CUSTOMER CREDIT LIMITS
ARE SET BY RECEIVABLES
LEDGER CLERKS.
CLERKS ARE NOT SENIOR
ENOUGH SO THEY MAY SET
LIMITS TOO HIGH LEADING
TO IRRECOVERABLE DEBTS
OR TOO LOW LEADING TO
LOSS OF SALES.
CREDIT CONTROLLER IS ON
SECONDMENT AND HAS NOT
BEEN REPLACED.
NO ONE IS MONITORING THE
AGEING OF RECEIVABLES, SO
THIS INCREASES THE RISK OF
IRRECOVERABLE DEBTS
LEADING TO LOSS OF
PROFITABILITY AND
REDUCED CASH FLOWS.
sales order department does
not receive a copy of the
completed GDNs AND AS A
RESULT they are not able to
monitor if orders are
being fulfilled on a timely
basis.
This could result in a loss of
revenue and
customer goodwill
CREDIT LIMITS SHOULD BE
ESTABLISHED BY A SENIOR
MEMBER OF THE RECEIVABLE
LEDGER DEPARTMENT AND
THESE LIMITS SHOULD BE
REGULARLY REVIEWD BY A
RESPONSIBLE OFFICIAL.
An alternative member
of the finance department
should also be trained in the
credit control role and
assigned responsibility for
reviewing the aged
receivables listing and
following up debtors.
( on any overdue
customers )
THE GDN SHOULD BE
AMMENDED TO BE AT LEAST
4 PARTS WITH 1 COPY BEING
RECEIVED BY THE SALES
ORDER DEPARTMENT AND
MATCHED TO THE ORDER.
A regular review of
unmatched orders
should be undertaken by the
sales order department to
identify any unfulfilled
orders.