oboloo

oboloo Glossary

Receivables

oboloo Glossary

Receivables

Receivables Definition

Receivables are defined as the money owed to a business by its customers for goods and services that have been provided. This could include money that is owed for products that have been sold on credit, or for services that have been rendered. Receivables can also take the form of loans or advances that have been made to customers, which they are obligated to repay.

In order for a receivable to be considered valid, there must be an agreement in place between the two parties involved stating that the customer will indeed pay the money owed. This agreement can be in writing, or it can simply be an oral agreement. Once the agreement is in place, the receivable is considered valid and can be recorded on the books of the business.

Receivables are important because they represent money that is owed to the business and therefore can be used to generate income. This money can then be reinvested back into the business or used to cover other expenses. Additionally, receivables can provide businesses with a source of short-term financing if they need it. If a business has a lot of receivables, they may be able to use them as collateral when taking out a loan from a bank.

It’s important for businesses to keep track of their receivables and stay on top of collections so that they don’t become delinquent. Delinquent receivables can negatively impact a business’s cash flow and bottom line.

Want to find out more about procurement?

Access more blogs, articles and FAQ's relating to procurement

Oboloo transparent

The smarter way to have full visibility & control of your suppliers

Contact

Feel free to contact us here. Our support team will get back to you as soon as possible

Oboloo transparent

The smarter way to have full visibility & control of your suppliers

Contact

Feel free to contact us here. Our support team will get back to you as soon as possible

© 2024 oboloo Limited. All rights reserved. Republication or redistribution of oboloo content, including by framing or similar means, is prohibited without the prior written consent of oboloo Limited. oboloo, Be Supplier Smart and the oboloo logo are registered trademarks of oboloo Limited and its affiliated companies. Trademark numbers: UK00003466421 & UK00003575938 Company Number 12420854. ICO Reference Number: ZA764971