- July 19, 2018
- Member: FREE
More than half of organizations consider customers’ adherence to payment terms to be a key indicator of the credit function’s performance. But all too often, organizations take an unrealistically optimistic outlook on past-due receivables — even when deep down, they know that the likelihood of collecting payment on some invoices is very low.
This article focuses on a crucial metric—total uncollectible balances as a percentage of revenue—as reported to APQC’s Customer Credit and Invoicing Open Standards Benchmarking survey.
The processes associated with this metric include managing and processing collections, including establishing policies for delinquent accounts, analyzing delinquent account balances, corresponding and negotiating with delinquent accounts, discussing account resolution with internal parties, and processing adjustments or writing off balances.