The importance of having an organized and thorough records of accounts in any business enterprise cannot be overstated. There are a lot of important records that should be maintained, but a meticulously-kept accounts receivable ledger is among the top priority of most entrepreneurs. Accounts receivable, loosely defined, is what a customer owes you in exchange for whatever products or services you provided for that customer. If your accounts receivable ledger is disorderly or if the data entries are not reliable, then it would be close to impossible to keep track of who owes and exactly how much they owe. That is a dreadful situation wherein no businessman would want to be placed. To put it in simpler terms, record keeping is essential and is even considered as the backbone of every business.
Aside from monitoring the amounts receivable, keeping track of due dates is highly important. Usually, money owed is due within short time periods which may range from the end of a month or may extend to a year. Your accounts receivable ledger serves as a record for documenting everything that every customer or client owes you and when they should pay for it. One particular task in accounts receivable is keeping tab of all due payments . When payments are made, these must be applied to the proper corresponding accounts. Keeping an accounts receivable ledger is considered an asset, hence keeping a detailed record makes for a good practice that will prove beneficial to your business.
In our age where almost everything is automated, it is now normal practice of businesses to use computers to maintain their records accounts receivable and constantly update them. However, there are still some businesses that still prefer having a manual and traditional accounts receivable ledger and these are still available for purchase in almost all office stores.
Some business owners may find it more costly to maintain, but having one can be considered an investment well made. One reason is that a hard copy of your accounts receivable ledger is sometimes required for tax purposes. Although it is indeed easier and more convenient to keep digital copies of ledgers, there is always the risk of power failure, computer crashes or computer system failures. Therefore, it is always wise to keep hard copies of your account records to serve as back up files. A very good practice is consistently and regularly updating and backing up records on a daily basis.