Business & Community

Exercising Stringent Control Over Your Accounts Receivables

Through exercising control, you can be assured of the close monitoring of your accounts receivables and its subsequent elimination. This will also help reduce the emergence of unnecessary issues related to it, which can hamper its aging. Thus, take note of the pointers below to know how you can control your accounts receivables.

Credit Approval

Although some would say that this is not really required for all business transactions, this will tremendously help in controlling who rightfully gets the credit approval. Note that it would be such a mess if you accidentally grant a potentially delinquent customer with credit approval. This will only lower your chances of collection and put your business in trouble. Even though it is a tedious job, credit approval is necessary to prevent such circumstances. If you are confused, you can ask the assistance of professional collection services in Brisbane to guide you on how to about these things.

Invoice Review

Before you send out your invoices to your respective consumers, it is important you review its details. Make sure that you indicate the right and reasonable payment term as your consumer might end up disagreeing with it and not paying it. There are also instances when the amount is shown is not the right amount; hence, there is a need to revise it before the official count of the outstanding receivables starts. You should be wary as your business operations might be in trouble since you cannot recover your cash at an earlier time since there are invoice-related issues that emerged.

Credit Memo

In fact, there is no problem with credit memos; however, issues may arise depending on who is authorized to create and approve such. In any credit memo, regardless of the amount, it is crucial that it should be approved before it can be released. This type of control prevents the creation of petty credit memos in which, if aggregated, could end up to be a material amount for the business. Remember that it is better to be stringent when it comes to credit memos as this could make or break your business.

Billing Software

Nowadays, computer systems are commonly incorporated in the business to provide ease in working. However, the software should be secured and should remain limited to certain confidential employees to ensure that no one interrupts with it and commit acts of cheating collection. A strong password should be created for each account with access to the billing software.

Checks and Balances

In any business, there is a need to provide a proper check and balance. This will ensure the proper segregation of duties to prevent conflict of interest and to avoid temptation among employees. Do not be afraid to hire more manpower as the job requires it to be. Prevent from assigning these crucial positions to similar persons to avoid the emergence of unwanted issues.

Audit

Although you may be regarded as a small business, this does not exempt you from conducting periodic audits. You might think that this audit is unnecessary and it is just a tedious job to undergo. Yes, at some point, it is true but this is one of the effective ways for you to point out the wrongdoings in your business. This will also provide a chance for your business to improve its internal operations.

It is better to be sure by exercising stringent control over your accounts receivables. Do not be ashamed of doing such as this will help your business processes to improve and your business per se to grow.

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