AR

Accounts Receivable Management refers to the process of effectively managing and collecting payments from customers who have purchased goods or services on credit. It is a critical aspect of managing a business as it directly impacts cash flow and the ability to pay bills, invest in growth and achieve profitability.

The process starts with invoicing customers accurately and on time. This helps to ensure that the customer is aware of the amount due and the payment terms. Proper invoicing practices also make it easier to track payments and follow up on overdue accounts. After invoicing, the next step is to monitor and follow up on payments.

This involves tracking the payment due date and proactively following up with customers who have not yet paid. This can be done manually or through the use of automated systems, such as an accounts receivable management software. It is important to have a clear and consistent credit and collections policy in place.