Accounts receivable (AR) is a subset of bookkeeping. It’s part of a series of accounting transactions that involves billing customers for goods and services. People who work in accounts receivable are known as accounts receivable clerks, accounts receivable specialists, and accounts receivable managers.
Most accounts receivable positions require a degree in business or a related field. Check out the programs below which offer free information:
Bookkeeping in general is associated with steady employment. More than 2 million accounting clerks now work in the United States, and the U.S. Bureau of Labor Services (BLS) has projected that job opportunities will grow by about 10 percent or 200,000 between 2006 and 2016. However, accounts receivable is a very narrow specialty. Managers in AR departments have skills that transfer to other positions, but accounts receivable clerks need to show mastery of additional accounting skills in order to experience career advancement.
With ongoing education, it’s possible to move from an entry-level accounts receivable job to a bookkeeping position with additional responsibilities and higher pay. Such bookkeeping jobs are available in virtually every employment sector. Governments, schools, health care providers, and financial firms have the greatest demand for AR employees.
The primary responsibilities of an accounts receivable clerk are to generate an invoice, ensure that it reaches the consumer, and document payment. While these might seem to be simple tasks, they can quickly become complicated by customers’ late payments and associated alternate payment plans or arrangements with collection agencies.
Accounts receivable managers not only oversee the complexities of billing and collections, but also oversee the approval and denial of credit, customer service, legal considerations, and a number of other day-to-day and long-term business issues. They might also produce reports of gains and losses for managers.
Accounts receivable departments sometimes become responsible for outstanding advances. This happens when a company receives an order with payment given in advance. Clerks might also be asked to post details of transactions, compute interest charges, prepare bank deposits, communicate with customers, code documents, and process adjustments.
As with other accounting jobs, a position in accounts receivable is best for people with excellent attention to detail. The accurate work of AR clerks is essential to maintaining a well-running business. Managers use data from accounts receivable departments not only on a daily basis when calculating gains and losses, but also when applying for corporate loans or selling securities.
Because of the customer service element involved in accounts receivable departments, it’s also important that clerks, specialists, and managers in this department have good interpersonal communication skills.
Training and Education Requirements
The responsibilities of accounts receivable clerks can often be learned through on-the-job training. Nonetheless, employers expect a clerk to have a high school diploma and experience with coursework relevant to accounting. Furthermore, the widespread use of computer-based bookkeeping practices means that computer skills are essential. Typically, Microsoft Word, MicroSoft Excel, and QuickBooks are used.
Compared with bookkeepers, clerks earn slightly less pay. One path to career advancement is to earn an associate’s degree in bookkeeping. Bookkeeping programs address accounts receivable, payroll systems, federal taxes, QuickBooks, and a number of other topics relevant to bookkeeping and accounting. Associate’s programs can be completed in just a year or two, and they provide clerks with an excellent competitive edge. This edge can be further enhanced with a bookkeeping certification from the American Institute of Professional Bookkeepers (AIPB).
Salary and Wages
Data compiled at PayScale.com indicate that accounts receivable clerks earn an average of $13.44 per hour or almost $28,000 annually. Accounts receivable specialists earn an average of $15.40 per hour or about $32,000 annually. Meanwhile, the Bureau of Labor Statistics (BLS) reports that the middle 50% of clerks earned between $26,350 and $40,130 in 2008. BLS also reports that the government is a top-paying employer for the bookkeeping profession. Investment firms, railroad companies, and tobacco firms also offered accounting clerks relatively high pay in 2008.*
*According to the BLS, http://www.bls.gov/oco/
Many people in accounts receivable departments work standard 40-hour weeks plus occasional evenings and weekends. According to BLS, about 25% of clerks worked part-time in 2008. Workloads become especially heavy during tax time, at the end of fiscal years, and when monthly or quarterly reports are due.*
*According to the BLS, http://www.bls.gov/oco/
The International Accounts Receivable Professionals group is currently developing a certification program for accounts receivable professionals. A study manual and computer-based testing will be made available.
AR clerks are also eligible for the Certified Bookkeeper (CB) designation, although passing the exams requires gaining a good deal of knowledge about many aspects of bookkeeping. The CB designation indicates that an individual is prepared to carry out all bookkeeping functions in accordance with accepted accounting procedures.
To earn this certification, an AR clerk must have at least two years of experience with bookkeeping, pass a written examination, and agree to adhere to a code of ethics. Preparatory courses are offered at community colleges and online.
The American Institute of Professional Bookkeepers (AIPB) is a clearinghouse for job opportunities, educational opportunities, bookkeeping tips, and more. http://www.aipb.org. AIPB is located at 6001 Montrose Rd., Suite 500, Rockville, MD 20852.
International Accounts Receivable Professionals (IARP) is a private group that offers training, certification, networking, and a bi-monthly magazine for professionals in accounts receivable. http://www.iarp.org.