Credit Risk: Financial instruments that possibly subject the Company to concentrations of credit risk consist of cash equivalents and receivables. Due to its large and varied customer base and its geographic diversity, Saputo has low exposure to credit risk concentration with respect to customer’s receivables. There are no receivables from any individual customer that exceeded 10% of the total balance of receivables as at March 31, 2015 and March 31, 2014. However one customer represented more than 10% of total consolidated sales for the year ended March 31, 2015, with 10.2% (one customer with 11.4% in 2014). Allowance for doubtful accounts and past due receivables are reviewed by management at each balance sheet date. The company updates its estimate of the allowance for doubtful accounts based on the assessment of the recoverability of receivable balances from each customer taking into account historic collection trends of past due accounts. Receivables are written off once determined not to be collectible. On average, Saputo will generally have 10% of receivables that are due beyond normal terms, but are not decreased. However, Saputo management does not believe that these allowances …show more content…
Since Saputo has already entered into a Swap, another option for Saputo is to enter into interest cap option. The payments are designed to offset interest rate increases on a floating-rate loan. A protective collar can also help accomplish interest rate risk. Collaring is accomplished by simultaneously buying a cap and selling a floor (or vice versa), just like a collar protects an investor who is long a stock. A zero-cost collar can also be established to lower the cost of hedging, but this lessens the potential profit that would be enjoyed by an interest rate movement in the company’s favor, as it would have placed a ceiling on its potential
- If all of the options were explored, and patient is given antibiotics and is treated without any pain or suffering than the treatment identifies with the ethnical principles of autonomy, non-maleficence, and veracity. In turn, Mrs. Dawson will be happy with the outcome of the procedure.
The figure below shows the liabilities of Domino’s pizza in the past 5 years. It is very distinct that the company has a large amount of liabilities relative to assets, which worth to be examined with more diligence, especially the 97% of restaurants franchised and fewer prospects to
KEDA was founded in 1992, mainly into manufacturing of Ceramics Machinery. The other major offerings by Keda involved stone processing, building materials processing and energy resource management. They had more than 2000 employees and a broad product offering by 2010. In this industry, managing infrastructure for inventory was of extreme importance because of the various, customizable offerings across multiple plants. It had become a world leader in building materials machinery by early 2000s. All the units including sales & marketing, logistics, production & inventory was acting separately. Thus for a sustainable business, it was highly important to move from decentralization to a centralized system. For this purpose
Accounts Receivable has good separation of duties and strong internal controls such as control numbers and reconciliations to sales and bank statements. One weakness in the Accounts receivable system is the accounting supervisor approves summary entries and reconciles the general ledger account, which could indicate a weakness with segregation of duties. We recommend that the controller approves of summary entries to segregate these duties.
Selling receivable before its maturity date to financial institutions or factoring companies is one of the company’s strategies to obtain an immediate cash and make company’s operating cycle becomes shorter. For providing this service, the financial institution or factoring company requires a compensation such as interest, commission fee, and other requirements to secure the transaction. Consequently, the amount of money received by the company, as a seller or transferor, less than the face value of the account receivable, or it purchases at discount. Selling receivable transaction can be executed either without recourse in which the transferor has no obligation for uncollectible receivables or with recourse in which the transferor has full responsibility for any uncollectible receivables.
The management culture is a very important factor in the imprinting of a company: it shapes the relationship between working environment and employee satisfaction. I will answer a few questions regarding the SAS's particular strategy of running the business in which the employees are unbelievably loyal, thanks to the benefits and cares that they receive from the employer.
Natura is a premium, high-margin cosmetics and personal care product line that are mostly sold to middle/upper class demographics. They believe that by using natural ingredients, they can deliver what customers need and want (Enhancement of their well-being and natural beauty).
The case study identifies several aspects of the Nissan response that were beneficial. Identify the potential costs and benefits of these actions. What else could Nissan have done to prepare for and respond to the disaster? Articulate the cost and benefits.
This result suggests that companies can improve profitability by reducing the amount of receivables outstanding day. This can also be interpreted as the least the time it takes customers to pay their bills, more money to refill inventory, therefore, the greater the sales realized leading to a high profitability of the firm. There is a negative relationship between the average collection period and profitability explain that an increase in the number of accounts receivable of one day per day is associated with a decline in
(b) Possible risks that can lead to material misstatements in the financial statements if business risk related to the operation are not managed effectively (Telecommunications)
Prakash and Sinha (2013) particularly view shareholders’ understanding of a change in deferred revenue that goes up because of customers’ prepayment. That deferred revenue included expenses that are not part of the cost of product and services and therefore the increasing mismatch between the revenues and expense. This mismatch affects both depresses margin when the deferred revenue and inflates margin when the earning period is accomplished.
PO was in group as scheduled and minimally participated in the group activities. . PO learned problem-solving technique that include defining the problem; examining obstacles; acting on the choice; learning from the results. PO was not willing to engage in the small group exercise. PO appears to have a hard time/understand that effective problem solving is an important life skill. P’s behavior and participation are consistent with the pre-contemplation stage of change.
All the more particularly, this decides the ability to absorb misfortunes, fund its extension, pay profits to its shareholders, and develop an adequate level of capital. Being front line of defense against the destruction of a capital base from misfortunes, the requirement for high profit and earnings can scarcely be overemphasized. Although diversifying pointers are utilized to fill the need, the best and most broadly utilize indicator is a Return on Assets (ROA). ROA is employed by establishments and banks to outfit them with an important instrument for evaluating their progress, including utilization of assets and financial quality (Haque, 2014). Then again, for inside and out examination, an alternate pointer Net Interest Margins (NIM) are likewise utilized. Chronically unfruitful money related establishment’s hazard bankruptcy. Contrasted and most different pointers, inclines in gains can be hard to decipher for cars, abnormally high benefit can reflect excessive danger
Credit risk management is essential for every financial institution to ensure its safety and soundness or avoid bankruptcy, in other words. For example, the recent financial crisis in 2007 truly saw the collapse of huge amount of businesses over the world. On the contrary, firms which have good CRM policies can rescue themselves from significant impacts of the crisis. The meanings of managing credit risk are mainly related to three aspects: survival, profitability, and return on equity.
Due to the nature of the services that salesforce offer, the production capacity is virtually limitless, this is because only one unit of the product is made. Once the software is released, only copies of the software in various forms is distributed. As a whole, the software industry has a different perception of economies of scale. Most of the costs are linked to software development and marketing. However, marginal costs when distributing are very low. Salesforce is no different and practically, it is difficult to find the data which quantify those costs and Salesforces’ ability to utilize Economies of Scale. Even in Learning Economies it isn’t possible to quantify the unit costs as the learning is not in the production of the solution offered