Debtors’ Management a Problem Area for Many Businesses
Business Advisory Services Updates
Debtors’ management is often not given a high priority in a business and this can lead to high levels of debt owed to the business.
Accountants can assist their clients to improve their debtor’s management systems by encouraging a monthly calculation of “Debtors’ Days Outstanding”.
Debtors efficiency will be enhanced by the utilisation of a written debtors’ management system which will assist the team member, assigned to this task, to perform his/her duties.
Debtors’ management commences with:
- The initial agreement with the customer relative to terms of trade and retention of title agreements.
- Decision – register this customer on the Personal Property Securities Register or not.
- Implementation of any requests that the customer has made in relation to the information to be shown on the invoice and the monthly cut of dates for tax invoices to be received by the customer.
- Due date for payment shown on the invoice.
- Emailing of debtors’ statements within 48 hours of the end of a month.
