Accounting Tips For You

At our Collection Agency in London, we are supplied with a wide variety of debts. Many have had had previous attempts at collection. We have tried to give you a few ideas on things not to do.

- Employing an agency that “Guarantees” to collect your money. This will usually result in you paying an upfront fee that will never be seen again

- Assuming “Everything will be alright” Be on top of your collections

- Assuming aggression will get your money paid More likely to lead to confrontation and a long wait to be paid

- Immediately reverting to court action Remember this fact: A CCJ is no guarantee of payment

- Ignoring your debtor’s problem Your client may just have a small issue. Don’t be scared to find out what the problem is.

- Horses for courses Often the worst person to make a chasing call is the Boss.

- Fail to Prepare, Prepare to fail Communicate your credit terms at the point of sale. If you don’t, you are leaving it to chance. Not a good idea.

- Don’t let a current debt become a write off. The only difference between a new debt and a write off, is…time (6-10 months on average)

- Organ grinders & monkeys Don’t fool yourself with the easy option. Chase your money with the person that holds the purse strings

- The last is actually a bit of advice…Get the experts in to do the job!

I’ll leave you with a quote - “Whenever a company produces something internally that others can buy or produce more efficiently and effectively, it sacrifices competitive advantage; focus on what gives your company its competitive edge, outsource the rest.” - Harvard Business School

Accounting practices follow certain guidelines and procedures. Such guidelines and procedures are referred to as generally accepted accounting principles (GAAP). GAAP include a combination of legally mandatory standards and commonly accepted ways of calculating financial records. GAAP cover such things as revenue recognition, balance sheet item classification, and outstanding share measurements. The Financial Accounting Standards Board (FASB), the American Institute of Certified Public Accountants (AICPA), and the Securities and Exchange Commission (SEC) provide guidance about acceptable accounting practices.

Although there is some discretion in interpretation of accounting principles, GAAP are based on four general components:

Consistency - All information should be obtained and presented consistently across all periods. If there is a difference in the means of reporting from one period to the next, this must be noted in the financial statements along with a valid reason for the difference.

Reliability - The procedures and results must be able to be replicated by an independent party. This ensures that the business is representing adequate financial records. If procedures and results are not reliable and instead are based on subjective information, they are likely to be disputed.

Disclosure - All relevant information that could influence the understanding and assessment of the financial records of the business should be disclosed in the financial statements. This should include all information that is significant enough to affect assessments and decisions

Comparability - The financial statements and documentations of such in a business must be able to be compared to similar businesses within its industry. This is important so that investors may determin Read more