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The Accounts Receivable Process From Credit Check to Cash

The accounts receivable process covers credit approval, order evidence, invoicing, delivery, cash application, dispute resolution, collection and reporting.

Editorial visual for The Accounts Receivable Process From Credit Check to Cash

The accounts receivable process covers credit approval, order evidence, invoicing, delivery, cash application, dispute resolution, collection and reporting.

Give every stage an owner, required evidence, service level and exception path so an invoice does not disappear between sales and finance.

Accounts receivable process from sale to cash

Stage Output Main control
Customer and credit setup Approved entity, terms, tax and contact data Identity and credit review
Order and delivery Accepted scope, price, reference and evidence Authorization and proof of supply
Billing Accurate invoice sent to the right channel Calculation, tax, reference and duplicate check
Collection Reminder, promise, dispute or escalation record Consistent policy and clear ownership
Cash application Payment matched to invoice and customer No guessed allocation
Reconciliation Ledger and bank differences explained Independent review

AR automation can improve visibility and remove repeat steps, but the workflow needs an exception path for disputes, short payments, unknown receipts, and changed customer details. Optimize the AR process around the evidence customers and finance need, not around the number of automated messages sent.

Assign ownership at the handoffs

Sales confirms terms, billing issues the approved charge, collections follows up and finance applies the payment. A missing handoff can leave completed work unbilled or paid invoices in the reminder queue. Review the queue of unbilled work alongside overdue invoices. Those are different problems, but both delay the movement from delivered work to usable cash.

Example

A project moves from signed proposal to milestone approval, invoice creation, customer delivery, reminder sequence, payment matching and closed status.

What to watch for

Automating reminders cannot repair incorrect customer data, missing purchase orders, disputed scope or invoices sent to the wrong channel.

Put the next step into practice

Read our guide to credits, refunds and debit notes for the related workflow. Explore Invoice Crowd customer invoicing to see the product capabilities relevant to your setup.

Put this into practice in your own account

Proposals, invoices that chase themselves, payments and a double-entry ledger, all under one login. Thirty days on any plan, no card at signup.

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