Accounts Receivable: Management and Analysis (Portfolio 5111)

Description

This Portfolio explains and analyzes Generally Accepted Accounting Principles (GAAP) relating to the valuation and presentation of accounts receivable (AR), and offers insights on best-practices for the internal reporting of AR. The work also addresses the use of AR-related accounting information and provides practical examples of how this information may be used in statement analysis, credit decisions, forecasting, and similar activities. The Portfolio draws on a combination of authoritative literature on external reporting and research from practitioner and academic sources.

This Portfolio supplements and complements Bloomberg Tax Portfolio 5110, Howe and Mitschow, Accounts Receivable: Financial Accounting and Auditing (Accounting Policy and Practice Series). That Portfolio primarily addresses external reporting issues; the present Portfolio primarily concerns itself with the use of AR information for analysis and management purposes. The present Portfolio explores aspects of forecasting and valuation that go beyond the use of simple percentages and weighted averages to statistical techniques, which include regression analysis and Markov chains. Each of these approaches can be readily implemented through Excel.

Industry-specific factors influence the calculation and reporting of AR. The Portfolio thus discusses in detail practices that arise in numerous industries, including health services, construction contracting, agriculture, oil and gas, airlines, software and bundled products, franchising, hospitality, regulated utilities, retail, newspapers, casinos, insurance companies, real estate brokers, apparel, and food distributors.

This Portfolio may be cited as Bloomberg Tax Portfolio 5111, Howe and Mitschow, Accounts Receivable: Management and Analysis (Accounting Policy and Practice Series).

Table of Contents

I. Scope, Purpose, and Contents of Portfolio
II. Sales and Credit Practices Affecting the AR Balance
III. Bad Debt Expense and the Allowance for Doubtful Accounts
IV. Accounting for Accounts Receivable by Industry
V. Analysis of Accounts Receivable
VI. Computer Applications and Management Approaches to Accounts Receivable
VII. Trends in Managing AR