Controlling Credit
Controlling Credit Checklist 1. Assign responsibility for credit control Ensure that a person of appropriate seniority in the Practice is ultimately responsible for negotiating, granting and supervising credit and for ensuring the prompt collection of monies due. This should be someone who has the ability to supervise the Credit Controller and to take responsibility if the credit position becomes questionable. The exercise of this authority, however, should not be allowed to detract from relationships between individual members of staff and their customers and clients. This is especially important in the case of specialist sales personnel who are still responsible for ensuring that sales are made and goods and services paid for in accordance with the firm's terms and conditions.
2. Introduce a credit policy Introduce a clear cut maximum credit policy - covering both amount and duration of credit. Put this put down in writing so that it cannot be changed arbitrarily and make sure that it is communicated to all colleagues who may be involved in granting credit. Be sure also that customers and clients are aware of your policies. When setting your policies, bear in mind the provisions of any relevant legislation designed to promote timely payment of debts. For example, in the UK, the 'Late Payment of Commercial Debts (Interest) Act 1998', (as amended by the 'Late Payment of Commercial Debts Regulations 2002' and the Late Payment of Commercial Debts Regulations 2013'). Includes limits for private and public sector payments and provisions for businesses to charge interest on debts and reasonable debt recovery costs after specific time periods.
Future Practice Owner.
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