No matter what name they go by, whether late fees, finance charges, assessments, or late payment penalties, fees charged when you forget or omit to pay a bill on time can accumulate and have a significant negative impact on your bottom line. There are simple techniques to help you avoid fees and generally improve your cash flow management. The first is to incorporate reminders for recurring payments into your accounting software. For nonrecurring payments, enter the invoices you receive regularly, include a due date, and set a reminder. QuickBooks allows you to do this easily. Periodically, you should also ensure that suppliers’ coordinates have not changed, to ensure the payments you do make reach their destination. If you receive an invoice that you feel is incorrect and do not want to pay it, the worse mistake you can make is to ignore it. Instead, promptly contact the supplier and voice your concerns. If there is a dispute, waiting without making contact only makes matters worse. Finally, set aside time to perform audits of your books and records, at least monthly, to ensure nothing has gotten lost in the shuffle. Running a small business is a lot of work, and if the bookkeeping functions are too much and causing you to pay late fees when you really shouldn’t be, consider the possibility of outsourcing some of the bookkeeping tasks.
Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.