Cash conversion
Accounts Receivable
Accounts receivable is valuable only to the extent it is collectible and included correctly in the transaction economics.
Buyer lens
Age receivables, identify disputes and understand who bears collection risk after closing.
Seller lens
Clean old balances, credits and disputes before working capital becomes a price argument.
Why it matters
- Recorded revenue can remain uncollected.
- Old or disputed invoices can inflate working capital.
- Customer concentration can make AR quality materially different from the headline balance.
Evidence to reconcile
- AR aging
- Subsequent collections
- Credit memos/disputes
- Customer concentration
- Allowance/write-off history