Visma.net ERP
Manage credit policy - overview
Businesses do not always pay their suppliers immediately for received goods or services.
To
avoid running out of cash, your company may need to set up proper management of customer
credit.
Credit management tools may include tools for managing customer credits, tracking
customers' outstanding balances, and treating bad debts.
With Visma.net ERP, you can use the following credit management tools:
- Payment terms
You configure payment terms to define documents' due dates.
Payment terms may be used for giving a customer discount for early payment.
For details on configuring and applying payment terms, see: About payment terms. - Credit verification
You can enable a credit check process for each customer that automatically puts overdue invoices on hold and forbids the issuing of new invoices for a customer that has failed a credit check.
For details on configuring and applying credit verification rules, see: About credit verification. - Customer credit hold
You can manually put a customer on hold any time you consider it necessary.
For more information, see: About customer credit hold. - Overdue charges
You can configure additional charges to be applied to outstanding balances of customers who are consistently paying too late or not paying in full.
For details on configuring and applying overdue charges, see: About overdue charges. - Statement cycles
You can configure customer statement cycles to provide customers with information about their balances with your organisation.
For details, see: Statement cycles - overview . - Dunning letters
You can configure a series of dunning letters to remind customers about overdue invoices.
For details on configuring customer notifications, see: Manage dunning letters - overview. - Direct write-off method
You can use the direct write-off method to handle expenses that are required to run the business or that have been incurred in the operation of the business.
For details on configuring and using direct write-offs, see: Write-off methods - overview.We do not recommend that you use the direct write-off method for handling bad debts as it often violates the matching principle of accounting because it recognises bad debt expense that is partly related to a previous accounting period. - Allowance method
You can handle bad debts by using the allowance method.
The allowance method is a better alternative to the direct write-off method because it follows the matching principle of accounting.
For details on configuring and using allowance method, see: Write-off methods - overview.
The following topics will help you to configure and use the credit management tools of your choice.
