Accounts receivable
Accounts receivable is the money customers owe your business for goods or services already supplied on credit.
Accounts receivable, often shortened to receivables, is the total your customers owe you. In everyday language, it is your udhaar: goods given now, money to come later. On the books it is an asset, but it is only worth something if it is collected.
Example
| Customer | Balance | Oldest unpaid bill |
|---|---|---|
| Shah General Store | Rs 45,000 | 12 days |
| Madina Traders | Rs 120,000 | 48 days |
| Bismillah Kiryana | Rs 35,000 | 75 days |
| Total receivables | Rs 200,000 |
A distributor has Rs 200,000 out with three shops. The total looks healthy, but the detail matters. Rs 155,000 of it, from Madina Traders and Bismillah Kiryana, has been unpaid for more than a month. That is the money to chase first.
Bismillah Kiryana has not paid for 75 days. Before giving that shop more goods on credit, the distributor should collect at least part of the Rs 35,000.
Why it matters
- Cash tied up in receivables cannot pay suppliers or salaries.
- The older a balance gets, the harder it is to collect.
- A customer who keeps buying while an old balance grows is a warning sign.
How software handles it
Receivables are the sum of your customer ledgers. In Taajir, each customer's ledger updates as you bill and receive payments, and you can send payment reminders on WhatsApp so collection does not depend on remembering. Our guide on how to collect udhaar payments has practical steps.
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