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ABSTRACT
In the world of competition to be in the market is very important for any company. One of the measure to sustain in competition is to provide credit to the customers. The receivables of any company if managed effectively increase the current assets of company which lead to increase in the working capital of the company on the other hand if the company has excess of receivables it increases the costs by blockage of funds of the company. The study conducted on the sample of nine selected textile company for the period of 2004-2013. The result has been obtained by applying ANOVA for identifying the relationship between receivable management and working capital management of company. The study revealed that of all the receivables has significant contribution in current assets, total assets, sales and working capital of companies.
Keywords: receivables management, working Capital, current assets, total assets.
INTRODUCTION
In the world of competition to be in the market is very important for any company. One of the measure to sustain in competition is to provide credit to the customers as it help in not only retain customers but also increase sales. Among various components of current assets on is account receivable. This term can be defined as (Joy, 1978) "debt owed to the firm by customers arising from sale of goods or services in ordinary course of business." The receivables of any company if managed effectively increase the current assets of company which lead to increase in the working capital of the company on the other hand if the company has excess of receivables it increases the costs by blockage of funds of the company. Thus it is important to have proper account receivable by having reasonable collection period.
LITERATURE REVIEW
M. Kannadhasan opines that, The competition is a major challenge that every finance manager encounters during their working capital decision making process for optimum utilisation of scarce resources. To examine the effects of receivables management, it is important to note the difference between liberalised credit period and the profitability. It is the change in the investments in receivables level and costs involved in that creates crucial difference between these two. Therefore, the finance manager should take into cognizance the effect of credit policy...