Where is my Money?


June 22, 2021

 

Late payers, Credit Control Process explained:

It’s a fact of life that some clients pay slower than others. They may have a long sign off procedure that means accounts don’t send payments for months, or they may have cash flow issues or maybe that time of year many accounts staff are on leave.

Credit control is the system used to make sure we give credit only to those customers who are able to pay, and that customers pay on time. It is a critical part of a well-managed business that will help reduce bad debts and improve the cash flow in our business.

One of the main reasons Agencies use our services is because we are VERY GOOD at credit control. 

1 – 30 days

We make sure the invoice is payable i.e. there is a PO, contract etc. The contact is correct, the description on the invoice is detailed and the email address is correct.

They get a statement at the beginning and at the end of each month.

2 – 60 days

Some clients have 60 days credit, you will be notified which accounts these are and see them on your Portal. For these accounts they are now only due. For the others this is the stage to get a promise to be paid. We inform the client that the invoices are in excess of the agreed credit terms.

3 – 90 days

At this point we would usually add a note on your Portal so you are aware of the delay and any reasoning behind it.  

In credit terms this is what they call a “reminder of promise.” We obtain a promise of payment and confirm it. We reach out on the phone to make sure all is correct with the payment. We make sure the agents are informed of the delay so they can chase their contact.

4 – 120 days 

In credit terms this is called a “broken promise of payment” . Generally these are rare so we will be aware of the rationale of the delay. We double check we have not had the payment or it has been mis-allocated. The Agency manager is involved and of course the Account is on stop so Artists are informed, so they will be reluctant to work with them again.

Interest can be added to the debt. After this time we have many other tools in our toolbox that we can use from removal of copyright to litigation.

We at Accounts Admin are on your side, not the side of the client. We want that money in, so does your Agent who wants their share.  We work really hard for YOU. 

It’s ironically thankless when some artists see us as the problem not the solution. However, it’s more than made up for by the many thanks we get as well.