Why the Beta Pty Ltd Company Paid Commercial Credits

Preferably, there are laws that govern the use of business credits. The Beta Pty Ltd decision to sell the accepted bill of exchange was based on business laws. Since commercial credit is an intermediary firm that discounts bills of exchange and promissory notes, it was forced to take on the job of asset liquidation and valuation. Before considering the strategy, the company founded their arguments on the role of this firm. According to law of business, before a company can take any decision regarding to payment, there must be candid agreement between the two. This helps in avoiding risk which may be related to this disagreement.

The law of Bankers’ commercial credits argues that through using this method, the rights and the liabilities of the companies involved in this agreement. The Beta Pty Ltd Company had better intention over the credit payment by the Alpha Pty Ltd Company. The parties could extensively benefit from the financial trade benefit which is a supported concern globally. Most of companies across the world have implemented the use of commercial credit support which is by no means innovated. It is true that payment of the bills may be a perpetual fight between related parties in a business environment. The commercial credit firm plays a central role in strengthening a strong relation between the two parties. The Alpha Pty Ltd Company and Alpha Pty Ltd Company could continue transacting together while solving the delayed payment of the debt.

Basing argument on the case presented between the two companies, the Beta limited company believed that this could favor them in terms of financial improvement. Engaging with the commercial credit can help resolve the financial problems among the companies. Section 8 Cheques Act 1986 (Cth) presents the ideology that usage of this strategy would lead to greater understanding between the companies which increases the appreciation of the financial status of the company. Since the Beta Company was at an unfavorable financial balance due to the unpaid debt by Alpha Pty Ltd, application of this strategy could help them recover the debt in a short period. This could be possible since the Alpha Pty Ltd could pay the debt without any difficulty. The act also presents the idea that through applying strategy, a company can benefit from requisite of efficient deliver and essential endorsement which is a beneficial factor in payment of debt. The Alpha Pty Ltd could find it easy to compensate for the long term debt it owed the Beta Pty Ltd Company.

The company also based their decision on the cost of accessing the commercial credit firm and other methods of demanding for payment. Through using this method, the Beta Company could reduce their expenses in compensating for the debts owed by the Alpha Pty Ltd Company. In a normal business environment, demand for payment of requires costly procedure with a lot of paper work. This policy can help a company to cut off the cost on accessing the debts. The Beta Company, targeted on this benefit since the commercial credit firm could help them retrieve the debt from the Alpha Pty Ltd Company.

Remedies of Beta Pty Ltd

The Beta Pty limited company has taken vital remedies regarding to this decision about the prolonged debt by the Alpha Company. Ideally, before a company can sign an agreement, it must understand the terms and condition of the agreement. The Beta limited company took an extra mile in assessing the economic importance of the commercial credits in resolving bills and debts. The agreement between the bank and the Beta Company was made after extensive consultation by the Beta limited company. This means that the company had weighed the benefits and the risks of this agreement before presenting it to the Alpha Pty Ltd for signing and implementation. This was a strategic remedy by the Beta Company to insure their assets from risk of loss and safeguard the interest of the company.

Consequently, the Beta limited company also considered the legislation of this procedure. There was a close monitoring of the commercial credit firm activities in resolving the debt issue. In a law regulated business environment, both parties must understand and sign into the agreement. This was a similar remedy by the Beta limited company as it closely regulated the activities of the firm. The major regulation was initiated by the credit codes that ensured that there would be no cards rigging within the period of credit recovery. The credit cards also provided additional remedy to this facility as it could differentiate between the customer’s transaction and the business transaction. The code was very selective; in fact it was completely efficient in this case.

The Beta limited company also presented civil practice of law and regulations of the firm. The company hired several auditors to regulate this process. This was to prevent the hampering of the acceptance policies and agreement by the conflicting legislation act. The Beta Company was aware of future changes in the regulation of the firm activities. There was a need for earlier acceptance of the regulatory policies; the Beta Company ensured that the firm could not alter the policies regarding the management and payment of the debts. This was a vital remedy by the Beta limited company as it could safeguard the interest of all the parties.

In conclusion, the case was a lawful business policy which is acceptable. In this case, the Beta limited company made an appropriate decision to initiate this policy into management of their outstanding debt. As a matter of fact, both the parties could enjoy and benefit from this policy. Significantly, the Beta limited company implemented relevant remedies towards success of the policy. The Alpha limited company however on the other hand the Alpha Company could pay the debt in a simple way as it benefit from the products of the Beta limited company.