Hi Gurus,
I just got a offer for developing company's credit and collection process, but I only have limited knowledge about this area, and also not familiar with Accounts receivable, could any of you share some experiences? or suggest any book that may help???
Thanks for your great help in advance.
From China, Guangzhou
I just got a offer for developing company's credit and collection process, but I only have limited knowledge about this area, and also not familiar with Accounts receivable, could any of you share some experiences? or suggest any book that may help???
Thanks for your great help in advance.
From China, Guangzhou
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Hi,
Please find attached the ebook.
Just a brief:
- The Credit & Collections process starts with the creation of an account.
- Once the account is created by the Data Maintenance Team, the Credit analyst works out the credit limit of the customer and determines if the customer is worthy enough to do business with. This is done by analyzing the company reports from different credit rating agencies like D&B, Financials, Trade References, etc.
- Once the credit limit is established, the orders are entered into the system by the order entry team, which is approved by the credit controller.
- Then, the billing team invoices the customer.
- Once the invoice becomes due, the Credit & Collections team starts following up with the customer to receive payment against the overdue invoices.
- Once payments are received, they are applied against the invoices as per the remittance advice received from the customer.
- If there is any short payment received (Customer pays less than what they have been invoiced), also known as deductions, the Credit & Collections team follows up with the customer's Accounts Payable and their own sales team to resolve the issues.
- At the end of every month, reconciliation is done to ensure that the ledgers match.
Hope the ebook and the above process flow would be helpful to you. :)
Wishing you a happy new year!!!
From India, Delhi
2Please find attached the ebook.
Just a brief:
- The Credit & Collections process starts with the creation of an account.
- Once the account is created by the Data Maintenance Team, the Credit analyst works out the credit limit of the customer and determines if the customer is worthy enough to do business with. This is done by analyzing the company reports from different credit rating agencies like D&B, Financials, Trade References, etc.
- Once the credit limit is established, the orders are entered into the system by the order entry team, which is approved by the credit controller.
- Then, the billing team invoices the customer.
- Once the invoice becomes due, the Credit & Collections team starts following up with the customer to receive payment against the overdue invoices.
- Once payments are received, they are applied against the invoices as per the remittance advice received from the customer.
- If there is any short payment received (Customer pays less than what they have been invoiced), also known as deductions, the Credit & Collections team follows up with the customer's Accounts Payable and their own sales team to resolve the issues.
- At the end of every month, reconciliation is done to ensure that the ledgers match.
Hope the ebook and the above process flow would be helpful to you. :)
Wishing you a happy new year!!!
From India, Delhi
Hi, the above information is very useful. You can add some tips like the Dunning Procedure, which nowadays many MNCs and branded companies, as well as banking organizations, are following to collect credit in a polite manner. Credit collection depends on how well you keep track of their accounts. They have certain credit limits, and it is essential to ensure that the AR team follows those rules. Additionally, you need to prepare an aging report monthly and have an understanding of bad debt, which includes credits that fall under such debts.
Apart from this, check your SLAs (Service Level Agreements) and the agreements companies have made with them, etc. I hope this information is useful for you. If you want more, you are welcome to join our professional groups on pahechan.in. Have a good day.
From India, Bangalore
Apart from this, check your SLAs (Service Level Agreements) and the agreements companies have made with them, etc. I hope this information is useful for you. If you want more, you are welcome to join our professional groups on pahechan.in. Have a good day.
From India, Bangalore
Hello colleagues,
Please, has anyone done research on improving accounts receivable to enhance profitability in a company? I am an MBA student and do not have basics in accounting, so I really need professional advice from you gifted people.
As fast as possible, my deadline is Tuesday, 12th April.
Kind regards,
lilybaby
From Nigeria, Lagos
Please, has anyone done research on improving accounts receivable to enhance profitability in a company? I am an MBA student and do not have basics in accounting, so I really need professional advice from you gifted people.
As fast as possible, my deadline is Tuesday, 12th April.
Kind regards,
lilybaby
From Nigeria, Lagos
I have read the book, thanks. But I have a problem with getting research questions, an objective, and forming a questionnaire for improving account receivable to enhance productivity in a pharmaceutical company. Can anyone please assist me? I am not an accountant by profession.
Lilybaby
From Nigeria, Lagos
Lilybaby
From Nigeria, Lagos
Hi, I have experience in Accounts Receivable in a BPO. We provide finance support to GM Motors in the Philippines. I don't know how useful it is, but based on my experience, having control over AR Inventory, checking all Credit Limits allowed to your company's customers, preparing reports like Customer Aging where you will find Credit limits and Collection pending. Additionally, understanding the Dunning Procedure will be helpful for you. These are very important AR activities. If you have control over them, you will succeed in achieving your goals. Thank you.
From India, Bangalore
From India, Bangalore
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