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Accounts Receivable Management and Financing Services in Singapore

Every businessman knows that collecting payments on account in a timely manner is important to financial efficiency for a business. As such, the main purpose of accounts receivable is to track revenue earned but not collected. Company use it as to manage and collect money owed by buyers who make purchases on account and agree to pay later. In other words, one of the biggest factors that can affect how much cash flow a business has is how well they manage their accounts receivable.

 

What is Accounts Receivable Management?

An “account receivable” is created when a client makes a purchase but does not make payment immediately. Therefore, a good accounts receivable management will prevent overdue payment or non-payment and ensure cash flow of a company. Simply put, it is an effective way to strengthen a company’s financial [or liquidity] position.

 

Why is Accounts Receivable Management Important to a Business?

Receivables management is more than payment reminders to customers where it is also about identifying the reason for non-payment or overdue payment. In some cases, poor receivables management lead to bankruptcies. As such, a good receivables management is important to a business and it is a comprehensive process consisting of:

  • Determines customer’s credit rating in advance
  • Maintains customer relations
  • Detects late payments in due time
  • Detects complaints in due time
  • Reduces total balance outstanding
  • Prevent bad debt in receivables outstanding

 

How to setup Accounts Receivable Management?

Preparing good receivables management involves two steps. Firstly, you identify your strategy and then you specify the appropriate procedures.

  1. Identify the Strategy
    • Which customers do you accept (under which conditions)?
    • Which customers do you monitor?
  2. Prepare appropriate procedures
    • What is the invoicing process?
    • How and when do you remind a customer?
    • When do you engage a debt collection agency (if necessary)?
    • When will you start legal proceedings?
    • If legal proceeding is in place, what is the role of your employees and will you choose outsourcing or in-house management?

 

What do we offer?

At 3E Accounting, we offer our accounts receivable management and financial services with the support of our affiliates. The services include:

  1. Invoice factoring: Provide immediate working capital to help cover a funding gap caused by slow-payment and improve cash flow.
  2. Customer Assessment: An analysis of client creditworthiness including Payment history, financial statements, and general economic conditions are carried out before engaging in a sales credit agreement.
  3. Credit underwriting & Credit Insurance: Credit insurance safeguards your company against the failure of your customers to pay their trade credit debts owed to you.
  4. Collection agent: Personnel that acts as the liaison between creditors and customers and manages overdue payments (he or she is responsible for reaching out to customers to collect payment for overdue payments).

 
Running a business without proper accounts receivable management will put your business at high risk. Contact us today to learn your risk and get a perfect solution for your business!