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Information C ommunication Technology in Finance

Credit control is a database and it tells the company when payments
need to be made. By implementing a credit control procedure manual
Boots are enforcing the company’s individual characteristics. They are
showing they have management and company values that will inform their
customers that they have presence, confidence, diligence, and that
they are prepared. Companies that have these values are less likely to
suffer from late payment or bad debt (aged debts). Controlling their
company’s credit, when they no longer control their debtors the cost
of financing their company’s cash flow is at the mercy of those very
same debtors. Boots need this because it tells them when their debts
need to be made so they wont get into deeper debts. If they didn’t use
this method the company could go bankrupt in a few months.

Forecasting

Boots need to use forecasting when they seeing what products will be
needed in the season because they will not buy furry body warmers for
babies in the summer, these will be used in winter time this will make
sure that boots do not lose any customers to other rivals

Supplier Payments

Supplier payments are payments that need to be paid to the company
they bought their stock of. So if Boots needed to pay supplier
payments this would mean that whatever supplier Boots bought their
food and drink of these are payments that are to be made to the
supplier. Boots gets sent an aged creditors report, this tells them
the aged debts, will show the Finance Department who the company owes
money to. This helps boots because they wont get behind with paying
money they own to different people, so they wont get into deeper debt
and that’s why Boots needs this type of method.

BACS (bankers automated clearing system)

BACS means that you can now pay the creditors directly into their own bank accounts. Increasingly suppliers are receiving payment directly into their Bank Account via BACS, the automated clearing system. This means that cleared funds are available on the day you are paid – unlike the time delay associated with cheques, there is no possibility of cheques getting lost or delayed in the post, you are saved the time and trouble of paying cheques into your bank account, accounting procedures are simplified and administrative costs reduced.

 

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