Application Research Of Expected Credit Loss Model In Accounts Receivable Management

The Ministry of Finance revised the Accounting Standards for Financial Instruments in March 2017,and issued three new standards including Accounting Standards for Business Enterprises No.22-Recognition and Measurement of Financial Instruments,which will be implemented in batches from 2018.In the new standard,the previous practice of determining the provision for impairment of accounts receivable based on the historical loss method has been changed,and a new method of recognizing credit losses and accruing impairment earlier-the expected credit loss model is replaced.Since the release of the new model,there are few literatures on its application in the pharmaceutical manufacturing industry.With the outbreak of the 2020 epidemic and the normalization of the epidemic,the demand for the pharmaceutical manufacturing industry has continued to increase,and the accounts receivable have also increased significantly,and its management should also be more reasonable.This paper fills in the blanks of the above research directions and fields.On the one hand,it analyzes the application of the model based on actual facts,and applies it to pharmaceutical manufacturing enterprises.Recalculate the loss situation,make provision for impairment,compare it with the existing provision results,and judge whether the provision is reasonable.First,on the premise of clarifying the research purpose,background and overall thinking,this paper selects Watson Bio,a pharmaceutical manufacturing company listed on the Shenzhen Stock Exchange as the research object,explains the origin,parameter definition and applicability of the expected credit loss model,and compares The difference between the expected credit loss model and the incurred loss method;secondly,compare the evaluation results of the new model with the actual results,and analyze the application significance of the model from a qualitative and quantitative perspective;finally,integrate and reflect on the remaining problems of the model and its application issues that should be paid attention to and make relevant recommendations.This paper draws the following conclusions: first,the expected credit loss model is more accurate in judging the provision for impairment of accounts receivable;second,the expected credit loss model has limited effect on whether the credit risk can be sufficiently early warning;third,Certain judgments of the expected credit loss model lack objectivity.In response to the above conclusions,this paper puts forward suggestions: first,make adjustments to the changes in credit risk in a timely manner through dynamic management before,during and after the event;second,establish a multi-dimensional credit risk rating standard to avoid subjective assumptions;third,gradually Improve the revision of the guidelines and related policies,and improve the operability of the guidelines;fourth,strengthen the training of personnel quality;fifth,establish a dynamic credit risk management system based on big data to reduce manual operations and improve real-time performance.