Delinquent accounts receivable?

Question

As the company bookkeeper reviewing delinquent accounts receivable, you find that a relative of yours has not paid his account amounts of $550. You know that he has been experiencing financial difficulties, and so you set his account aside and do not include it with the other past due accounts sent to a credit collection agency. Comment on this action.

Answer 1

Completely unethical. You are an agent for the company and therefore obligated to put the company's welfare ahead of your own (or others you know). If this action is found out, you could be fired.

Now having said that, I personally think it WOULD be ethical to ask the relative to make payment arrangements to the company BEFORE sending his account to a collection agency. Perhaps if the agreement is in place beforehand, you could preclude the relative's account from being sent out for collection. I don't think this would be unethical since your company could still get the full amount due (albeit over time). By turning it over to a collection agency, your company would only get a portion of the total amount owed.

So was this a homework question, or an actual event?

Answer 2

I appreciate your loyalty to your relative, but I think I'd discuss the situation with my boss if I were you. It's a relatively small amount, and perhaps the company would be willing to work out a payment plan with your relative as a favor to you. Not including it with the rest of the delinquent accounts is unethical because you owe a fiduciary duty to your company. You could get fired if they find out.

Answer 3

I have run into this issue, as I have had to call on close friends that were delinquent. This is what I did. I explained the friendship with an associate of mine and had him make the call. The debt is not going to go away for the debtor...so someone needs to take action. You can't blame the collector either; they will need to face their relative for years to come. So, the best solution is to pass the account off to someone else or write a letter to the debtor/relative with someone else's signature on it, requesting full payment.

Answer 4

it is unethical. as the book keeper, it is your responsibility to do your job even if that means turning in a relative who is past due. the relative used the service or product from the company you work for and owes them money for it. you could look at it like the relative not paying is like taking money out of YOUR pocket. think you are going to get a raise if the boss finds that you have hidden that? think you are going to get a raise if the company starts to lose money based on all these different accounts.?

Answer 5

Chances are that every person on that list of delinquent accounts is having financial problems, otherwise they would have paid their bill. If I was the owner/manager of the company, the bookkeeper would be reprimanded.

Answer 6

Sell the account to a collection agent if you have made all reasonable attempts to collect. Or, (assuming <$5000), Small Claims Court - although this does have some serious drawbacks, since YOU have to enforce the ruling. Also, you can (and should) report the person/company to the assorted Credit Bureaus for failure to pay. Finally, if it is a seizable asset, hire a repossession team.

Answer 7

WRONG!
If you see it is the acct of a relative go to your supervisor and tell him,"this is my uncle (whatever) and I don't want to be the person who reports him to the credit bureau.
You could explain the circumstances.Then, get away from it.
Then, you're not the bad guy. And you id not compromise your job.