# Accounts receivable

> Accounts receivable is the money customers owe you for goods or services already supplied on credit. It sits in your balance sheet as trade receivables (sundry debtors), and collecting it on time is what turns your sales into cash.

In EaseDesk: EaseDesk shows what each customer owes under Receipts → Outstanding, and Reports → Receivables ageing splits it by how late it is. Record one receipt against several invoices, with advances and TDS deducted by the customer; invoices carry a UPI QR code and payment link, and payment reminders go by email on the schedule you set under Settings → Organisation → Reminders.

## Why it matters to your business

For most Indian SMEs, the biggest pool of cash is not in the bank but in the market: sales already
made and not yet paid for. Every rupee your customers hold is a rupee you either borrow at interest
or do without. Keeping receivables under control means knowing, every morning, who owes what, since
when, and who has promised to pay.

## How it works

Each credit invoice adds to the customer's balance; each receipt, credit note or TDS entry reduces it.
Matching receipts to specific invoices is what makes the ageing reliable. A wholesaler with ₹12,00,000
outstanding might see:

| Age | Amount | What to do |
|---|---|---|
| Not yet due | ₹5,00,000 | Nothing yet; send a statement |
| 1 to 30 days late | ₹3,00,000 | Reminder with a payment link |
| 31 to 60 days late | ₹2,00,000 | Phone call, confirm a date |
| 61 to 90 days late | ₹1,20,000 | Hold further credit |
| Over 90 days late | ₹80,000 | Owner follows up personally |

The total alone hides the risk; the ageing shows that ₹2,00,000 is more than two months late and
needs attention this week.

## Common mistakes

- **Receipts not matched to invoices.** Money recorded "on account" makes every invoice look unpaid
  and the ageing meaningless.
- **TDS left unrecorded.** Small TDS differences pile up as false dues, and the TDS credit you are
  entitled to goes unclaimed.
- **No fixed credit period.** Agree a credit period with each customer, print the due date on the
  invoice, and follow up from the day after it.
- **Chasing late.** A polite reminder before or on the due date works better than a hard call two
  months later.
- **Never confirming balances.** Send customers a statement periodically; differences found early
  are easier to settle.

## Questions

### Is accounts receivable an asset?

Yes. It is a current asset, shown in the balance sheet as trade receivables or sundry debtors, because you expect to turn it into cash within the year.

### What is a receivables ageing report?

It groups what each customer owes by how long it has been due, such as not yet due, 1 to 30 days, 31 to 60 days, 61 to 90 days and over 90 days. It shows you whom to call first.

### Why does a customer's balance not clear after they pay?

The most common reason is TDS. A customer who deducts TDS pays you less than the invoice, and the difference stays open until you record the TDS against the invoice. Advances and credit notes not set against invoices cause the same problem.

### What can a micro or small enterprise do about late payments?

Under the MSMED Act, a buyer must pay a registered micro or small enterprise within the agreed credit period, which cannot exceed 45 days, and must pay interest if it pays late. Unpaid dues can be referred to the Micro and Small Enterprises Facilitation Council.

---

Source: https://www.easedesk.com/glossary/accounts-receivable · Updated 2026-09-28 · EaseDesk