In: Finance
Reflecting on the focus and content of this course Risk Management, what is an important challenge facing the financial management of organizations today, and how would you go about addressing it? Explain.
The business of today are facing with the challenge of control the rise in Accounts Receivables in the Current Assets, under the Financial Management, which will lead to higher finance blocked in the Current Assets and rise in financing costs. The rise in the Accounts Receivables every year will demand more and more finance each year. The Current ratio has been rising every year.
The solution of such rise in Current Ratio on the upward movement of Accounts Receivables is that
1) Have a strict credit on the sales.
2) Sales would not be repeated to the Non-paying Clients.
3) The credit days on the Accounts Receivables should be compensated through taking higher credits from the supplier.
4) Lower interest and risk fund are to be raised so that rising Accounts Receivables are being financed.