Accounts receivable is best described as an asset of a business created by one of the business’s customers purchasing a good or service from the business on credit i.e. invoice of the business to be paid at a later date. When the customer fails to pay the business by the later date, then the business has an account receivable. When a business has an account receivable, this is effectively a breach of the contract created between the business and its customer. When there is a breach of contract then the business has a cause of action against the customer for damages. In other words, if the business so chooses, it may bring a law suit against the customer and try to recover the amount that the customer promised to pay the business. In Texas, the Texas Practices and Remedies Code 38.001 allows for the recovery of attorney’s fees in any breach of contract case. This is important because many businesses would not bring suit to recover their damages if they had to be out of pocket for their attorney’s fees just to recover the cost of the service or good that was sold to the customer. If you have an account receivable, contact our Firm and we will send your customer a letter seeking payment from them for the account receivable and letting them know that our Firm plans to pursue other courses of action including but not limited to litigation if the customer does not pay by a certain date. Many times, upon receiving this letter the customer will pay the account receivable.
Businesses who sell a good or provide a service to another business can also have accounts receivable. In that instance, the letter would be sent to the business who received the good or service. Many small to medium size businesses have accounts receivable that are just sitting in their accounting department waiting to be paid. If you find yourself with a stack of accounts receivable, then call our Firm and we will send out letters on your behalf to recover these important lost profits for your business and file suit on your behalf if your accounts receivable is not paid.