Having an efficient system in place for cash flow management is essential for the smooth operations of any business especially in such difficult times of Covid-19 when businesses are slow, and revenues are down. Since payment is the main factor that drives all the business, we require to give due weight to this argument. A common, yet significant barrier that derails the cash flow management in every single organization is the issue of unpaid or overdue invoices. Tackling an unpaid invoice without jeopardizing client relations is a skill, for which the best accounting firms in UAE can provide advice to the businesses.
When the customers failed to pay their invoices or make delays in the payment, the businesses fail to accomplish their target on time. A robust way to avoid such circumstances is to avail of the best accounting services. Here are some handy tips from UAE accountants to tackle the challenge of overdue invoices:
i) Choosing Perfect Accounting Software
In order to follow up with the clients who delay the payments, business owners need well-timed reminders. Accounting software could do this job. Apart from notifying the entrepreneurs, the software can also have the capability to send timely reminders to the clients. If the client forgets and delays the payment, a reminder might assist a lot in getting the payment.
ii) Always Maintain Ageing Report
Preparing and maintaining ageing reports help the businesses to stay updated on overdue invoices. Ageing reports includes all the invoices to be received within the time duration until paid completely. The report helps the business to determine the financial capacity if customers to pay off the overdue payments. In short, the ageing report helps businesses to stay on top of slow-paying clients. Having access to the best accounting services in UAE will help businesses in preparing and maintaining ageing reports.
iii) Have Dedicated Staff to Follow up
The businesses should have a dedicated accounting staff in order to deal with invoices and to keep account of overdue invoices. It will relieve the burden of professionals, will let them focus on their core competencies. It is recommended to have a dedicated department to deal with income that is receivable from the customer. The department staff will be monitoring the sale and invoices to ensure timely payment by customers. Hire efficient accountants in UAE to ease the troubles with overdue invoices.
iv) Devise Robust Follow-Up Strategies
Chasing the clients for payments for unpaid invoices must be a priority, and strategies should develop for successful follow-up with the clients. Such strategies that will enable the business to forecast the income which it will receive in the future. A perfect strategy would to conduct a thorough study about the clients to determine whether they could deliver the payments without delays. The best accountants in UAE may come in handy for businesses in such situations. If the client does't make the payment after you have provided them a service, send them an e-mail. If the client does not respond to email then try to meet them personally and solve the issue.
v) Payment Terms & Conditions Implementation
Before establishing a relationship with the client, the organization should state all the terms and conditions regarding the invoice payments. It is suitable to charge an advance amount from the client and if it is possible then offer some discounts if they agree to pay in advance. Brief the client about the penalties he could have to face if payments will get delay.
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