What can be a consequence of poor accounts payable management on a business?

The correct choice highlights several significant negative outcomes that can result from ineffective accounts payable management. When a business does not manage its accounts payable efficiently, it often encounters cash flow problems. This may arise from delayed invoice processing or failure to take advantage of early payment discounts.

As cash flow tightens, the business may struggle to meet its financial obligations, leading to late payment penalties imposed by vendors. These penalties can further strain the company's finances and impact its profitability. Additionally, consistently late payments can damage relationships with suppliers. Vendors may begin to view the business as unreliable, which can lead to restrictions on credit terms, increased prices, or even the loss of suppliers altogether.

These consequences create a ripple effect, as a damaged relationship with vendors can hinder the company's ability to secure favorable terms in future transactions and may impact overall operational efficiency. Therefore, effective accounts payable management is critical not only to maintain good vendor relationships but also to ensure healthy cash flow and financial stability for the business.