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-   -   Trade payables means all payables ? (https://www.askmehelpdesk.com/showthread.php?t=828986)

  • Nov 25, 2016, 12:22 AM
    heshan1997
    Trade payables means all payables ?
    I have to calculate trade payable payment period for a given financial statement. In it they haven't given trade parables directly, instead there is a figure called “other liabilities”.
    Other liabilities consist of -


    1. Policyholder Advance Payment
    2. Agency Commission Payable
    3. Government Levies Payable
    4. Reinsurance Creditors
    5. Other Creditors Including Accrued Expenses
    6. Outstanding Claims - Life Insurance.

    When taking trade payable into consideration should I get the total of other liabilities or just "Other Creditors Including Accrued Expenses" ?
    Please help
  • Nov 27, 2016, 11:10 PM
    paraclete
    Well I expect you have a total for liabilities, but this seems to be an insurance company so what constitutes "trade"? The statistic you are trying to calculate is intended to give a measure of the degree the organisation is using trade credit to finance the business and how well they manage cash flows. I think you need to think about materiality and it is likely the big ticket items are
    1. Agency Commission Payable
    2. Government Levies Payable
    3. Reinsurance Creditors

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