Receivables too high

  • AP and AR trial balances need to be manually reviewed to determine the net balance for entities that are both a customer and a vendor.
  • Payments are made to vendors who are also customers and who actually owe the company money.
  • You have to enter in transactions to clear the AR or AP balance and then enter additional transactions in the opposite module.
  • Transactions could be entered incorrectly or missed, causing great difficulty in recovery of those transactions.
  • Collection efforts are made for customers who do not really owe you money.
  • You have difficulty managing customers who are national accounts.
  • There are problems with the way you manage them. You manually group customers for credit watch.
  • There is unacceptable credit exposure to customer groups.
  • Payments are sometimes misapplied. You are not able to follow up on collection issues in a timely manner, or you are not able to follow up at all.
  • You are incurring increasing bad debt.
  • Receivables are too high.
  • You are missing deadlines and follow-ups.
  • When a new trial balance is printed, all the notes are transferred to the new report.
  • You have a manual process to generate collections letters and emails for each customer.
  • The activity is redundant.
  • Letters are processed manually for customers with past due accounts, but that takes too much time.
  • Emails are typically generated either one at a time, in batches, or in groupings. Hard copies of letters are kept to track the history, but that costs too much.
  • You are unable to analyze customer data.
  • You have to manually review AR aging to identify customers who have or who are developing credit issues.
  • You are unable to capture all customers that are in need of collection efforts.
  • Tracking account history is difficult.
  • When a new trial balance is printed, not all the notes are transferred to the new report.
  • If a legal situation arises due to the nonpayment of invoices, your company does not have all proper collection documentation.
  • This information is not recorded manually.
  • There is a potential that information could be lost.

About the Author: AJ Amjad Khanmohamed

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