Collections Management Checklist

Pull the A/R aging summary and tie the total to the receivables control account on the trial balance. Investigate any variance before working the aging — a sub-ledger that doesn't tie usually means an unposted journal entry, a credit memo applied to the wrong invoice, or a deposit booked to income instead of A/R.

Run the aging by customer in QBO, Xero, or NetSuite as of the prior business day. Export to a working file and flag any account over 60 days, any balance over $5,000, and any customer whose total exposure exceeds their approved credit limit.

Determine the oldest material bucket on the aging — the answer drives the dunning cadence for the rest of the run. "120+" means an escalation conversation, not another email blast. Anything older than 90 days needs a named owner and a deadline before write-off review.

Before chasing a customer, confirm you haven't already received the money. Run the unapplied payments report and the open credit memos report; apply anything that matches an open invoice. Calling a customer about a paid invoice burns trust faster than any late notice.

Use the standard friendly-reminder template with the invoice PDF re-attached and a payment link. Most 30-day balances are A/P-side processing delays, not disputes — keep the tone neutral and confirm the remit-to address.

Email-only chasing stops working past 60 days. Call the named A/P contact, confirm the invoice is in their system, and get a scheduled pay date. If they cite a missing PO or pricing dispute, route to the account owner before the call ends.

Send the final-demand letter via certified mail with return receipt and a PDF copy by email. The letter states the balance, the due date, and the consequence (credit hold, agency placement, or suit) with a hard response deadline of 10 business days.

Date, channel, person spoken to, promise-to-pay date, and any dispute reason go in the customer record. If this account ends up at a collections agency or in small-claims court, the contemporaneous log is the evidence — undocumented calls don't exist.

Route pricing, PO-mismatch, and short-ship disputes to the salesperson or project manager who owns the account, not to collections. Set a 5-business-day target to resolve. Disputes left open past 30 days are the single biggest driver of 90+ aging.

Flag the customer record in the GL/ERP so new orders or shipments require controller approval. Notify sales and operations the same day — discovering a hold after a truck has shipped is how A/R loses internal credibility.

Once the dispute is settled, void the original invoice or apply a credit memo with a clear memo line referencing the dispute case number. Re-send the corrected invoice with a fresh net-30 due date so the customer's A/P system has a clean record to pay against.

Controller reviews each balance over 120 days with the account owner. The choices are agency placement (typical contingency 25-40%), small-claims or civil suit (under the state's jurisdictional limit), settlement at a discount, or write-off. Document the rationale on the customer file.

Submit the placement packet — signed contract or terms, invoice copies, statement of account, full communication log, and any signed POs. Stop direct contact with the customer the moment placement is confirmed; parallel collection efforts violate most agency contracts and confuse the debtor.

If using the allowance method, debit Allowance for Doubtful Accounts and credit A/R. If direct write-off (smaller cash-basis shops), debit Bad Debt Expense and credit A/R. Attach the controller-approved write-off memo as the workpaper. Do not write off anything that hasn't gone through the escalation review above.

Match each deposit to specific invoices using the customer's remittance advice. Avoid the lazy pattern of applying to the oldest invoice automatically — that masks disputes and inflates DSO. Short payments need a written reason on the receipt before posting.

Refresh the dashboard with rolling 3-month DSO, CEI (collection effectiveness index), percentage current, and write-off rate. Variances of more than 5 days in DSO month-over-month deserve commentary in the package to the CFO.

The package: aging summary, top-10 overdue with owner and next action, disputes opened/resolved this week, accounts on credit hold, and KPI movement. Keep it to one page — the goal is decisions, not a data dump.