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Commissions Best Practices
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commissions that are regularly audited, automatically calculated, and only paid
from actual cash receipts—reduces the work of the accounting staff to a remark-
able degree. Those best practices affecting the payment of commissions have a
much smaller impact on accounting efficiency, while the one item affecting the
motivation of the sales staff does nothing to improve the accounting department.
Accordingly, the bulk of management attention in this area should go to improving
the efficiency of calculating commissions.

SUMMARY
This chapter concentrated primarily on ways to reduce the time, effort, and number
of errors in the calculation of commissions, with a reduced emphasis on better ways
to pay commissions once they have been calculated. They are mostly easy best
practices to implement. However, as noted several times in this chapter, several of
them will directly affect the sales staff and so require the approval of the sales
manager before they can be implemented. Since some of these changes will not
be popular with the salespeople, do not be surprised if that approval is not forth-
coming. If so, an occasional review of unapproved best practices may eventually
find a more malleable sales manager in place, with a different result. Thus, if at
first you don’t succeed, try, try again.