Accounts Receivable Market Definition

Accounts receivable (AR) software helps automate and optimize customer invoicing and payment collection. It streamlines financial transactions between a company and its customers, helping businesses of all sizes get paid faster, reduce manual work, and improve payment accuracy. This ultimately boosts cash flow, enhances profitability, and provides important data for financial reporting. It is used by accountants and the employees responsible for accounts receivable, but sales and customer service teams can also use it to track customer payment statuses and answer customer questions related to billing or payments.

While standard accounting software includes basic AR functions, specialized AR solutions offer more advanced features, such as generative AI, predictive analytics, and customer self-service portals. This software mostly integrates with accounting software or enterprise resource planning (ERP) systems, and larger companies often connect it with financial planning and analysis (FP&A) software for even greater benefits.

To qualify for inclusion in the Accounts Receivable category, a product must:

• Manage different types of customer transactions such as invoices, credits, or payments
• Match invoices, credits, and payments with quotes and sales orders to ensure the correct amounts are being processed
• Provide workflows that can be used to define rules and exceptions for AR processing
• Include customizable approval processes for all types of AR transactions
• Deliver reports and analytics on the status of invoices or payments, customer credit, or transaction history
• Offers forecasting capabilities to predict future cash flow
• Integrate with accounting software or accounting modules of ERP solutions

Results Index Description

A product’s Results score is calculated by a proprietary algorithm that factors in real-user satisfaction ratings for a number of results-related review questions. Software buyers can compare products in the Accounts Receivable category according to their Results scores to streamline the buying process and quickly identify the products that produce the best results based on the experiences of their peers. For sellers, media, investors, and analysts, the Index provides benchmarks for product comparison and market trend analysis.

Badges are awarded to products for: Best Results (highest overall Results score), Best Estimated ROI (based on a combination of estimated time to ROI and time to go live), and Users Most Likely to Recommend (highest likelihood to recommend score).

Products included in the Results Index for Accounts Receivable Automation | Winter 2023 have received both a minimum of 10 reviews and 5 responses from real users for each of the results-related questions featured in our review form by November 22, 2022. These ratings may change as the products are further developed, the sellers grow, and as additional opinions are shared by users. A new Results Index report will be issued for this category as significant data is collected.