Everything You Need to Know about Accounts Receivable Specialist Job Descriptions & Duties

Introduction

The finance function within any organization comprises various elements – treasury, accounts payable, budgeting and planning, finance, and more. While each plays a crucial role in improving operational efficiency, accounts receivables are the key to greater revenues and cash flow, contributing to financial stability. 

To ensure that this primary business element stays robust and efficient, companies need accounts receivable professionals with deep expertise vital to maximize cash flow and collections while fostering strong customer relationships. Want to know more about how they play an important role in driving AR success? This blog will help you take a deep dive into accounts receivables duties, responsibilities, and job functions. Let’s find out more. 

What Does an Account Receivable Professional Do?

As part of the accounts receivable department, an accounts receivable professional normally manages customer accounts and billing and ensures that invoices are collected on time. They are also required to follow up with customers for overdue payments and maintain stable cash flows. 

These professionals also provide any administrative and clerical aid needed to ensure accuracy in financial books and help the management make effective decisions. This may also include: 

• Identifying areas for improvement in the collections process and implementing changes to enhance efficiency.
• Investigating and resolving billing disputes or discrepancies in a professional manner.
• Assessing and managing customer credit limits and terms based on payment history and financial stability. 
• Preparing reports and analyzing accounts receivable status, aging, and collection performance for management review.

One of the main objectives of an account receivable professional is to reduce day sales outstanding (DSO) by fast-tracking customer payments and making sure that revenues are actually materialized. . They are also required to communicate the payment terms and due dates on invoices to avoid confusion, review and adjust payment terms, regularly analyze DSO metrics, and identify trends and areas for improvement.

Roles and responsibilities of AR functions: What the job description entails?

Accounts receivable job functions include managing and tracking financial transactions to ensure adequate working capital, accelerating payments from customers, and negotiating favorable terms with customers. AR roles can include: 

• Accounts receivable specialists

  An account receivables specialist manages all aspects of the AR process, including collections, invoicing, and maintaining accurate customer records. They also perform other financial functions, such as ensuring accurate posting to ledger accounts and tracking receipts. 

• Accounts receivable clerk 

  An accounts receivable clerk collects payments for goods and services sold to customers while ensuring seamless customer experiences and administration. They will also collaborate with other departments to verify and record transactions, resolve disputes, and remove anomalies from collection processes. 

• Accounts receivables officer

  An accounts receivable officer manages and controls all financial transactions related to a business’s accounts receivable, like maintaining customer accounts, generating and delivering invoices, posting receipts, and applying credit risk mitigation strategies. 

What Are the Main Tasks of an AR Professional?

A large part of the accounts receivable job functions include replying to customer queries, resolving billing issues, processing requests for data from other departments, etc. Most importantly, they ensure that all financial transactions are carried out seamlessly and accurately.

Here are a few important account receivable job functions.

• Manage invoices and billings 

  AR professionals ensure the accuracy of invoices and that they are sent to customers on time, enabling timely payments. Additionally, these professionals track outstanding payments, upload andtrack invoices on customer portals, monitor customer behavior changes, and communicate clearly with customers, reminding them of overdue payments. 

  With the adoption of e-invoicing on the rise, an AR professional ensures that invoices are accurately generated and presented through the EIPP (electronic invoicing system presentment and payment), reflecting the correct amounts, due dates, and terms. They also manage and update customer preferences for receiving invoices, such as electronic formats or delivery methods. Lastly, they also communicate effectively with customers regarding invoice delivery, payment reminders, and any issues related to invoice delivery, payment reminders, etc.

• Tracking payments

  A vital part of AR’s job duties includes monitoring customer payments. They must review customer accounts, track their payment behavior regularly and promptly address the issue. Additionally, they apply their strong attention to detail, reconcile account discrepancies, resolve disputes, and negotiate payment terms. 

  Today, businesses are using cutting-edge accounts receivable and accounts payable tech to streamline their invoice payment requirements. For instance, many companies need suppliers and their AR teams to log in to their AP portals and upload and track invoices. 

  In such complex work processes, an AR professional must know how to use advanced collection features to review customer accounts, reduce repetitive tasks, assess payment histories, and identify overdue accounts. Moreover, they can develop and implement collection strategies based on insights from the system, including defining priorities for collection efforts and tailoring approaches for different customer segments.

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  Accounts Receivable Aging Report Excel Template

• Cash application 

  AR professionals are responsible for accurately applying customer payments to their accounts and ensuring all payment records are posted accurately in financial books, facilitating easy identification of overdue balances. 

  When working with advanced, automatedcash app management, an AR professional also ensures that these systems are customized to align with business processes, such as setting rules for matching payments to invoices and handling exceptions. They also develop and implement procedures for managing and resolving exceptions. 

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• Improving collections 

  AR professionals must implement and manage collections strategies essential to recovering overdue accounts. They may also have to work with collections agencies in disputes and prepare accounts for legal action if needed. They must also develop strategies to follow up on overdue payments and negotiate settlements. 

  Additionally, to ensure smooth functioning with the advanced collections cloud, they develop and implement collection strategies based on insights from the system, including defining priorities for collection efforts and tailoring approaches for different customer segments. AR experts will also address and resolve disputes or issues flagged by the system and ensure timely and accurate resolution while maintaining detailed records of disputes and resolutions for compliance and audit purposes.

• Analyzing and reporting 

  An expert accounts receivable professional calls for proficiency in financial analysis, assessing and gathering complex customer information, providing meaningful insights, and helping drive informed decision-making. These reports must highlight areas of improvement and help the upper management track key performance metrics.

  Today, many AR systems leverage advanced analytics to help AR employees pinpoint inefficiencies or bottlenecks in the AR processes, develop and implement strategies based on data insights to enhance collection processes, and compare performance metrics against industry benchmarks to evaluate the effectiveness of the collection strategies. 

  One of the main objectives of an account receivable professional is to reduce day sales outstanding by accurately forecasting DSO, fast-tracking customer payments, and ensuring that revenues are actually materialized. They are required to communicate the payment terms and due dates on invoices to avoid confusion, review and adjust payment terms, regularly analyze DSO metrics, and identify trends and areas for improvement. 

Accounts Receivable Duties and Responsibilities

In a smaller organization, an AR professional may just handle a broader range of accounts receivable duties and responsibilities and oversee all responsibilities related to financial transactions, ensuring customers are billed correctly, and payments are collected on time. However, in larger organizations, AR professionals may have to specialize in accounts receivables only. They will play a crucial role in maintaining adequate liquidity and financial health by managing and collecting receivables. 

In addition to this, an accounts receivable professional may work in an on-premise or hybrid environment. They may need to contribute more hours in cases of backlogs, when important deadlines are around the corner, or to cater to customers from a different time zone. Here are the key AR duties and responsibilities. 

• Payment processing 

  AR professionals are responsible for recording and applying payments to customer accounts accurately.They match payments with corresponding invoices, ensuring all accounts receivables are accurately reconciled, payments are correctly applied, and all transactions are completed and accounted for. 

• Customer account management 

  AR professionals must track overdue payments and outstanding balances and proactively follow up with customers on outstanding invoices through phone calls, emails, or letters. They will also address and resolve billing issues or discrepancies raised by customers and manage accounts diligently to fast-track payment collections. 

• Credit management 

  AR professionals ensure efficient credit management by assessing customer creditworthiness, evaluating their financial stability, and establishing appropriate credit limits based on company policies. Additionally, they regularly review and adjust credit terms and conditions as necessary to adapt to the changes in customers’ payment behavior or financial situation, mitigating credit risk and extending credit terms that save the company’s financial interests. 

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• Record keeping 

  AR professionals are responsible for maintaining accurate and up-to-date records crucial to the AR role.This includes recording all transactions and customer interactions, noting promise-to-pays and payment dates, and all correspondence related to AR. This will further help ensure compliance with company policies and financial regulations and foster transparency and accountability in financial reporting. 

• Maintaining customer relationships 

  To ensure seamless communication with customers, an AR expert has to foster a healthy relationship with customers and act as a point contact for all customer queries. They also collaborate with sales and customer representatives to resolve issues and ensure a frictionless payment process. 

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• Process improvement 

  AR professionals focus on improving the effectiveness and efficiency of the overall O2C cycle. They analyze process data to identify areas for enhancement and implement changes to streamline operations. They will also leverage automation features of the automated AR systems to reduce manual effort and improve overall process efficiency, making the AR function more effective. 

• Compliance and audit 

  AR professionals ensure compliance with internal controls and external regulations related to financial transactions and reporting. They also assist with internal and external accounting audits by making all necessary documentation and information readily available.

AR Professional Skills and Qualifications

An AR professional must have the following qualifications: 

• An associate’s degree or equivalent 
• Experience working in accounts receivable
• Proven work experience in building process improvement

Apart from this, they must have the following skills: 

• Maths accounting

  The skill will help AR professionals track cash flows in a business and ensure all payments are received on time and recorded correctly. The skills also involve knowledge of basic financial concepts like taxes, profit and loss, and pricing and identifying any potential areas of risk or loss due to errors or anomalies in the bookkeeping. 

• Attention to details 

  This skill is critical for any AR professional as it helps ensure quick and accurate payments, eliminating or resolving any errors or discrepancies in the records. AR professionals must focus on timely payments from customers, log transactions into the system without any errors, verify the accuracy of invoices, match up receipts with purchase orders, reconcile deposit slips, and detect anomalies before they impact the entire order to cash cycles. 

• Tech proficiency 

  With the rise of automated AR systems, accounts receivable professionals must be proficient in handling advanced systems. They must have a basic understanding of checking whether relevant data sources, including ERP, CRM (customer relationship management), and other financial systems, are integrated into the analytics platform.. They might also require setting up dashboards and reports tailored to the company’s needs, focusing on key metrics and performance indicators. 

The Changing Role of Accounts Receivable Professionals in the Era of Automated AR Systems

With automation streamlining repetitive and mundane tasks in accounts receivable, AR professionals are transitioning to more value-added and strategic responsibilities. While AR automation handles routine tasks such as invoicing and payment reminders, AR professionals will focus on strategic oversight, data analysis, customer relationship management, and process improvement. This shift allows them to contribute more significantly to business value, drive efficiencies, and support strategic decision-making.

Here’s how accounts receivable job functions are evolving in the era of automation.

• Strategic oversight and analysis 

  With automation handling routine tasks, AR professionals will have to be proficient in strategic roles, focusing more on analyzing data generated by automated systems to streamline cash flows, predict customer payment behaviors, and enhance overall financial performance. Their role will involve interpreting this strategic foresight to make informed decisions, collect strategies, and forecast financial trends. 

• Optimize processes

  As manual processes become automated, AR professionals will be responsible for continuously monitoring and refining automated workflows. They will identify areas to improve, implement best practices, and ensure the tools and features of the advanced automated tools function effectively to enhance operational efficiency.

• Handle exceptions 

  Automated systems are designed to handle most tasks but may encounter exceptions or anomalies that require human intervention. AR professionals will need to manage and resolve these exceptions, like discrepancies in payment applications or unusual customer account activity, ensuring that issues are addressed promptly and accurately. 

• Credit risk management 

  The rise of automated systems will shift AR professionals’ focus towards more nuanced credit risk management. They would need to use more sophisticated credit management features for accurate data and analytics. This will further help them adjust credit limits, manage risk profiles, implement strategies to mitigate financial risks, and make proactive decisions about credit policies. 

• Data management and quality control

  With automation generating large volumes of data, AR professionals will be responsible for managing and ensuring the quality of this data. They will oversee data accuracy, address any inconsistencies, and ensure that the data used for reporting and decision-making is reliable and up-to-date. 

Enhance Your AR Team’s Efficiency With HighRadius’ Cutting-Edge Accounts Receivable System 

HighRadius provides a powerful, cloud-based Order to Cash(O2C) solution designed to automate and streamline your financial operations. Our comprehensive suite includes Collections Management, Cash Application, Deductions Management, Electronic Invoicing, Credit Cloud, and dotOne Analytics, enhancing the efficiency of your team and optimizing workflows.

Global leaders like P&G, Ferrero, Johnson & Johnson, and Danone trust HighRadius to automate cash posting, reduce invalid deductions, and eliminate bank key-in fees. Our solutions help businesses achieve tangible results:

1. HighRadius’ AI-powered collections software helps prioritize worklists for the top 20% of customers and automates collections for 80% of long-tail customers. This results in a 20% reduction in past-due accounts and a 30% increase in collector productivity.
2. With AI-driven data capture and matching algorithms, HighRadius achieves 90% automation in same-day cash application, eliminating bank key-in fees entirely and boosting team productivity by 30%.
3. HighRadius’ AI-powered deduction management software accelerates deduction research and resolution, enhancing analyst efficiency by 40% and improving net recovery by 30%.
4. HighRadius’ AI-based credit solution provides real-time credit visibility and global portfolio management, reducing bad debt by 20% and improving credit application approval time by 90%.
5. HighRadius’ AI-powered Electronic Invoicing Solution enhances customer experience with a self-serve portal for buyers and multi-channel invoice delivery, increasing billing analyst productivity by 20%.
6. Using HighRadius Analytics, you can make informed decisions with visualized data. Track operational KPIs and enable data-driven decision-making through comprehensive reports and peer benchmarking.

In addition to this, HighRadius seamlessly integrates with leading ERPs like SAP and Oracle, ensuring a smooth and comprehensive O2C process. This integration allows businesses to leverage existing systems and data, significantly enhancing overall efficiency and accuracy.

FAQs

1) Is an accounts receivable role an accounting job?

Accounts receivable roles can be considered accounting jobs because they involve using accounting principles. They handle financial tasks like ensuring timely customer payments, tracking invoices, utilizing financial insights for accurate bookkeeping and auditing, etc.

2) What is the importance of an accounts receivable professional?

AR professionals are responsible to drive key elements of business processes including order to cash cycles. They are responsible for tracking and managing accounts and billing, following up customers to ensure timely payments, removing anomalies and discrepancies from the AR processes, etc. 

3) How can I excel in an accounts receivable role?

To excel in an accounts receivable role, you must ensure: 

• A strong understanding of financial reporting and accounting principles
• Attention to accuracy and detail
• Familiarity with automated AR suites and spreadsheet programs
• Problem-solving and negotiation skills to deal with late payments and disputes

4) What qualifications are required for an accounts receivable role?

An accounts receivable professional must have the following qualifications and skills: 

• Expertise in with QuickBooks and ERPs like Oracle and SAP
• Associate degree or equivalent
• Strong understanding of accounting principles and bookkeeping 
• Experience in facilitating process improvements

5) What are the main accounts receivable job duties?

The main accounts receivable job duties include:

• Driving efficient cash application functions
• Maintaining customer relationships and managing customer accounts
• Handling invoices and billing 
• Assessing customer behavior
• Streamlining collections
• Financial reporting and analyzing 
• Mitigating credit risk

6) What does an accounts receivable officer do?

An accounts receivable officer handles all financial transactions, ensures error-free billing to customers, and collects payments on time. It also includes: 

• Maintaining customer accounts
• Increasing operational efficiency with automated AR features
• Adjusting credit policies to mitigate credit risk