As a business owner, one of the most important things you can do is keep track of your finances. This includes tracking your income and expenses, so knowing exactly what’s coming in and what’s going out, as well as any outstanding debts. One way to do this is by using statements of accounts.
What is a statement of accounts?
A statement of accounts is a document that summarises your financial activity over a period of time. It typically includes information like your income, expenses, assets and liabilities. They can be used to track your cash flow, identify areas where you could save money and make sure you’re paying your bills on time.
If you’re owed money by a customer, you can use a statement of accounts to track the outstanding debt. This will help keep track of the amount of money owed, the date the payment is due and any late fees that may be incurred.
How to use a statement of accounts
There are a few different ways to chase monies owed using a statement of accounts. One way is to send the customer a copy of the statement of accounts and a reminder that payment is due. You could send the customer a letter or email requesting payment. If the customer still doesn’t pay, you may need to take further action, like sending a letter before action to the customer or taking them to court.
Here are our tips for chasing monies owed using a statement of accounts:
- Be polite and professional at all times.
- Be clear and concise in your communications.
- Set a deadline for payment.
- Follow up if the payment is not received by the deadline.
- Be prepared to take further action if necessary.
Extra tips for using statements of accounts
Here are a few extra top tips to help you in using statements of accounts to chase debts:
- Keep good records. Make sure you keep copies of all correspondence with the customer and any other documentation related to the debt. You’ll need this information if you need to take legal action.
- Be patient. It may take time to collect the debt. Don’t give up if you don’t get paid straight away, and remember it’s better to receive little and often than nothing at all.
Chasing monies owed can be challenging and is rarely any business owner’s favourite part of running a business, but it’s important to take action if you’re not paid. By using statements of accounts and following our tips above, you’ll increase your chances of successfully collecting the debt.
If you’re struggling to collect a debt owed, consider using a debt collection agency. Always seek the advice of a professional accountant if you’re unsure how to go about collecting a debt. Our accountants are here to help with a range of tasks – the good, the bad and the ugly.
