中级会计双语Chap007分析.ppt

To summarize, transfers of a receivable may be accounted for as either a sale of a secured borrowing. Transferors usually prefer to use the sales approach rather than the secured borrowing approach because the sales approach which removes the receivable will make the transferor seem less leveraged, more liquid, and perhaps more profitable than the secured borrowing approach. First, companies must distinguish whether the arrangement to finance with receivables is a transfer of specific receivables of simply a pledging of receivables in general as collateral for a loan. If it is a transfer of receivables, the critical element is the extent to which the company surrenders control over the assets transferred. GAAP requires three conditions to determine if control has been surrendered: Transferred assets have been isolated from the transferor—beyond the reach of the transferor and its creditors. Each transferee has the right to pledge or exchange the assets it received. The transferor does not maintain effective control over the transferred assets. If these three conditions are met, the transfer may be recorded as a sale which means that the receivables are removed from the books, proceeds are recorded, and any gain or loss is recognized. If any of the three conditions are not met, the transaction is treated as a secured borrowing. The U.S. GAAP and the IFRS approaches often lead to similar accounting treatment for transfers of receivables. Both seek to determine whether an arrangement should be treated as a secured borrowing or a sale, and, having concluded which approach is appropriate, both account for the approaches in a similar fashion. However, where they differ is in the conceptual basis for the choice of accounting treatment and in the decision process required to determine which approach to use. Now we’ll discuss two ratios that are commonly used by managers, financial analysts and investors to evaluate receivables management. The receivables turnove