Research On Working Capital Management Of Tianhe Coal Company

With the increasingly fierce market competition,companies in the coal industry should not only seek a place in the market,but also assume social responsibility,develop clean energy and reduce carbon emissions and other aspects of the requirements.Such a complex situation has launched more challenges and tests for managers and companies,but also put forward more requirements for the company’s working capital management.Once the working capital appears the problem,the company may fall into the capital chain break or stop the business.Based on this background,this paper starts with the study of the working capital management of Tianhe Coal Company,analyzes the scale of working capital and the status quo of operation management of the company,finds out the shortcomings of the company in working capital management,deeply analyzes the causes under the surface of the deficiencies of Tianhe Coal Company,and proposes management strategies that meet the actual situation of Tianhe Coal Company based on relevant literature.Help Tianhe Coal Company to solve problems and improve its working capital management level.This paper takes Tianhe Coal Company as the research object,uses case analysis and other analysis methods to analyze the financial data of Tianhe Coal Company from 2018 to 2022,and finds that with the gradual expansion of the company’s business scale,the sales revenue increases year by year,and the enterprise working capital management system has gradually failed to keep up with the pace of enterprise development.Problems in working capital management also become increasingly prominent,which are mainly reflected in the low execution of working capital budget,poor control of accounts receivable,too long payment cycle of accounts payable and inefficient use of monetary funds.Tianhe Coal Company’s working capital management method is in urgent need of change.This paper uses literature analysis to study and think about a large number of literatures on working capital,combined with relevant theoretical knowledge,through the surface of the problems of Tianhe Coal Company to deeply explore its essential reasons,and finds that the causes of the above problems mainly include the following four aspects: the company’s fund budget management system is not scientific;Lack of methods to manage accounts receivable;The company lacks the consciousness of win-win cooperation;Due to the lack of professional knowledge,the managers of the company pay insufficient attention to the management of funds.Based on the analysis of the problems and their causes,combined with the study of the channel theory and the summary of the countermeasures and methods in the literature,this paper puts forward some suggestions for improvement in line with the actual situation of the company in view of the problems existing in the company,hoping to correct or repair the problems existing in the company.The specific improvement measures include the following points: first,by broadening the management ideas of funds horizontally,increasing the control of the details of working capital management vertically,and strengthening the scientific nature of the working capital management system by combining the current and future prediction to determine cash holdings;Secondly,in terms of accounts receivable,the system construction should be improved.The strategies to be implemented include improving the customer’s credit rating system,strictly checking the source of credit sales,and improving the construction of accounts receivable management and control system and assessment system.Third,the core suppliers or strategic suppliers should shorten the payment cycle,take the initiative to show the sense of cooperation;Fourth,strengthen the professional knowledge reserve of the management and improve the working capital assessment mechanism to enhance the managers’ awareness of fund management.Through the above methods to improve the working capital management efficiency of Tianhe Coal company,for the long-term development of the company.