Your Virtual Credit Manager
NOVEMBER 14, 2023
(Photo by Aziz Acharki on Unsplash ) Because Credit Policy is a part of Sales Policy, how you manage credit impacts company profits. How then does your Credit Policy affect your overall profitability? It affects the level of bad debt loss (uncollected Accounts Receivables) you suffer.
Your Virtual Credit Manager
FEBRUARY 20, 2024
Doesn't Account for Bad Debts : DSO doesn't differentiate between collectible and noncollectable receivables. A company may have a low DSO but still face significant losses due to bad debts. In fact, writing off bad debts will lower your DSO. Calculate the total credit sales made during the same period.
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Your Virtual Credit Manager
JANUARY 23, 2024
Learn More About YVCM Consulting Case Study: Portfolio Monitoring Pays Off Big-Time About 25 years ago, a credit manager I know saved his company from a seven-figure bad debt loss by monitoring the Internet on his biggest customers. We are currently offering 33 percent off our standard small business consulting rates.
Know-It Global
JULY 5, 2023
One effective strategy for achieving this goal is to implement a robust credit control system. By effectively managing your business’s credit and collection processes, you can optimise cashflow, minimise bad debt, and enhance overall financial health. Identify areas for improvement and implement appropriate changes.
Gaviti
OCTOBER 24, 2022
Essentially, it’s a tool used in accrual accounting as a way of tracking bad debt up front with the end goal of maintaining more accurate financial statements. ADA is paired with bad debt expenses on your company’s balance sheet, meaning that when you fail to collect on an invoice, ADA is credited and bad debt expense is debited.
Your Virtual Credit Manager
DECEMBER 6, 2022
The company ended up writing off millions of dollars in bad debt. Even worse, the company’s stock price was depressed because of the company’s high Days Sales Outstanding (DSO) , a common measure of AR management effectiveness. The increase in cash on hand was equivalent to four months of sales.
Gaviti
MARCH 4, 2024
Businesses often sell their products or services on credit, expecting to receive payment at a later date. Your average collection period tells you the number of accounts receivable days it takes after a credit sale to receive payment. This is also called your “A/R turnover ratio.” It raises profitability.
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