Glossary
What is Accounts receivable?
Accounts receivable is the money customers owe for goods or services already delivered but not yet paid for, typically from credit sales. It is an asset until the customer settles, and it is the figure that decides how much cash a shop actually has.
Accounts receivable is the total your customers still owe for sales you have already billed. It counts as income in the month you sold, but you cannot pay a supplier with it until it is collected.
How it works in practice
An illustrative example. A wholesale distributor in Birtamod bills a kirana shop Rs 60,000 on 15 days’ terms. Receivables rise by Rs 60,000 the day the invoice is issued. The shop returns Rs 4,000 of damaged goods, recorded on a credit note, so the balance becomes Rs 56,000. A part payment of Rs 30,000 arrives by eSewa, leaving Rs 26,000 open against that invoice until it clears.
The distributor’s month may look profitable and still leave it short for its own supplier payments, because Rs 26,000 of that sale is still with the customer.
Udhaaro is receivables
In most Nepali shops receivables go by another name: udhaaro, the credit a regular customer runs up and settles at month end or after Dashain. The accounting is the same whether the record is a khata or software. What differs is whether you can see, customer by customer, which bills are overdue.
The due date matters more than the balance. A large balance within terms is healthy. A smaller one that is mostly past due is where bad debt starts. Sending the customer a statement of account, invoice by invoice, turns a vague reminder into a short and specific conversation.
Common mistakes
- Counting a credit sale as cash in the day’s takings.
- Letting a customer’s limit creep upward without anyone deciding it should.
- Reducing a balance by editing the invoice instead of issuing a credit note, which also breaks the VAT record.
- Recording a payment without linking it to the invoice it settles, so the shop and the customer disagree about what is left.
Kuver Books builds receivables from approved sales invoices, customer payments and credit notes, and the accounts receivable help page explains filtering by customer and due date.
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