Apr/May 2008 – The Value of Your Aging Accounts Receivable

The Value of Your Aging Accounts Receivable

From point of sale, through to our client's internal mechanisms that prompt the outsourcing of a customer account, timeliness and punctual decision making proves critical to collection success as illustrated in the following graph:

Source: Commercial Law League of America

It has been our experience that those organizations who follow a "rules based" policy (void of emotion) when it comes to managing their accounts receivable find themselves dramatically reducing the total value of their bad debt write-offs on an annual basis.

Delinquent accounts permitted to age, due to the absence of any "rules based" policy, also ends up burdening management and staff due to the need for their ongoing follow up with the customer. Management and staff could be putting their time to more productive use.

From Douglas Bader British World War II pilot:
"Rules are for the obedience of fools and the guidance of wise men."

…Some food for thought. Rules pay.

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