Accounting Systems: Managing Your Accounts Receivable – It’s not only about collections!
Management teams of expansion stage software companies have many things to worry about as it relates to managing their financial infrastructure and accounting systems. One routine problem area is keeping control of accounts receivable. A/R is cash just waiting to be collected and invested against proper business growth strategies. A common mistake that is made is to focus too much on only managing A/R once a problem arises (extensive aging) rather than proactively taking charge of the entire process.
Believe it or not, A/R management begins very early on in the sales process and extends all the way to dispute management.
Below is a high-level outline of the key areas that need to be optimized for proper A/R management:
– Quotation Process
– Pricing Administration
– Contract Process
Organization of A/R
– Receivables Management
– Problem Customers
– National Accounts
– Collection Process
– Collection Calls
– Payment Plans
– Late Payment Fees
Over the next few blog posts, I will go into each of these areas and explain in more detail how to optimize these processes based on learnings I have gathered from many technology CFOs and industry publications.
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