Monitoring Accounts Payables

James A Gentry and Jesus M De La Garza

The Financial Review, 1990, vol. 25, issue 4, 559-76

Abstract: In creating shareholder value, one objective of management is to increase the speed of cash inflows and reduce the speed of cash outflows. To accomplish this task, management must understand the relationships that cause accounts receivable and accounts payable to change. The paper expands a receivable monitoring model by Gentry and De La Garza to incorporate the causes of changes in payables. Several examples are developed to show the operation of the model. The three primary contributions of the paper are (1) developing algorithms that measure the causes of changes in payables, plus an interpretation for each set of conditions; (2) showing that a present value approach to monitoring payables is superior to a recommended accounting approach based on variance analysis; (3) finally, presenting an approach for ranking the performance of payable and receivable strategies. Copyright 1990 by MIT Press.

Date: 1990
References: Add references at CitEc
Citations: View citations in EconPapers (2)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:finrev:v:25:y:1990:i:4:p:559-76

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0732-8516

Access Statistics for this article

The Financial Review is currently edited by Cynthia J. Campbell and Arnold R. Cowan

More articles in The Financial Review from Eastern Finance Association Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().