The dog ate my homework
by David Carter on 01 March 2010
I don’t know if you ever used this excuse at school, but it seems many finance departments are fine-tuning their excuses to delay payments.
New research by Creditsafe highlights the accounting tricks routinely being used. For example, more than one in 10 companies has been forced to reissue at least 20% of client invoices in the last 12 months and a staggering 96% of UK companies have been forced to reissue a customer invoice in the last 12 months.
Despite the fact that these delaying tactics are causing problems for creditors, especially smaller businesses, these firms are asking for replacement invoices so as to restart the timescale for payment.
Now, they’re not actually saying the dog ate their homework, but 71% are saying they never received the invoice, and 8% are querying the value of the invoice. Other reasons are that the PO number is wrong, it was sent to the wrong person or the wrong address.
Then they uncovered a whole box of tricks about delaying cheque payments – failing to sign it, getting the amount or date incorrect.
But Creditsafe also uncovered some excuses that even better than the dog/homework one:
- “I’m too important to read my post, so why would I know you billed me”- “I’m going through a divorce, please issue the invoice to my soon to be ex-wife!”
- “My husband has my cheque book and he has now been put in prison”- “Our accounts lady is off at the moment as her cat died”.
- ”The finance director had a heart attack due to stress and can’t sign cheques in hospital.”- “The customer couldn’t get into the office to get the cheque book because the locks had been superglued by travellers. The cheque was for £18,000.”
- “The goods were signed for in a different colour pen to the one our warehouse manager normally uses, so we have to check it was definitely him who signed for the merchandise before we pay you.”- “My wife has gone off to look after the grandchildren for a week and taken the business cheque book with her.”
Entertaining as these excuses may be, it can be bad news for creditors. Please thoroughly check out companies before you supply them and get solid terms and conditions in pace before you start trading. If they’re a poor credit risk or habitual late payers, think carefully before you get involved.
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