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BHP Billiton Ltd  (NYSE:BHP) Accounts Receivable: \$3,781 Mil (As of Dec. 2016)

Accounts Receivable are created when a customer has received a product but has not yet paid for that product. BHP Billiton Ltd's accounts receivables for the quarter that ended in Dec. 2016 was \$3,781 Mil.

Accounts receivable can be measured by Days Sales Outstanding. BHP Billiton Ltd's Days Sales Outstanding for the quarter that ended in Dec. 2016 was 36.71.

In Ben Graham's calculation of liquidation value, accounts receivable are only considered to be worth 75% of book value. BHP Billiton Ltd's Net-Net Working Capital for the quarter that ended in Dec. 2016 was \$-44,211 Mil.

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

BHP Billiton Ltd Annual Data

 Jun08 Jun09 Jun10 Jun11 Jun12 Jun13 Jun14 Jun15 Jun16 Jun17 Accounts Receivable 6,577.00 4,620.00 4,979.00 3,722.00 3,031.00

BHP Billiton Ltd Semi-Annual Data

 Dec07 Jun08 Dec08 Jun09 Dec09 Jun10 Dec10 Jun11 Dec11 Jun12 Dec12 Jun13 Dec13 Jun14 Dec14 Jun15 Dec15 Jun16 Dec16 Jun17 Accounts Receivable 4,979.00 3,579.00 3,722.00 3,781.00 3,031.00

Calculation

Accounts Receivable is money owed to a business by customers and shown on its Balance Sheet as an asset.

Explanation

1. Accounts Receivable are created when a customer has received a product but has not yet paid for that product. Days Sales Outstanding measures of the average number of days that a company takes to collect revenue after a sale has been made. It is a financial ratio that illustrates how well a company's accounts receivables are being managed.

BHP Billiton Ltd's Days Sales Outstanding for the quarter that ended in Dec. 2016 is calculated as:

 Days Sales Outstanding = Accounts Receivable / Revenue * Days in Period = 3781 / 18796 * 91 = 36.71

2. In Ben Graham's calculation of liquidation value, BHP Billiton Ltd's accounts receivable are only considered to be worth 75% of book value:

BHP Billiton Ltd's liquidation value for the quarter that ended in Dec. 2016 is calculated as:

 Liquidation value = Cash And Cash Equivalents - Total Liabilities + (0.75 * Accounts Receivable) + (0.5 * Total Inventories) = 14090 - 62886 + 0.75 * 3781 + 0.5 * 3499 = -44,211

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Be Aware

Net receivables tells us a great deal about the different competitors in the same industry. In competitive industries, some attempt to gain advantage by offering better credit terms, causing increase in sales and receivables.

If company consistently shows lower % Net receivables to gross sales than competitors, then it usually has some kind of competitive advantage which requires further digging.

Average Days Sales Outstanding is a good indicator for measuring a company's sales channel and customers. A company may book great revenue and earnings growth but never receive payment from their customers. This may force a write-off in the future and depress future earnings.

Related Terms