Accounts Receivable SOP 

An accounts receivable standard operating procedure (SOP) is a set of documented guidelines for managing and collecting outstanding customer balances. This SOP provides a clear outline of the process to follow when managing accounts receivable, ensuring that all steps are followed consistently and effectively.

Here is a sample accounts receivable SOP:
 

​Invoice Generation:

• Invoices should be generated as soon as goods or services are provided to the customer.

• Ensure that the invoice contains the correct information, including the customer name, billing address, invoice date, and payment terms.

• Send the invoice to the customer promptly, either electronically or by mail.
   

Payment Monitoring:

• Monitor payments received against invoices issued.

• Record all payments received in a timely and accurate manner.

• Follow up on any overdue payments and ensure that appropriate action is taken.
   

Collections:

• Establish a process for managing overdue accounts and follow it consistently.

• Send reminders to customers for overdue payments.

• If a customer is consistently late with payments, consider implementing stricter payment terms, such as requiring payment in advance or shorter payment terms.
   

Dispute Resolution:

• Provide a process for handling customer disputes or payment discrepancies.

• Investigate and resolve any disputes or discrepancies in a timely and professional manner.
   

Reporting:

• Regularly review accounts receivable reports to ensure that all outstanding balances are being tracked and managed effectively.

• Monitor the aging of outstanding balances and take appropriate action to collect overdue balances.
   

Record-Keeping:

• Maintain accurate records of all customer transactions, including invoices, payments, and correspondence.

• Ensure that records are kept up-to-date and are easily accessible to authorized personnel.
   

By following these guidelines, you can establish an effective accounts receivable process that will help ensure that your business receives payment for the goods or services it provides, and maintain strong relationships with customers.