Accounts Receivable – Collections

Guidelines/ Procedures

• Billings are generated and sent to customers at least monthly; payment terms
should be indicated on the bill.
• Invoice and supporting documents should be scanned and attached to the
business partner file in SAP.
• Run an accounts receivable report weekly and focus on items over 30 days.
• Issue customer statements after 30 days which shows the status of the customer
account, including outstanding unpaid invoices and recent payments.
• Active efforts must be made to collect on accounts that are past due. Document
conversations and actions taken to collect on delinquent accounts.
• Initiate a series of collection letters and phone calls to the customer to follow-up
on outstanding invoices.
• After 90 days, the county may utilize the Legal Department to attempt collection.
• After 120 days, a receivable may be at risk of being uncollectable. The responsible
department will need to determine if an “allowance for doubtful account” will
need to be recorded to the general ledger in anticipation of a future write-off.
• Adjustments to the receivable balance need to be approved by someone who is
not involved in the billing process and documented. In cases where invoices may
have been incorrectly billed, terms may have been changed or cancelled, the
department director will need to review and approve such changes.
• Receivables that have exhausted all collection efforts and have remained
outstanding for a period of four years, and six years for contractual receivables,
will be summarized in a financial resolution to the Bernalillo County Board of
Commissioners requesting removal from the accounts receivable balance.
• The Accounting & Budget Department will record the removal to the general
ledger that will adjust the balance to accounts receivable.