A final important consideration regarding cash receipts is establishing an adequate credit policy. Companies need to have an adequate policy in place establishing to whom credit should be extended, the time length and amount of the credit, and any other trade credit terms. While extending credit may be costly for a company, there is also an opportunity cost associated with losing clients and sales because of a lack of a credit policy. On the other hand, there are also costs associated with assessing the creditworthiness of the clients and managed accounts.

What is the credit policy in your company?

I JUST NEED ONE PARAGRAPH FOR THIS WITH PROPER REFERENCE.