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Accounts Receivable Collection Procedures

Oct 25, 2024 | Blog | 0 comments

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Accounts receivable (AR) collection procedures ensure timely payment of outstanding invoices, supporting cash flow and reducing overdue balances. Key steps include:
  1. Invoice Generation and Delivery: Issue accurate invoices promptly, detailing due dates and payment terms.
  2. Payment Reminder Schedule: Send automated or manual reminders before and after the due date.
  3. Phone Follow-Ups: Contact clients directly to address overdue invoices and discuss payment arrangements if needed.
  4. Negotiation and Resolution: Offer solutions like installment plans or discounts to encourage timely payments.
  5. Escalation: For unresolved balances, escalate to collections agencies or legal action as a last resort.

These steps streamline the AR process, minimize overdue payments, and support effective cash flow management.

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Written by our team of financial experts dedicated to providing insights on optimizing your accounts receivable management.
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