Internship Report on Invoice Processing and Its Impact on Cash Flow Management of Uttara Foods and Feeds Pvt Ltd

Abstract

This internship report presents a three months attached with Uttara Foods and Feeds Pvt. Ltd.,delves into how invoice processing impacts cash flow management. The key purpose of thereport isto assess the effectiveness of the company’s invoice processing operation and to assess theeffectsthe invoice processing has on the company’s liquidity, financial liabilities and operational capability.The study highlights that the invoice processing system of Uttara Foods and feeds is highlyin-efficient as it suffers from various problems like delayed bill generation, billing irregularities, poorfollow up of collections, no automation, etc. All these problems have resulted inlengthenedcollection periods, disrupted cash flow, and financial distress, which are especially damagingtotheprocurement and production functions. Accounts receivable turnover, which for the past fourteen quarters has been decreasing eachquarter,had an average collection period of 81-plus days, much higher than the industry average. Further, 43to 46% of the monthly receivables were overdue in the study period, which has a challengingimplication in terms of the control on credit and managing of the receivables. The report recommends the use of automation tools, enhanced cross-departmental communication,more stringent credit control policies and regular employee training to facilitate a better invoiceprocessing process. These efforts are to collect the overdue balances and fetch more cash, whichcanhelp in improving the health and survival of a company ,by enhancing the effectivenessofprocessing invoices, Uttara Foods and Feeds Pvt. Ltd, which is critical for improving its cashflowsituation, mitigating financial risk and providing long-term business stability. By adoptingthesuggested plans, the company may lead to less reliance on external financing and set it upforoperational success and growth.