Conceptual Foundations of Receivable Management

Paper ID: EIJTEM_2026_13_1_42-46

Author's Name: Dr.K.Devika, Ms.M.Kathija Begum, Ms.A.Meyarasi

Volume: 13

Issue: 1

Year: 2026

Page No: 42-46

Abstract:

Receivable management is a crucial component of working capital management that focuses on controlling, monitoring, and collecting amounts due from customers arising from credit sales. Effective receivable management ensures liquidity, minimizes credit risk, improves profitability, and supports sustainable business growth..Trade credit is considered as an essential marketing tool, acting as a bridge for the movement of good through production and distribution stages of customers Receivables, also termed as trade credit or debtors are component of current assets. When a firm sells its product in credit, account receivables are created account receivable are the money receivable in some future date for the credit sale of goods and services at present. As these late payment stretch out over time, they may cause substantial drop in a company’s profit margin. Since the extension of credit involves both cost and benefit, the firm’s manager must be able to measure them to determine the ultimate effect of credits sales. A company grants trade credit to protect is sales from the competitors and to attract the potential customers to buy its products at favourable and competitive terms. This paper presents a comprehensive theoretical discussion of receivable management.

Keywords: Conceptual Foundations, Receivable Management

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