----------------------------------
Actually no. Unless they are seriously, fraudulently misrepresenting their position to the buyer.
Using accrual accounting they book the expense when the invoice is received and set up a liability in the subsidiary ledger which is combined to represent the accounts payable. The expense is already recognized but deferring payment will ease cash flow...for a couple months.
I read recently they were losing $100 million per year? This is a drop in the bucket in their total operating budget and the deferred payment will not have an effect on that.
“A drop in the bucket”
Yes, but I’ve been in those finance meetings where every department is expected to pony up and do their part to control the hemorrhaging.
This is usually when finance starts getting petty. They’ll eliminate use of company phones and laptops (except for management), forcing ordinary employees to use their personal phones and computers instead. They squeeze the vendors. They prohibit using short-term parking and taxis on business trips. Picking up a dinner tab requires VP approval in advance. That kind of petty stuff.
And even though the fixes amount to peanuts, they still get pats on the back from the CEO for “doing their part.”