Scribd
Upload
26 views1 page

Order To Cash

The 'Order to Cash' process involves a company providing goods or services to a customer and collecting payment, beginning with order placement and ending with payment collection. It requires collaboration among various departments, including Sales, Shipping, and Accounting, and utilizes several key documents such as Sales Orders, Shipping Documents, and Sales Invoices. This process is crucial for financial control and customer service, ensuring proper sales recording and cash flow for the company.

Uploaded by

ALIHYA SHIN
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
26 views1 page

Order To Cash

The 'Order to Cash' process involves a company providing goods or services to a customer and collecting payment, beginning with order placement and ending with payment collection. It requires collaboration among various departments, including Sales, Shipping, and Accounting, and utilizes several key documents such as Sales Orders, Shipping Documents, and Sales Invoices. This process is crucial for financial control and customer service, ensuring proper sales recording and cash flow for the company.

Uploaded by

ALIHYA SHIN
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 1

ORDER TO CASH

The "Order to Cash" process is an important part of a business where a company provides
goods or services to a customer and receives payment in return. It begins when a customer
places an order and ends when the company successfully collects the payment. This
process shows how resources are distributed in exchange for a promise of future payment,
and eventually, customers pay in cash or other forms for the products or services they
received.

Several accounts are affected during this process, including Sales, Sales Returns,
Allowances, Discounts, Receivables, Allowance for Bad Debts, Bad Debts Expense, and
Cash. To manage this process, different departments must work together. These
departments include Sales, Credit, Inventory or Warehouse, Shipping, Billing, Treasury, and
Accounting. Each one has a specific role to ensure that everything runs smoothly from
order placement to payment collection.

Various documents are used throughout the Order to Cash cycle. The Sales Order contains
the details of the goods ordered and is created by the Sales Department. Then, the
Shipping Department prepares the Shipping Document, which describes the goods to be
delivered. Once the goods are shipped, the Billing Department issues a Sales Invoice,
which shows the amount due and the terms of payment. To help match customer
payments with their invoices, a Remittance Advice is used. Finally, Daily Summaries are
prepared to record all the transactions that happened during the day.

These documents are shared across departments, such as the Customer, Credit, Shipping,
Billing, and Accounting teams. The overall goal is to make sure sales are properly recorded
and that payments are fully collected. This ensures that the company has enough cash to
continue operating and growing. The Order to Cash process is a key part of financial control
and customer service.

You might also like