Debtors management : a critical appraisal of the general local situation

Abstract

Debtors management begins at the setting of the credit mission and goals, followed by the credit policy, the credit management process (involving credit screening, credit granting, risk reduction methods, cash collection, and reporting and monitoring of debtors), and ends at the debtors management performance evaluation. Through a questionnaire and interviews, the study looks into the details of this process within some local firms. The aim is to determine the effectiveness of local debtors management, as well as to understand the attitude of the Maltese businessmen towards this subject. For this reason, the results of the survey are considered in light of the theoretical aspects of the subject throughout this dissertation. Debtors will always try to delay payment to companies with poor or relaxed collection procedures. Is this the case in the local scenario? How many debtors end up as bad debts? These are a couple of the many interesting questions that are answered in the dissertation.