ai智能写作Accounts Receivable
Author: M. Elizabeth Haywood, Donald.
Introduction
Accounts receivable consists of monies due from customers as a result of an organization's normal business operations. The management of accounts receivable is an extremely important function since the collection of outstanding receivables reprents the single most important source of cash for all organizations lling goods on open account. Becau of the impact that accounts-receivable collections have on cash flow, it is important that responsibility for the day-to-day management of credit and collections activities be delegated to a single individual within the organization. 写李白的诗
Accounts Receivable as a Current Ast
On the balance sheet, accounts receivable is reported as a current ast and is considered part of an organization's working capital. As a current ast, accounts receivable is expecte
d to be turned into cash within the annual operating cycle of a business, which for most business is generally considered to be one year and corresponds to the twelve-month fiscal year ud for financial reporting purpos. This, however, does not imply that it should take one year to collect individual receivable balances. 工作不足
In the ca of a university press, accounts receivable reprents a major component of current asts, working capital, and cash flow. The other major components of a university press's working capital are cash, short-term investments, and inventory. As a component of working capital, accounts receivable must be carefully managed in order to be turned into cash as quickly as possible and to avoid becoming uncollectible. Although accounts receivable is reported as a current ast, it must be carefully valuated and reported becau until the receivable is collected, it cannot readily assist with the paying of current obligations.
Accounts Receivable and Collections Reports
Becau of the significance of accounts receivable it is important for management to rece
ive periodic reports that both measure the effectiveness of collection activities and inform or alert management of problem accounts. Ideally, reports should be generated on a monthly basis, but depending on the size of the receivable balance and collections staff, the issuance of such reports may range from weekly to quarterly. This flow of information is necessary so that management and collections staff can determine whether current credit and collections policies and procedures are working, or whether any of the policies and procedures need to be changed to more effectively collect outstanding receivables. Additionally, the collections staff needs information so that collection activities can be prioritized, problem accounts isolated, and outstanding balances collected.
Analysis of Accounts Receivable and Collections
维保方案A number of methods are ud to measure accounts-receivable balances and the effectiveness of collection policies and procedures. Some of the more frequently ud methods to analyze accounts receivable and collections include
A/R at Year End as a Percentage of Total Sales. This ratio is computed by dividing the fis
天丧予cal year-end A/R balance by fiscal year net sales. The AAUP Statistical Survey reported averages between 21.6 percent and 23.0 percent for fiscal years 1992 through 1995. This ratio can also be computed at any time during the year; however, to get a meaningful ratio, the A/R balance must be divided by net sales for the most recent twelve months.
Average Collection Period. This ratio is an indication of the average number of days required to convert receivables into cash. Ideally, the computation should u a monthly average of receivables and include only credit sales. A monthly average of receivables should be ud in order to offt any fluctuations that may occur during the year. Additionally, only credit sales should be ud in this computation since cash sales usually do not involve any credit risk. The computation of the average collection period is a two-step process. First divide total sales (preferably credit sales only) for the fiscal year by 365. This calculation yields the amount of credit sales per day. Then divide the year-end receivable balance (or average monthly receivable balance) by the credit sales per day. The result is the average collection period in days. The AAUP Statistical Survey reported
average collection periods of 77 to 91 days for fiscal year 1995 and 80 to 95 days for fiscal year 1994.
A/R Aging Schedule. This is a periodic report ud to determine the priorities of collection activities. An aging schedule lists all customer accounts with outstanding balances as of the date of the aging schedule, one account per line. Across the line, the total amount due is broken down, or aged, by overdue categories. The overdue categories generally include current (not yet due), 1 to 30 days past due, 30 to 60 days past due, 60 to 90 days past due, and over 90 days past due. The aging categories may need to be adjusted to properly reflect an organization's terms of sales. 文化的传承
A/R Aging by Customer Type or Payment Terms. This is a variation of the A/R Aging Schedule and can be ud to more effectively target accounts that require the attention of the collections staff. A more focud schedule also allows comparisons to be drawn between similar accounts.
Bad Debt Expen as Percentage of Total Sales. This ratio is computed by dividing year-
end bad debt expen by net sales. The AAUP Statistical Survey reported averages of 0.4 percent and 0.5 percent for fiscal years 1992 through 1995.
Bad Debt Expen as Percentage of A/R Balance. This ratio is computed by dividing year- end bad debt expen by the year-end (or average) A/R balance. The AAUP Statistical Survey reported averages between 1.8 percent and 2.0 percent for the fiscal years 1992 through 1995.
英语b级高频词汇Credit Department Monthly Report. This is a summary report that helps management monitor the monthly accounts-receivable status and collections activities. A typical report would include current month and prior month balances for accounts receivable, total collections, and total net sales. Additionally, some ratios might be included, such as the average collections period. Bad debt comparison would include bad debt write-off for the current month, fiscal year to date, and last fiscal year to date. Finally, a summary of the number of accounts and balances in each aging category should be included. There is no universal, or standard, format for this type of report. For a credit department monthly repo
庆祝国庆rt to be truly effective, it must be tailored to the needs and reporting capabilities of each individual press. The idea of this report is to provide management with a one-page summary of collection results each month.
