Factors Affecting Receivable Investment

Oct 13, 2025 by magicalceylontours.com 123 views

Introduction

In today's fast-paced business world, companies are constantly striving to achieve their main goal: profit. One of the key strategies to achieve this goal is through credit sales, which ultimately creates receivables for the company. However, when receivables are spinning, the company needs to ensure that its liquidity is maintained well. This can only be achieved if current assets are able to cover the entire company's debt. Therefore, it is essential to analyze the factors that affect the investment of receivables at PT Barata Indonesia (Persero) Mandiri Business Unit Medan.

Background of the Study

PT Barata Indonesia (Persero) Mandiri Business Unit Medan is a leading construction, trade, and services company serving projects from the government and private sector. With an operational center in Gresik, the company has been engaged in various business activities for several years. However, despite its growth in sales, the company's liquidity ratio has been relatively low, with an average value of 0.62 (62%) during the 2007-2012 period. This is far below the ideal figure of 2 or 200%. The company's management needs to identify the factors that contribute to this low liquidity ratio and take necessary steps to improve it.

Methodology

This study uses a descriptive research method with a case study approach to provide an appropriate picture of the object of research and the relationship between symptoms that occur, supported by quantitative data. The study aims to identify and analyze the factors causing the decline in the turnover of receivables, as well as efforts that can be made to overcome these problems.

Data Analysis

Data shows that during the 2007-2012 period, PT Barata Indonesia's liquidity ratio was still relatively low, with an average value of 0.62 (62%), far below the ideal figure of 2 or 200%. Although sales have increased, where the highest credit sales occurred in 2011 reaching Rp. 39,375,758,109.92, but receivables actually decreased. This decline can be seen from the total receivables that experienced a drastic decline in 2008 of Rp. 2,579,344,576.00 and the rate of turnover of receivables which plummeted to 2.09%.

Factors Affecting Receivable Investment

Several factors can affect the investment of receivables, including:

Payment Conditions: Companies need to provide attractive payment conditions, such as cash discounts or sales discounts, to customers.
Management of Receivables: PT Barata Indonesia (Persero) UUM Medan should form a management team that focuses on accelerating the process of payment of debt by customers.
Active Billing System: The application of an active billing system, through the debt collector, is also needed so that receivables can be managed more effectively.
Tighter Policy: Management needs to implement a tighter policy, such as providing fines for customers who are late in paying their debts.
Optimal Control: To control the investment of receivables so as not to affect liquidity, it is essential to carry out optimal control and ensure that the company's cash is sufficient to pay obligations.
Reserve for Uncollectible Receivables: The company must take into account the age of the receivables and allocate it as other receivables, as well as forming marketing staff to monitor and supervise existing receivables.
Determination of the Right Collection of Accounts Receivable: The determination of the right collection of accounts receivable must be considered so that investment in receivables remains within reasonable limits and does not burden the company.

Conclusion

Through a good analysis and management of receivable investment, PT Barata Indonesia (Persero) Medan Mandiri Business Unit can increase liquidity and remain competing in an increasingly stringent market. The company needs to identify the factors that contribute to its low liquidity ratio and take necessary steps to improve it. By implementing the factors mentioned above, the company can manage its receivables effectively and maintain its liquidity.

Recommendations

Based on the findings of this study, the following recommendations are made:

PT Barata Indonesia (Persero) Mandiri Business Unit Medan should implement a tighter policy, such as providing fines for customers who are late in paying their debts.
The company should form a management team that focuses on accelerating the process of payment of debt by customers.
An active billing system should be applied, through the debt collector, to manage receivables effectively.
Optimal control should be carried out to ensure that the company's cash is sufficient to pay obligations.
A reserve for uncollectible receivables should be allocated to take into account the age of the receivables and to form marketing staff to monitor and supervise existing receivables.
The determination of the right collection of accounts receivable should be considered to ensure that investment in receivables remains within reasonable limits and does not burden the company.

By implementing these recommendations, PT Barata Indonesia (Persero) Mandiri Business Unit Medan can increase its liquidity and remain competitive in the market.

Q: What is the main goal of this study?

A: The main goal of this study is to identify and analyze the factors that affect the investment of receivables at PT Barata Indonesia (Persero) Mandiri Business Unit Medan, with the aim of increasing liquidity and remaining competitive in the market.

Q: What is the research method used in this study?

A: The research method used in this study is descriptive with a case study approach, which is designed to provide an appropriate picture of the object of research and the relationship between symptoms that occur, supported by quantitative data.

Q: What are the factors that affect the investment of receivables?

A: Several factors can affect the investment of receivables, including payment conditions, management of receivables, active billing system, tighter policy, optimal control, reserve for uncollectible receivables, and determination of the right collection of accounts receivable.

Q: Why is it essential to manage receivables effectively?

A: Managing receivables effectively is essential to ensure that the company's liquidity is maintained well. This can only be achieved if current assets are able to cover the entire company's debt.

Q: What are the consequences of not managing receivables effectively?

A: The consequences of not managing receivables effectively can include a decrease in the turnover of receivables, a decrease in the liquidity ratio, and a decrease in the company's profits.

Q: How can PT Barata Indonesia (Persero) Mandiri Business Unit Medan increase its liquidity?

A: PT Barata Indonesia (Persero) Mandiri Business Unit Medan can increase its liquidity by implementing the factors mentioned above, such as providing attractive payment conditions, forming a management team, applying an active billing system, implementing a tighter policy, carrying out optimal control, allocating a reserve for uncollectible receivables, and determining the right collection of accounts receivable.

Q: What are the benefits of managing receivables effectively?

A: The benefits of managing receivables effectively include an increase in the liquidity ratio, an increase in the turnover of receivables, and an increase in the company's profits.

Q: How can PT Barata Indonesia (Persero) Mandiri Business Unit Medan remain competitive in the market?

A: PT Barata Indonesia (Persero) Mandiri Business Unit Medan can remain competitive in the market by managing its receivables effectively, increasing its liquidity, and implementing the factors mentioned above.

Q: What is the significance of this study?

A: The significance of this study is to provide insights into the factors that affect the investment of receivables at PT Barata Indonesia (Persero) Mandiri Business Unit Medan, with the aim of increasing liquidity and remaining competitive in the market.

Q: What are the limitations of this study?

A: The limitations of this study include the use of a single case study approach, the reliance on secondary data, and the potential for bias in the data collection process.

Q: What are the future research directions?

A: Future research directions include conducting a comparative study of different companies, using a larger sample size, and collecting primary data through surveys or interviews.