We all need and want things and so we all shop (some of us more than others). Unfortunately this means we are all also familiar with accounts receivable and collection of those accounts. Though you may not know it buy this name, which makes it sound much more ominous than it really is.
When you buy something whether it is a service or goods, you will then be involved in the accounts receivable which is basically the repayment for said services or goods. Usually for businesses this is done by mailing or electronically delivering (the new earth healthy green way of doing business) an invoice. The invoice will have the amount the customer owes and the timeframe they have to pay it in. This is usually referred to as the accounts receivable collection period.
Sometimes this is taken care of through the business directly, and sometimes it is taken care of for the business by an accounts receivable collection agency. If you are late the accounts receivable collection policy and procedures will dictate the next step. This usually involves incurring additional fines and if you have not already been given over to a collection agency, after a certain amount of time you will be given to them to deal with.
This is why it is better to have your accounts in order on time. Most businesses tend to give you a reasonable collection period in which to settle up. If you are having personal problems and have been a reliable customer of the company in the past, some companies will let you pay the debt back slowly, increase the accounts receivable collection period, or in some extreme cases postpone said collection until a later date.
Best of all, when you are upfront with the company you owe money too you can often avoid dealing with the accounts receivable collection agency penalty policies. Besides the fact that they can be unpleasant because they are paid to enforce payments of money owed, they can also be very bad for your credit.
Often when it comes to agencies who collect past due bills, it will show up on your permanent credit score. Actually your credit is renewed about once a decade, however with that marked on there it can seriously damage your credit. This makes it harder to get loans, buy a car, buy a house, or make any other large financial decisions where you might need to borrow money.
These are all extreme cases however. Some businesses even use simple accounts receivable collections software at times to keep track of bills and send them out. Accounts receivable is something most of us deal with on a very regular basis and as long as you are aware of the terms and procedures of how a company expects to collect the money due, you should not encounter any problems. So go, shop, and be merry. Just remember there will be a bill at some point.