If a company’s existence is measured by revenue, then its life blood must be how well it manages accounts receivable. Many business executives say that a sale isn’t a sale until the money has been collected.

This course examines best practices in accounts receivable management. Accounts receivable management is associated with both credit and collections. These important functional areas work with sales as well as treasury and bank vendors to ensure the maximum realization of cash from sales revenue.

While a good credit function holds the key to “safe sales”, those sales for which you will be paid, the best accounts receivable management will also find a way to take riskier sales and minimize that risk wherever possible through credit insurance or other arrangements. Best practices dictate that sales and accounts receivable work hand-in-hand to maximize good sales opportunities, ensure that order processing and invoicing is controlled and timely and that pricing is up-to-date and accurate.

A properly managed accounts receivable function also has a significant impact on the organization’s overall cash flow. Best practices dictate that accounts receivable management ensures that there are diverse customer payment methods available, payments are processed timely and accurately and the process is controlled to ensure that all amounts due are timely paid.

This course explores each functional area, starting with the sales function, and the best practices that relate to accounts receivable management. Credit and collections will each be discussed followed by accounts receivable management administrative best practices, which will include portfolio review, internal controls and payment application. Banking best practices as they relate to accounts receivable management will be explored last.

Learning Objectives
  • Discover the importance of the billing, pricing and credit memo process to accounts receivable best practices.
  • Explore customer credit evaluation techniques.
  • Discover and define and use the Altman Z score and other ratios in evaluating customers.
  • Recognize non-traditional methods to secure customer payment.
  • Recognize best practices of the collection function.
  • Identify and associate the importance of internal controls with the payment application function.
Last updated/reviewed: August 24, 2023
15 Reviews (69 ratings)

Reviews

5
Anonymous Author
This is a great course for accounts receivable folks as the course covers a great amount of information concerning best practices and collections. I've learned a lot and would recommend to others looking to obtain some useful information on the subject matter!

4
Member's Profile
I liked the detail on the topics. I think that a better overview or tbale of contents at the beginning would be helpful. Also think it would be good to bold words that are in the glossary.

3
Anonymous Author
I prefer questions that are said in the positive vs negative. There were a number of test questions that asked to identify what was "NOT" the right choice.

5
Anonymous Author
Challenging course on AR Best Practices, this is an advanced AR course which will require some time to get right.

4
Member's Profile
Good course giving a brief overview of the the accounts receivable function for small to mid size business.

5
Member's Profile
Great course, with lots of valuable information for me to incorporate into my company's internal controls.

5
Member's Profile
It was fairly straightforward material, case studies were helpful but since it was only PDF it got boring.

4
Anonymous Author
I prefer the video lectures but this PDF was pretty good and I was able to quickly pass the exam with it.

4
Anonymous Author
Good class and great overview of the AR and Collections process. I liked the case studies and examples.

4
Member's Profile
I prefer video courses.. This course was pretty basic, but still contained a lot of valuable info :)

5
Anonymous Author
Very informative course. I appreciated the breakdown of the various topics. Great refresher!

5
Anonymous Author
nice outline on current debt coverage ratio and cash interest coverage ratio

4
Anonymous Author
Very useful information, practical applications for everyday use

5
Anonymous Author
useful information that we can actually apply in the business

5
Anonymous Author
Great Course. REally covered the essentials of A/R.

Prerequisites
Course Complexity: Intermediate
No advanced preparation or prerequisites are required for this course.
Education Provider Information
Company: Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact: For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Instructor for this course
Course Syllabus
Course Materials
  Accounts Receivable Best Practices for Small to Medium Sized Commercial EntitiesPDF
REVIEW QUESTIONS
  REVIEW QUESTIONS quiz
 FINAL EXAMexam