Accounts receivable is necessary for the survival of any small business. Having a steady cash flow allows you to pay yourself, employees, and vendors, keeping your business viable. Capable accounts receivable management allows you to track the money due to your business and makes your venture successful. Here are a few reasons to track the accounts receivable for your company.

4 Reasons to Track Your Accounts Receivable

1. Get Paid

Accounts receivable refers to money due to your business for goods or services rendered to customers. To pay the bills and keep the lights on, you need this money to be paid sooner rather than later. In addition, with effective accounts receivable management, you’ll have documentation ready to provide your tax accountant when it’s time to prepare your return. 

2. Determine Who Has Paid

You might have sent out invoices to customers for the past month for goods or services that you’ve sold them on credit. Having someone in charge of accounts receivable management allows you to track which invoices have been paid, so you can focus on collecting from delinquent customers.

3. Manage Cash Flow

Healthy cash flow management ensures that you have enough on hand to pay salaries and bills on time and keeps your business’s credit rating positive. Accounts receivable management allows you to track how much money is coming into your business so that you don’t experience any unexpected shortfalls.

4. Need Documentation

You don’t want to end up in court dealing with delinquent accounts receivable, but if you eventually need the services of a collection agency, successful accounts receivable management practices record every invoice and correspondence you have with a client, improving your chances of collection.

Whatever type of business you operate, having a dependable accounts receivable management department is critical to its success. Since 2001, Joseph, Mann & Creed has offered complete collection services for corporations across the nation. Based out of Twinsburg, OH, they are certified with the Commercial Law League of America, and their friendly staff provides quick responses to all customer requests. Call (216) 831-5626 to request a quote, or visit them online to learn more about their services. Follow them on LinkedIn for up-to-date news and information.