What Is an Accounts Receivable Policy Manual

The accounts receivable policy manual documents financial principles and policies for your accounting department.

last updated Monday, July 8, 2024
#Principles and Policies #Policy Manual

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John Burson

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The accounts receivable policy manual and other related procedures help you satisfy the documentation required for your accounting management system.

The accounting principles and policies offer the following:

• Foundation for the systems you will use for internal accounting controls
• A guideline for your financial activities
• A decision-making criterion
• Direction and guidance for accounting problems and reports so they are uniform

Consistent application of the principles and policies ensures that your financial statements reflect the results of various operations.

Accounting Controls

Internal controls help you create checks and balances that make identifying irregularities easy, preventing wastage, abuse, and fraud in accounting. They also help resolve disputes that may be accidentally introduced into daily operations. Department heads can help identify additional documents needed for effective planning and control of accounting processes.

Other company policies and procedures should conform to the accounting policy manual. If you need to make changes, ensure they do not conflict with the accounting manual's requirements.

Accounting Management Responsibility

The CFO is in charge of maintaining and controlling the accounting policy manual. In smaller companies, the CEO or the president becomes the accounting controller.

Accounting Management Commitment

The company's management demonstrates its commitment to the accounting management system by developing and implementing a company accounting policy manual. The company’s accounting policy further demonstrates this: You set specific objectives and review them in management meetings while providing the resources required to meet them and ensure the effective management of operations and accounting systems.

The management team, headed by the president, ensures the accounting system meets customers’ needs and other regulatory requirements.

Accounting Policies

The policies you create in your accounting policy manual refer to all activities and operations in the business. Department managers must take it upon themselves to maintain and implement the policies stated in the accounting manual to ensure all processes work within the set requirements. All employees must also abide by the procedures to ensure the implementation of accounting policies and that the company strives towards improving all its processes and operations. The objective is to provide a manual that is useful and clear.

 
 
 

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