Why have controls over revenues and receivables?

Your company’s revenues are what it makes in selling its services and goods and it’s what helps you cover expenses made. Recognizing revenue is one thing, but with it you’d also recognize a receivable and it’s what ensures you also get resources from what you earned. 

Monitoring your revenue and profitability, having controls over your revenue ensures that your revenue is recognized in correct amounts, against correct customers and timely. The controls are yours to define and implement. Examples include comparison with sales prices agreed, confirming balances and transactions, comparing shipments to orders etc.

By also reviewing your receivables, by implementing controls over the balances, over their collectability ensures that you also get paid for what you sold and it shouldn’t be underestimated. Have a regular routine for reviewing certain outstanding balances, by implementing credit limits and comparing outstanding amounts against those limits etc. Note that the complexity and extent of such controls is dependent on the complexity of your business and the structure of your company as well (i.e. if there are various people responsible for sales).

The sole aim of a company who is in it for doing business is to earn profits and it all starts from your revenues. Do not underestimate the importance of your company’s revenue and receivables and the impact if something goes wrong with them.