Unit 15 Operating a cash management and credit control system

15.1 Monitor and control cash receipts and payments

This is about ensuring cash receipts and payments are maintained and controlled.

• Keeping records of cash receipts and payments and identifying anomalies
• Forecasting cash payments and receipts to ensure sufficient cash is available
• Compliance testing of procedures for cash receipts and payments (audit).

15.2 Manage cash balances

This is about cash management and ensuring sufficient funds are available to the organisation.

• Arranging overdraft and loan facilities according to anticipated requirements
• Investing surplus funds where permitted
• Ensuring financial regulations and security arrangements are followed
• Ensuring sufficient cash is available, should there be sudden economic and financial changes
• Compliance testing of cash management procedures (audit)
• Verifying funds and balances (audit).

This is about managing credit facilities.

• Agreeing credit terms with customers according to your organisation’s policy
• Using credit checking agencies or other devices to identify any risks
• Opening credit facilities for customers, or refusing credit, where appropriate
• Compliance testing of credit management system (audit)
• Reviewing agreed credit limits to ensure that these are not exceeded (audit).

This is about managing receivables.

• Monitoring accounts receivable
• Providing information to customers about their accounts
• Providing information on receivables to the organisation
• Collecting debt by appropriate methods eg telephone
• Recommending writing off bad, or doubtful debts
• Reviewing doubtful debt provision (audit)
• Reviewing average time for payment against credit policies and previous period results (audit).