Importance of accounts receivable and accounts payable in a company

Dear readers, continuing with the sequence of articles concerning the accounting and administrative processes of companies, this time I will talk a little about accounts receivable and accounts payable, accounts payable is nothing more than those products or services that are acquired from another company and the same must be canceled. It should be noted that there are companies that work on credit of certain days and others must be canceled at the same time (decontado).

In this sense, Aranda (2010) defines accounts receivable as those amounts that customers owe to any company for having obtained goods and services from it or for obtaining credit in the course of business.

In other words, accounts receivable are originated when the business unit assigns credits to certain customers, either for the sale of a product or the rendering of a service, and they must assume the commitment to cancel the invoice within the days considered for its cancellation.

On the other hand, with regard to accounts payable, companies, whether large or small, must keep a record or list of all invoices to be paid to other suppliers, taking into account the credit days assigned to each one of them. Likewise, if a relationship is carried out, it will avoid the presence of interest on the maturity of each of the invoices.

It is essential to keep this type of accounts in a detailed way because if the business unit does not pay attention to the merchandise that goes out and the money does not return, its liquidity could be affected. It is for this reason that it is recommended to have a person to follow up on these accounts in order to have a good internal control according to their accounts.

Finally, this topic is very interesting for those who provide a service or are starting a business, because no matter how small it is, it needs a good administration because at the time it may be small, but in a few years it could be bigger according to how its resources are managed. The accounts receivable and accounts payable are important because they are the ones that determine the inventory turnover of the company and also through the accounts receivable the money is recovered from the merchandise that leaves the company.