Accounts Receivable-Accounts Receivable Optimization

Example

Generating and sending invoices to clients after a sale or service is completed.

Scenario

A graphic design firm completes a project for a client and issues an invoice for the work. The AR department ensures the invoice details the services provided, the amount due, and the payment terms, then tracks this invoice until payment is received.

Example

Monitoring incoming payments and reconciling them with the corresponding invoices.

Scenario

A construction company receives a payment from a client. The AR team matches this payment to the outstanding invoice, updating the company's financial records to reflect the payment and adjusting the client's balance.

Example

Assessing the creditworthiness of clients and setting credit limits.

Scenario

Before entering into a sales agreement with a new client, a wholesaler evaluates the client's credit history and financial health to determine a suitable credit limit, thereby managing risk and ensuring healthy cash flow.

Example

Actively pursuing overdue payments while maintaining customer relationships.

Scenario

An IT service provider follows up with clients who have past-due invoices, using reminders and communication to encourage payment while striving to preserve a positive business relationship.