Case Study On Accounts Receivable Securitization Of DZXX Company

The problem of financing for small and medium-sized enterprises has always existed.With the increase of the central bank’s reserve ratio and the rise of interest rates,the pressure of debt financing has risen sharply.Asset securitization provides a new financing path for modern enterprises,especially small and medium-sized enterprises.In asset securitization,the asset pool is composed of the homogeneity assets of the lack of liquidity,which is guaranteed by the stable cash flow of its future.The pool of assets is repackaged into securities and is issued to other investors,benefiting from its stable future income.Asset securitization came into China in the 90s of last century.At the beginning of the pilot,there was lack of relevant policy support and progress was slow.It was not until 2000 that there was a turning point.The people’s Bank approved several banks to conduct securitization experiments.With the successful release of the first securitization product in 2005,this is a milestone in the history of securitization.Later,because of the outbreak of the subprime mortgage crisis in the United States,the development of asset securitization in China was called a policy halt in order to prevent the expansion of financial risks.Until 20]2,it began to redevelop,and in the years after that,it was almost an explosive growth,and asset securitization was also known as the greatest financial innovation in recent years.Through securitization of assets,enterprises have not only consolidated funds,but also increased their popularity,providing more opportunities for enterprises.It is because this is a good strategy with multiple gains,so it has been developing vigorously in recent years.In 2015,the circulation was close to 200 billion yuan,and the circulation in 2016 was nearly 460 billion yuan,which doubled completely.In recent years,the balance of accounts receivable has increased year by year,and its proportion of current assets has increased.Although accounts receivable are the current assets of enterprises,they waste a lot of opportunity cost of enterprises.More accounts receivable will affect the company’s capital turnover speed,and cause some pressure on the company’s working capital.If the accounts receivable of the enterprise are securitized,then the stock assets of the enterprises are activated on the one hand,and on the other hand,the funds are provided for the enterprises to solve the financing problems.Therefore,it is of great significance to study this problem.It is hoped that the case study of this article will provide the company with a reference for securitization of accounts receivable.This article mainly focuses on the case of DZXX accounts receivable securitization,which includes six parts.The first part,first introduced the research background,expounded the significance of the research,and then made a comprehensive review of the theory of asset securitization at home and abroad,then described the ideas and methods of the study and illustrated the research methods,and finally explained the innovation of this paper.The second part describes the research progress of related concepts and theories of asset securitization.The third part analyzes the financial situation of DZXX company and the management status of accounts receivable,and concludes the necessity of DZXX company’s receivable asset securitization.Then,the case of DZXX company’s accounts receivable one phase asset backed securities is introduced.The fourth part analyzes the accounting treatment methods,innovation points and the effect comparison of DZXX company’s accounts receivable securitization cases.The fifth part,based on the case revelation of DZXX company,describes the four aspects of guaranteeing the real sale of accounts receivable,realizing the risk isolation,setting up the basic asset screening standard,continuing to pay attention to the payment of cash flow,and the long-term cooperation with the financial institutions in order to reduce the cost.The last part draws the conclusion that the asset securitization of accounts receivable is a new type of financial innovation product.In the process of securitization,we should pay attention to ensuring the real sale of accounts receivable and realize bankruptcy isolation,establish basic assets screening standard,disperse risk,and pay close attention to cash flow during the process of the project.Solvency,risk management and control,and long-term cooperation with financial institutions to reduce financing costs.Based on the conclusion,the future outlook of asset securitization is put forward.