Control of Receivables

Control  of   Receivables

1)      Days Sales Outstanding (DSO)

DSO= Debtors + Bills Receivable     days

Average  Daily  Sales:

2)      Ageing Schedule

Debtors are  classified  into different  age brackets.

3)      ABC Analysis

Classification  of  Debtors  into A  Category,  B  Category and C  Category

A  Category—Small  no. of   debtors  but  of  large  values—Highest Control

B  Category— Moderate  no. of   debtors and  of  moderate  values—

–  Moderate Control

C  Category— Large   no. of   debtors but   of  small values

– Less  Control