Everything a CFO should know about Accounts Receivables Automation
January 23, 2023Create Champions Out of Accounts Receivable Specialist
February 28, 2023Accounts receivable (AR) is a critical component of any business, as it involves managing and collecting payments from customers for goods or services that have been provided. The impact of Accounts Receivables can be felt across several functions within a business, including sales, finance, and customer service.
Sales: The sales function is closely tied to the accounts receivable process, as it involves issuing invoices to customers and tracking payments. If the accounts receivable process is not managed effectively, it can negatively impact the sales function by delaying payments and causing cash flow issues. Furthermore, if the invoicing process is not accurate and timely, it can cause confusion and frustration for customers, negatively impacting the sales process.
Finance: The finance function is directly affected by the accounts receivable process, as it involves managing the company’s cash flow. If the accounts receivable process is not managed effectively, it can lead to delays in receiving payments, which can negatively impact cash flow and cause financial instability. The finance function is also responsible for generating financial reports such as the aging report, which shows the status of all outstanding invoices, and credit control, which involves setting up credit limit for customers and monitoring their payment history to minimize the risk of bad debt.
Customer Service: The customer service function is also closely tied to the accounts receivable process, as it involves following up with customers who are late with their payments and addressing any issues or concerns they may have. If the accounts receivable process is not managed effectively, it can lead to delays in receiving payments, which can cause frustration and dissatisfaction for customers. Furthermore, if customers are not contacted in a timely and professional manner, it can negatively impact the overall customer experience.
Operations: The operations function can also be affected by the accounts receivable process, as it involves managing the company’s inventory and production. If the accounts receivable process is not managed effectively, it can lead to delays in receiving payments, which can negatively impact the company’s ability to purchase raw materials, pay for labor, and generate revenue.
In conclusion, the accounts receivable process is a critical component of any business, as it involves managing and collecting payments from customers. The impact of Accounts Receivables function can be felt through several functions within a business, including sales, finance, customer service, and operations. If the accounts receivable process is not managed effectively, it can lead to delays in receiving payments, negatively impacting cash flow and causing financial instability. Furthermore, it can cause frustration and dissatisfaction for customers, negatively impacting the sales and customer service functions. Therefore, it is important for CFOs to ensure that the accounts receivable process are managed effectively and efficiently to minimize the risk of these negative impacts.
Kapittx is a Software-as-a-Service (SaaS) platform to automate the critical process of Accounts Receivables or Debtors. It enables various stakeholders like Sales, Accounts, Logistics, and Customers to collaborate effectively and get paid faster. Founded in 2019, by veterans in the Payments, Finance, and Technology domains, Kapittx is built to integrate with your existing processes seamlessly. The easy-to-use interface, enables businesses in diverse fields like manufacturing, services, technology, transportation etc customize it to their own unique requirements. Kapittx recognizes that each industry and each company handles receivables in a different way and aims to eliminate the barriers to getting paid faster.
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