A review of supply chain financing has been launched by the Australian Small Business and Family Enterprise Ombudsman, Kate Carnell.
It’s expected that the review will examine the ways in which small and family businesses can use supply chain financing to manage cash flow and fund growth, while also looking at how big businesses are using this tool.
Ms Carnell says that while supply chain financing is a helpful tool to free-up cashflow for small and family business, it’s not intended for use by big businesses as a “replacement for reasonable payment terms”.
“The review will investigate whether supply chain finance is being used by big businesses as a means to stretch forma payment terms and as a strategy to manipulate the reporting of working capital and cash reserves,” she said.
An interim report is due for release in March 2020, with the full report to be released by the end of April 2020.
To read the full scope of the review, visit- asbfeo.gov.au/reviews/supply-chain-financing.