Best Accounts Receivable Interview Questions To Ask A Candidate

June 30, 2023

best accounts receivable interview questions to ask a candidate

Just as cash is the lifeblood of any business, so are the individuals who manage it. And when it comes to the management of cash inflow, Accounts Receivable (AR) professionals hold a crucial position in the business.

That is why finding the right candidate for your AR roles has to be a well-considered decision, particularly during the interview stage.

As a hiring manager, you need a clear grasp of the essential accounts receivable interview questions.

Here are 15 interview questions to thoroughly evaluate your AR candidates.

1. Can you explain what the accounts receivable process is?

This question helps the interviewer assess the candidate's basic understanding of accounts receivable (AR).

It allows them to gauge whether the candidate understands the key components of the process, such as billing, tracking invoices, and following up on unpaid bills.

2. How have you minimized errors in the AR process in your previous jobs?

The precision in managing accounts receivable is crucial as errors can lead to serious financial discrepancies.

This question allows the interviewer to learn about the candidate's attention to detail, their methodical approach to the work, and any specific strategies or systems they've used to minimize errors.

3. What strategies have you used to reduce the Days Sales Outstanding (DSO)?

DSO measures the average number of days it takes a company to collect payment after a sale has been made. A lower DSO indicates better cash flow.

By asking this question, the interviewer can understand the candidate's knowledge of cash flow management and their ability to implement strategies to improve it.

4. Can you describe how you handled a difficult customer in the course of collecting a payment?

Collection is a critical aspect of accounts receivable and sometimes involves dealing with difficult customers.

This question helps to reveal the candidate's interpersonal and negotiation skills, their level of patience, and their ability to remain professional under challenging circumstances.

5. What information do you usually include in an invoice?

best accounts receivable interview questions to ask a candidate

The details in an invoice are important for both legal and practical reasons.

This question allows the interviewer to assess the candidate's knowledge of the standard elements that should be included in an invoice.

Their answer will reveal their understanding of what is needed for effective billing and record keeping.

6. How familiar are you with accounting software? Can you name some you've used in the past?

Today, almost all accounts receivable processes are managed through specialized software. This question allows the interviewer to assess the candidate's technological proficiency and familiarity with the tools commonly used in the industry, such as QuickBooks, Xero, or SAP.

7. Can you explain the term 'aging of accounts receivable' and why it’s important?

Aging of accounts receivable is a technique that sorts receivables by the due date to determine which invoices are overdue. It's important for identifying potential issues with collections.

This question tests the candidate's understanding of this key financial concept and its relevance to the management of accounts receivable.

8. Tell me about a time you improved a process in your previous AR role.

This question lets the interviewer evaluate the candidate's initiative and problem-solving skills.

It provides an opportunity to discuss the candidate's ability to analyze existing processes, identify areas for improvement, and implement changes that result in better efficiency or accuracy.

9. How do you prioritize your work?

Accounts receivable tasks often involve juggling multiple responsibilities and deadlines.

This question can help reveal the candidate's organizational skills, time management ability, and their approach to planning and prioritizing tasks.

10. What steps would you take if a client were not paying their invoice on time?

best accounts receivable interview questions to ask a candidate

Late payments can significantly impact a company's cash flow.

This question assesses the candidate's skills in handling such situations, including their ability to communicate effectively, negotiate, and problem-solve.

It also allows the interviewer to gauge the candidate's understanding of any legal or company-specific procedures related to late payments.

11. How do you handle the risk involved with credit sales?

Credit sales can increase revenue but come with the risk of non-payment. This question assesses the candidate's understanding of the risks involved and their ability to manage and mitigate these risks, whether through credit checks, insurance, or other means.

12. Can you describe the accounts receivable turnover ratio and its significance?

The accounts receivable turnover ratio measures a company's effectiveness in collecting its receivables or extending credit.

The interviewer is assessing the candidate's understanding of this key financial metric and its implications for the company's liquidity and credit management practices.

13. How do you keep track of customer queries and how do you ensure they’re resolved?

This question assesses the candidate's organizational and customer service skills.

Effective tracking and resolution of customer queries are crucial to maintaining good customer relationships and ensuring prompt payment.

The candidate's response can also reveal their proficiency with customer relationship management (CRM) systems or other tools used for this purpose.

14. Tell me about a time you successfully negotiated a payment schedule with a customer.

Negotiation skills are essential when dealing with customers who are unable to pay their invoices on time.

This question allows the candidate to demonstrate their interpersonal skills, problem-solving abilities, and their experience in reaching mutually satisfactory agreements.

15. How do you maintain the confidentiality of our customers’ sensitive financial information?

Financial roles often involve handling sensitive data.

This question assesses the candidate's understanding of data privacy regulations and practices, as well as their commitment to maintaining confidentiality.

Their response can also provide insight into their knowledge of security measures and protocols for safeguarding financial information.

Is there another way to assess accounts receivable skills?

While interview questions can be used to assess accounts receivable skills, you should also consider incorporating an accounts receivable test into your hiring process.

An accounts receivable test provides quantifiable results and allows for a direct comparison of candidates' performance. It reduces the subjectivity associated with interview assessments and provides a more objective evaluation of an individual's skill level.

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