The Advantages Of An Order To Cash Solution For Accounts Receivable Collections
ACCOUNTS RECEIVABLE COLLECTIONS PROCEDURE
An Order to Cash (OTC) solution can offer countless benefits to finance departments, streamlining processes and providing clear visibility and control over accounts receivables. From the perspective of the Chief Financial Officer (CFO) in particular, these solutions can provide value across many areas of their roles, not least of all in accounts receivable collections procedure. This article will explain how OTC can offer solutions for accounts receivable collection, and will present step-by-step guide to making full use of an OTC solution for this purpose.
Organizations can often find their tax liabilities and accounts receivable collection methods bring challenges that lead to decreased collections performance and delays in cash flow. The complex interplay between taxation, customer payments and quickly changing regulations and compliance can lead to inefficient processing and collections that are slow, inaccurate, and expensive. With an OTC solution, these challenges are tackled head on. Incorporating powerful automation and advanced analytics, OTC is designed to ensure collection teams have immediate access to data-driven insights and features that allow optimization and amplification of the collections process.
todays OTC solutions now eliminate manual accounts receivable processes, including invoice matching, and streamline collection tasks, such as credit checks and compliance requirements. This allows accounts receivable teams to focus on maximizing customer satisfaction, raising collection success and converting customer invoices into cash in timely manner. In providing flexibility, scalability and the ability to take advantage of intelligent solutions, OTC solutions optimize companies’ revenue cycles, reduce costs and offer companies competitive advantage.
Step-by-Step Guide to Utilizing an OTC Solution for Accounts Receivable Collections
1. Create and manage customer profiles that reflect credit and compliance requirements. Customer profiles provide the clearinghouse for critical customer information, allowing easy access and consolidation of data. This includes customer data such as contact information, payment terms, and preferred payment methods. It also includes credit information such as credit limit and customer credit rating.
2. Utilize customer profile data to configure customer policies and automate dunning processes. Control customer policies through the customer profile, automating the dunning process with workflows that alert key stakeholders and update customers with pending invoices.
3. Create customer invoices that are clear and accurate with support for multi-currency, multi-taxation and multiple payment methods. By offering payments in multiple currencies and providing ability to capture taxes correctly and swiftly, this eliminates time-consuming customer payment reconciliation process.
4. Automatically check customer creditworthiness using rules-based engine that identifies customer credit rating with customer profiles and assess customer’s eligibility to buy products and services. This step ensures that customers meet defined credit criteria before fulfilling an order.
5. Automatically match payment documents with customer invoices. The automated payment matching system allows customers to make payments at their convenience. From the companies perspective, this allows for faster approval and financial close.
6. Provide data-driven insights to basis your collections processes on. Leveraging analytics allows accounts receivable teams to identify trends and take timely collection actions.
7. Control customer payments using payment rules engine. Using payment rules engine, accounts receivables can ensure payments are received in the right format, right channel, and right currency.
Conclusion
Order to Cash solutions provide an effective answer for accounts receivable collections procedure, giving Chief Financial Officers the control and visibility they need to efficiently manage complex collections. By automating many of the traditional manual processes and providing data-driven insights into the collections process, OTC solutions provide finance departments with the capabilities to capitalize on any opportunities for streamlining, cost reduction and customer satisfaction.
