange between two parties to take place and result from frictions or difficulties entailed by a combination of both human characteristics (bounded rationality and opportunism) and

31、environmental factors (uncertainty, “small numbers”, information asymmetry and asset-specificity). Therefore, alternative governance structures, of which markets and firms (hierarchies) are the most important examples, are assessed in terms of their capacities to economize on transaction costs (Jone

32、s and Hill, 1988; Williamson, 1975, 1987). This means that strategic assets are to be controlled by the firm itself. Next, internalization of an activity becomes more likely whenever there is a need for flexibility in its management since such a flexibility would make it extremely difficult to prepa

33、re full contracts (e.g., Hart, 1991; Klein, 1991).Uncertainty and/or bounded rationality, however, generate the opposite effect: parameters that are hard to control and/or increase the uncertainty in management are more likely to cause frictions and are therefore apt to externalization (Anderson and

34、 Weitz, 1986).As mentioned before, the factoring contract has been chosen to operational the full externalization of accounts receivable management. Next, we assume that the decision to outsource this management is influenced by the need for flexibility in extending trade credit and collecting payme

35、nts on the one hand and the existence of economies of scale and scope reducing the unit cost of management on the other. Further, such a need for flexibility and control is assumed to be induced by the existence of real motives for extending trade credit. Indeed, when these motives hold, trade credi

36、t contributes to the process of maximizing shareholder wealth, a traditional objective in financial management literature, and becomes a strategic asset that is not likely to be extended to a third party. Next, the effects of uncertainty and bounded rationality in managing accounts receivable are st

37、udied, assuming that the suppliers risk increases as a result of uncertainty in the customers payment behavior and uncertainty in the suppliers business environment. The less predictable the customers payment behavior, the higher the uncertainty in the suppliers financial needs, all other things bei

38、ng equal. Therefore, the assumption of the credit risk becomes less attractive whenever the customers payment behavior is hard to predict. In addition, two types of environmental uncertainty have been withheld: the possibility to control the customers payment behavior (based on the absence of inform

39、ation-asymmetry) and the possibility to spread the risks incurred. In the second part of this paper we clearly isolate the decision to subcontract the administration process from the decision to subcontract the risks incurred. Therefore, trade credit administration is described as the process of mon

40、itoring and collecting the outstanding accounts receivable. Moreover, since one cannot bear the consequences of decisions controlled by a third party, it is reasonable to assume that firms deciding to internalize the collection of their accounts receivable will also internalize the credit granting d

41、ecision. The risk assumption includes the assumption of all responsibilities in case of late and/or bad payments.3.1. THE DSO-RATESince in the traditional literature on accounts receivable management the average number of days sales outstanding (DSO) is often mentioned to be the primary reason for o

42、utsourcing, the DSO rate has been withheld for further analysis. Indeed, the pure financial theories on trade credit stress the fact that high DSO-rates increase the suppliers financial needs, increasing the likelihood of outsourcing. Moreover, it is reasonable to assume that when the firm has no ac

43、counts receivable (although it provides its customers with the opportunity to delay their payments), there wont be any need for outsourcing its management. This results in the following hypothesis:H1: Firms with a higher average number of days sales outstanding are more likely to outsource their acc

44、ounts receivable management.3.2. COST ADVANTAGESEconomies of scale and scope are expected to affect the outsourcing decision. Indeed, the fixed costs associated with credit-risk assessment and monitoring and collection policies can be spread over a larger number of accounts as credit sales increase.

45、 Firms with higher credit sales are therefore expected to invest in more specialized personnel, techniques and knowledge, enabling them to realize learning-effects. This results in the following hypothesis:H2: Firms with the potential of realizing economies of scale are more likely to internalize th

46、eir accounts receivable management.3.3. NEED FOR FLEXIBILITY AND CONTROL: THE INCENTIVES FOR TRADE CREDIT EXTENSIONThe more recent developments in accounts receivable management literature (e.g. Emery, 1988; Brick and Fung, 1984; Schwartz, 1974) all emphasize its potential strategic value which is u

47、sually translated into a set of motives causing trade credit extension. Among these we discern a pricing motive, an operating motive, a financing and a tax-based motive and a transaction motive. In what follows, each of them is briefly discussed and translated into testable hypotheses.3.3.1. The Pri

48、cing MotiveThe pricing motive is extensively described in Schwartz and Whitcomb (1978, 1979) and is based on the idea that both market structures and legal arrangements often restrict a firms profitability by constraining price competition in the market. In such circumstances trade credit not only b

49、ecomes an effective tool in creating hidden price-cuts; it can also be used to practice sub-rosa price discrimination (by extending different credit terms to different customers). This price-setting objective results in the following hypothesis:H3: Suppliers who use trade credit as a price setting variable are less likely to outsource their accounts receivable management.3.3.2. The Operating MotiveIn addition, the operating motive for the extension of trade credit assumes that firms with higher invent