MINISTRY OF EDUCATION AND TRAINING HO CHI MINH CITY UNIVERSITY OF TECHNOLOGY AND EDUCATION GRADUATION THESIS ACCOUNTING ANALYSIS FOR ACCOUNTS RECEIVABLE AND ACCOUNTS PAYABLE PERFORMANCE AT TAN THANH DAT INDUSTRIAL EQUIPMENT IMPORT EXPORT COMPANY LIMITED INSTRUCTOR: PHAM HIEU STUDENT: NGUYEN HOAI BAO PHUONG SKL012806 Ho Chi Minh City, May, 2024 MINISTRY OF EDUCATION AND TRAINING HO CHI MINH CITY UNIVERSITY OF TECHNOLOGY AND EDUCATION FACULTY OF ECONOMICS GRADUATION THESIS TOPIC: ANALYSIS FOR ACCOUNTS RECEIVABLE AND ACCOUNTS PAYABLE PERFORMANCE AT TAN THANH DAT INDUSTRIAL EQUIPMENT IMPORT EXPORT COMPANY LIMITED Performed by student: Nguyen Hoai Bao Phuong Student ID: 20125211 Class: 201251B Course: 2020 System : Regular Undergraduate Program Ho Chi Minh City, May 2024 INSTRUCTOR’S COMMENTS CRITERIA CONTENT PRESENT TOTAL POINT COMMENT. Ho Chi Minh City, May 2024 Signature ACKNOWLEDGMENTS During 4 years of studying Accounting at University of Technology and Education in Ho Chi Minh City, I have always received enthusiastic help and guidance from the teachers. From the first basic knowledge to the specialized knowledge, I have taken the first firm steps on the accounting path. I would like to sincerely thank all the teachers at the University of Technology and Education in Ho Chi Minh City for the time spent, especially the teachers of Faculty of Economics.
The teachers have provided me with a lot of useful knowledge, soft skills. I am not an outstanding student, so cannot fully absorb everything that the teachers have taught. But I will continue to strive to apply what has been learned into practical work and life. Currently, I have the opportunity to experience the practical work of an accounting intern through the internship at Tan Thanh Dat Industrial Equipment Import Export Company Limited.
During the internship here, the colleagues in the company have guided, provided favorable conditions for me to participate in practical work, while helping me reinforce the knowledge that has been taught by the teachers at the university. Especially, I deeply appreciate MBA Pham Hieu for his dedicated guidance throughout the thesis writing process. The teacher has actively helped, created favorable conditions, provided guidance and suggestions enthusiastically during the completion of this graduation thesis. Finally, I respectfully wish the teachers good health and success in their work.
Also, best wishes to all colleagues in the company for good health and many successes in their work. Sincerely thanks! Ho Chi Minh City, May 2024 Signature Nguyen Hoai Bao Phuong LIST OF ABBREVIATIONS Acronyms Meaning of acronym Acc Account AP Accounts payable AR Accounts receivable Co., Ltd Company Limited Cr Credit Dr Debit HCM Ho Chi Minh City VAT Value added tax VND Vietnam Dong LIST OF TABLES Table 2. Structure of account 131. Structure of account 133.
Structure of account 138. Structure of account 331. Structure of account 333. Structure of account 338.
Receivables improvement process. Debt collection period regulations of Tan Thanh Dat Co. Level of provisioning for overdue receivables. 94 i LIST OF FLOWCHARTS Flowchart 2.
Accounting cycle account 131. Process of reconciling accounts receivable. Accounting cycle account 133. Accounting cycle account 138.
Accounting cycle account 331. Process of reconciling accounts payable. Accounting cycle account 333. Accounting cycle account 338.
72 ii LIST OF FIGURES Figure 1. Logo of Tan Thanh Dat Industrial Equipment Import Export Co. The company’s main working screen on SMART PRO software. General ledger for account 1388.
General ledger for account 338. Analysis of accounts receivable aging report. Analysis of accounts receivable aging report. Analysis of accounts receivable aging report.
Analysis of accounts receivable aging report. Analysis of accounts payable aging report. Analysis of accounts payable aging report. Analysis of accounts payable aging report.
Accounts payable process. 95 iii TABLE OF CONTENTS INTRODUCTION. Reason for choosing the topic. Object and research objectives.
Structure of the thesis. 3 CHAPTER 1: INTRODUCTION ABOUT TAN THANH DAT INDUSTRIAL EQUIPMENT IMPORT EXPORT COMPANY LIMITED. General introduction about Tan Thanh Dat Industrial Equipment Import Export Company Limited. Formation and development.
Function and mission. Vision and mission. The future of operation. Advantages and disadvantages of the business.
Management apparatus diagram. Functions and tasks of departments. Accounting apparatus diagram. Functions and tasks of Finance - Accounting Department.
The current accounting policies in the company. 15 v SUMMARY OF CHAPTER 1. 20 CHAPTER 2: THEORETICAL BASIS OF ACCOUNTS RECEIVABLE AND ACCOUNTS PAYABLE. Concepts and tasks of Receivables and Payables Accounting.
The general theory of accounts receivable. The general theory of accounts payable. Tasks of Receivables and Payables Accounting. Accounting for accounts receivable.
Deductible Value Added Tax. Accounting for accounts payable. Taxes and other payables to the State. Evaluation indicators for financial management effectiveness.
Indicators for evaluating the efficiency of production and business investment. Indicators for evaluating liquidity ratios. 49 SUMMARY OF CHAPTER 2. 51 CHAPTER 3: CURRENT STATUS OF ACCOUNTS RECEIVABLE AND ACCOUNTS PAYABLE PERFORMANCE AT TAN THANH DAT INDUSTRIAL EQUIPMENT IMPORT EXPORT COMPANY LIMITED.
Current status of some accounts receivable transactions at Tan Thanh Dat Industrial Equipment Import Export Co. Current status of trade receivables. Current status of deductible Value Added Tax. Current status of other receivables.
Current status of some accounts payable transactions at Tan Thanh Dat Industrial Equipment Import Export Company Limited. Current status of trade accounts payable. Current status of Taxes and other payables to the State. Current status of other payables.
Analysis of accounts receivable and payable performance at Tan Thanh Dat Industrial Equipment Import Export Co. Analysis of accounts receivable and payable performance. The role of aging report. 77 SUMMARY OF CHAPTER 3.
86 CHAPTER 4: COMMENTS AND RECOMMENDATIONS FOR ACCOUNTS RECEIVABLE AND ACCOUNTS PAYABLE AT TAN THANH DAT INDUSTRIAL EQUIPMENT IMPORT EXPORT COMPANY LIMITED. Basis for making remarks. 95 SUMMARY OF CHAPTER 4. Reason for choosing the topic According to the World Bank’s Global Economic Outlook report for June 2023, the global economy is still struggling amidst the prolonged impact of multiple negative shocks such as the Covid-19 pandemic, the conflict between Russia and Ukraine, and tighter monetary policies to curb inflation.
The strategies that contributed to the global economic recovery in the early months of 2023 are expected to diminish in the later months of the year. This indicates that global economic activity for the entire year of 2023 will slow down, reflecting a significant deceleration in developed economies. According to the International Monetary Fund (IMF), Vietnam’s strong economic recovery process after the pandemic has been disrupted by both domestic and external headwinds. Vietnam’s economic growth is projected to slow down from 8% in 2022 to 4.
With significant short-term instability, policies need to focus on ensuring financial and macroeconomic stability, while accelerating the implementation of reforms. In a market mechanism with the participation of various economic entities as it is now, businesses face risks and challenges, requiring constant innovation to improve their strengths, define operational goals and business strategies that are suitable for their capabilities, and have production and capital utilization plans to achieve optimal efficiency. To achieve this, accounting work in the enterprise plays a crucial role in helping managers grasp the financial situation of the company. The increase or decrease in accounts receivable and payable has a significant impact on arranging the capital structure to ensure the normal business operations as well as the impact on business efficiency.
According to Jindal (2017), the management of receivables is a significant component of a firm’s working capital management. Presentstudy empirically examines the effect of efficiency of receivables management, measured by debtor’s turnover ratio, in the commercial vehicle industry in India on the firm’s profitability. Profitability was measured using Return on Capital Employed. The findings 1 indicate a significant positive relationship between debtor’s turnover ratio and profitability of the firm.
This implies that receivables management should be a key focus point for improving profitability in this industry. Besides, Gyasi Sah (2021) emphasizes the importance of receivables management on the performance of small and medium enterprises, especially in the economic context of Ghana, where these enterprises are located, contributing significantly to job creation and economic stability. Managing receivables not only helps optimize cash flow but is also a decisive factor in the success or failure of a business. Effectively managing accounts receivable and payable will help managers accurately assess the financial situation in terms of payment ability and capital mobilization, thereby contributing to the growth of the company's profits.
According to Tahirli (2017), despite the fact that accounts receivable management is quite a complex time consuming and difficult task, its proper management has its own ways of solutions which gives positive results to the company overall. The realisation of solutions on the way to the accounts receivable management is considered as one the main priorities of the company and its mistreatment would bring up to the failure of financial tasks. Recognizing the importance of accounting for accounts receivable and payable in enterprises, the author has decided to study the topic: “Analysis for accounts receivable and accounts payable performance at Tan Thanh Dat Industrial Equipment Import Export Company Limited” as the subject of graduation thesis. Object and research objectives Specific objective: - Understand the overview of Tan Thanh Dat Industrial Equipment Import Export Company Limited in terms of business sectors, organizational structure, management apparatus, etc.
- Theoretical basis of accounts receivable and accounts payable. 2 - Understand the current status of accounts payable and accounts receivable at the company, related processes, documents, and relevant ledgers. - Provide evaluation and comments on the accounts payable and accounts receivable at the company and thereby make proposals and recommendations to contribute to improving the accounting of payables and receivables at the company to enhance the efficiency of the company’s business operations. Research scope Research space: The topic is researched and implemented at Tan Thanh Dat Industrial Equipment Import Export Company Limited.
Research time: - Internship period: from July 2023 to September 2023. - Data collection time for research: From 2022 to 2023 at Tan Thanh Dat Industrial Equipment Import Export Company Limited. Research methods - Interview method: Directly ask the accountant about issues related to accounts payable and accounts receivable; invoices, documents, ledgers to serve research and thesis. - Observation method: Observe the work processes, accounting organization to understand the invoice processing procedures, accounting for transactions arising in the software, etc.
- Synthesis, analysis method: Collect data, synthesize and analyze to provide evaluation and recommendations on accounting at the company in general and accounting of accounts receivable and accounts payable in particular at the company. Structure of the thesis 3 In addition to the introduction, conclusion, and appendices, the graduation thesis: “Analysis for accounts receivable and accounts payable performance at Tan Thanh Dat Industrial Equipment Import Export Company Limited” is divided into 4 chapters: Chapter 1: Introduction about Tan Thanh Dat Industrial Equipment Import Export Company Limited Chapter 2: Theoretical basis of accounts receivable and accounts payable Chapter 3: Current status of accounts receivable and accounts payable performance at Tan Thanh Dat Industrial Equipment Import Export Company Limited Chapter 4: Comments and recommendations for accounts receivable and accounts payable at Tan Thanh Dat Industrial Equipment Import Export Company Limited 4 CHAPTER 1: INTRODUCTION ABOUT TAN THANH DAT INDUSTRIAL EQUIPMENT IMPORT EXPORT COMPANY LIMITED 1. General introduction about Tan Thanh Dat Industrial Equipment Import Export Company Limited 1. General introduction Company name: Tan Thanh Dat Industrial Equipment Import Export Company Limited Abbreviated name: TAN THANH DAT INDUSTRIAL CO., LTD Tax code: 3603621725 Address: No.
725, Hanoi Highway, Quarter 3, Long Binh Ward, Bien Hoa City, Dong Nai Province, Vietnam Representative: Vo Thi Thuy Phone number: 0384021465 Website: http://vandongnai.com/ Charter capital: 2.
