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Billing Best Practices
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difficult for most accounting software systems, but the controller must remember
to shift back to the current period after the invoice processing has been com-
pleted; otherwise, all other current transactions that are subsequently entered will
be recorded in the next accounting period, rather than the current one.
Cost: Installation time:

4–4 ISSUE ELECTRONIC INVOICES THROUGH THE INTERNET
The traditional invoicing process is extraordinarily wasteful in terms of the effort
and time that goes into creating and issuing an invoice. It must be created and
inserted into an invoice printing batch, which in turn requires the use of a cus-
tomized invoice with prepositioned fields and logos, plus a review of the printed
invoices, stuffing into envelopes, affixing postage, and mailing. Even then, there
is a risk that the invoice will be lost in the mail, either due to a problem at the post
office or because the recipient’s address has changed. Further, there are delays at
the receiving company, while the mailroom sorts through the mail and delivers it
internally (sometimes to the wrong person).
Some of these problems can be avoided through the use of e-mailed billings
that are delivered through the Internet. There are several ways to do this. The
least-recommended approach is to post the invoices on a company’s own Web
site. This means that customers can access the company’s credit card payment
system at the same time they access their invoices, which results in accounts
receivable that are collected with inordinate speed. However, this approach requires
customers to access the company’s Web site in order to find their invoices, which
they are not likely to do (especially because this will result in their immediate use
of funds to pay for the invoice). In addition, this requires an interface between the
accounting database and the Web site, so that invoices are posted regularly to the
Web site. Further, there may be a need to create user identification numbers and
passwords, so that they can access their invoices (otherwise they would be view-
able by all visitors to the Web site). Also, if customers forget their access codes,
there must be an internal customer service function that can assist them with this
information, and this involves additional personnel costs to maintain.
A better approach is to “push” electronic invoices to customers by e-mail.
This requires the collection of an e-mail address from each customer at the time
an order is taken (or verification of an existing one when a reorder occurs). This
address is then attached to an electronic invoice form that is generated, instead of
a paper-based invoice, and issued to the customer over the Internet. It is then
available to the customer a few moments later, allowing for immediate payment
(possibly) or at least a quick perusal of the invoice and a return of information to
the company regarding any problems discovered by the customer. This approach
greatly reduces the time required to get invoicing information to the customer.