If you are a small business owner using Quick Books to manage the bookkeeping and accounting aspects of your business, you may also want to consider utilizing some of the other management tools available within Quick Books, including those that can help you to manage and improve the cash flow in your business. If you extend credit to customers, one of the key reports available in Quick Books Pro is the "Accounts Receivable Aging Summary" report. This report summarizes the status of unpaid invoices. For each customer who owes money, the report shows what the customer owes for both current and previous billing periods. It's a good idea to review this report on a monthly basis and pay particular attention to those customers who have overdue balances.
For those customers you are having difficulty collecting payment from, there is an option available in Quick Books Company, linked with Microsoft Word, to prepare letters using specific templates. For example, there are pre-written collection letters, both friendly reminders and somewhat harsher versions that you can use & modify to send to customers that have overdue balances. You can even limit the letter recipients to customers who are overdue by a certain number of days, as well as select specific customers. Quick Books also has letter templates for credit application letters and for addressing NSF cheques.
Other tools available in Quick Books Pro, that can be useful to improve cash flow management in your business include the ability to: customize invoices; set-up reminders for invoices to print and overdue invoices; create statements to send to your customers that summarize all invoice transactions for a particular period of time; and set-up finance charges or service charges for overdue payments. Reducing the average collection period by even a few days can have a dramatic impact on both your company's cash flow and the bottom-line. So, if you are using a small business program such as Quick Books, try utilizing some of the built-in management resources available, such as those designed to help you manage the cash flow in your business more effectively.
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