Cash Flow

Cash Flow is the flow of cash or cash-equivalent into and out of the organization, as a measure of a business' liquidity and overall performance, within a certain period of time.

Commercial Collections vs Consumer Collections

Commercial collections are attempts to recover unpaid business invoices owed to another business. Consumer collections are when a consumer owes a debt to a business.

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Bad Debt

Bad Debt is the term used to describe any accounts receivable balances that are unlikely to be paid.

Accounts Receivable Management

Accounts Receivable Management includes the practice of collecting money that is owed after extending credit for a product or service. 

Payment Terms

Payment Terms are the conditions by which an invoice or contract will be paid. These terms are typically specified in a contract or arrangement and agreed upon by both parties.

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Statement of Account

A Statement of Account is an accounts receivable report sent to a client detailing open invoices to and payments from the client during a specific time period, resulting in an ending balance (net of all transactions listed).

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First Party & Third Party Collections

"First party collections" refers to a company using its own employees, usually within the accounts receivable department, to collect on unpaid invoices. "Third party collections" are collections efforts made by a collections agency, outside of the original crediting company.

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Collections Representative

Collections representatives perform the duties required to collect on overdue invoices and accounts.

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DSO

Days Sales Outstanding (DSO) is an accounts receivable term that measures the average amount of time to collect funds from credit sales. 

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Factoring

Factoring is selling your company's accounts receivable invoices at a discount to a third party for immediate cash.

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