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Major Issues and Long-Term Mechanisms for Clearing up Debts in View of Payable Accounts Owed by Listed Companies (No.307, 2021)


By Ma Yuan, Research Institute of Enterprises, DRC

Research Report, No.307, 2021 (Tota l 6372) 2021-10-21

Abstract: Clearing up debts is a crucial measure for reducing capital occupation rate and supporting the sound growth of private and small and-medium-sized companies. To have a clear understanding of the amount of debt defaults, we collected data in the first half of the years from 2016 to 2021 covering 10618 listed companies. Facts show that the sum of payable accounts took up a stable share in total debts, over one fold higher than that of developed countries; and in the payable accounts, the proportion of payable notes rose continuously. By category, central SOEs, local SOEs and private enterprises were the main defaulters. By industry, IT, manufacturing, health care and social services and real estate were the industries with an increasing share in total debts. By region, both the payable and receivable accounts of enterprises in western China were on the rise. Survey findings reveal that debt defaults and debt payment and late payment still existed. This paper notes that based on previous regulations and debt clearing-up actions, targeted policies need to focus on different indebted entities and improve the mechanisms relating to ex-ante precautious measures, formative monitoring and ex-post audition plus credit punishment in a bid to strengthen the strong and binding force of policy implementation.

Keywords: payable accounts, payable notes, defaults, long-term mechanism