THE LONGER YOU KEEP A PAST DUE
ACCOUNT ON THE BOOKS THE LESS CHANCE THERE IS OF COLLECTING IT.
Cash flow is the engine that drives business both large and
According to survey results the probability of full
collection on a delinquent account drops dramatically with the length of the
delinquency. For example, even after three months the probability of collecting
a delinquent account drops to 70%. After six months collectability drops to 52%.
And after one year the probability of ever collecting a delinquent account drops
The results of this survey clearly demonstrate the critical
importance of taking positive action when an accounts receivable ages past its
This applies to whatever industry or field your firm is
involved with. Delinquent accounts, if they are permitted to age, can diminish a
company’s liquidity, as well as infringe upon valuable management and staff time
that can be put to far better use.