What a credit controller does, and how to become one

What a credit controller does day to day

A business that sells on credit hands over the goods now and is paid later. The credit controller looks after the money in between, which the books call trade receivables.

Read the aged receivables report, which sorts what customers owe by how old it is, and decide who to chase first.
Send statements and reminders, then phone or write to each customer whose invoice is overdue.
Write down what the customer said and the day they promised to pay.
Match money received to the invoices it pays, using the remittance advice.
Sort out queries: a wrong price, goods that did not arrive, a credit note that was promised.
Look at a new customer before the business gives it credit, and suggest a limit.
Tell the manager about a debt that may never be paid.
Agree the total of the customer accounts to the sales ledger control account at the month end.

The job is part bookkeeping and part talking to people. A customer who has not paid may have a fair complaint, and finding that out is part of the work.

The skills the job uses

Each skill below is practised in a named part of Ledger Drill. A path is a subject, and a module is one part of a path.

The documents: An invoice, a credit note, a statement of account and a remittance advice: what each one says and what it changes. The module Business documents, in the path Business documents and transactions.
A customer's account: Reading the account, reading an aged receivables report and the order of a routine for chasing a late payer. The module Customers and suppliers, in the same path.
Posting to customers: How an invoice and a credit note reach each customer's account. The module Sales day books.
Payment terms and discounts: What a prompt payment discount is and when a customer has earned it. The module Invoices and discounts.
The control account: One account holds the total owed by every credit customer, and it has to agree with the list of balances. The module Control accounts, in the path Bookkeeping foundations.
A debt that will not be paid: The journal that writes it off, and the allowance for doubtful debts. The modules The journal, in the path Journals, errors and control accounts, and Irrecoverable debts, in the path Year-end adjustments.
Measuring the result: How long customers take to pay, as a number of days. The module The working capital cycle, in the path Reading the numbers.
Spreadsheets: Counting the days between two dates and flagging an overdue invoice. The modules Dates and text and Making decisions, in the path Spreadsheets for the office.

The other half of the job is how you speak and write: firm, polite and exact about the invoice and the amount.

How the work shows in the books

A sale on credit is a debit to trade receivables. The customer now owes the business.

A payment from the customer is a credit to trade receivables, and so is a credit note. Each one brings down what the customer owes.

A debt that is written off is also a credit to trade receivables. The debit goes to an expense, because the business has lost that money.

A credit controller who can read these entries can explain any balance on a customer's account, line by line.

The usual routes in

Each employer decides what it asks for. These are the usual ways in, in no order.

Start as an accounts assistant or a sales ledger clerk, and move to credit control from there.
Move across from customer service or sales administration, where you already deal with customers and their orders.
Apply for a junior credit control post. Some adverts train a beginner.
Study alongside the job. There are qualifications in credit management as well as in bookkeeping. AAT and ICB are two bodies that award bookkeeping qualifications in the UK. Each body's own website has what is current.

No route promises a job, and this page does not say how long any of them takes.

What employers ask to see

Read current job adverts for your area. They say what employers want now.

Experience of chasing payment by phone and in writing.
The size of the sales ledger you have looked after, and the kind of customer: businesses or the public.
Sales ledger tasks: matching receipts to invoices, statements, credit notes, reconciling accounts.
The accounting software the firm uses, and a working level in spreadsheets.
A calm manner. An interviewer may ask how you would deal with a customer who will not pay.

This page gives no pay figures. Pay depends on the area, the employer and your experience, and any figure here would soon be out of date. Current job adverts show it.

How to practise the skills on Ledger Drill

Start with the documents: a statement, a remittance advice and a credit note. Then read an aged receivables report and put a chasing routine in order.

Each room is a few lines of reading, then questions you answer in the books, and every answer is marked at once.

Ledger Drill does not award a qualification, and it is not affiliated with any awarding body. It practises the bookkeeping side of the job. It cannot practise a phone call.

Practise it

Module, 5 rooms, all freeBusiness documents

Module, 5 rooms, PremiumCustomers and suppliers

Module, 5 rooms, PremiumSales day books

Module, 5 rooms, PremiumInvoices and discounts

Module, 2 rooms, PremiumControl accounts

Module, 5 rooms, all freeThe journal

Module, 5 rooms, PremiumIrrecoverable debts

Module, 5 rooms, PremiumThe working capital cycle

Module, 5 rooms, PremiumDates and text

Module, 5 rooms, PremiumMaking decisions

Practise it nowHow to read a statement of account

Words used here

Trade receivables: Trade receivables is the money that customers owe a business for sales made on credit. It is an asset.
Sales ledger: The sales ledger holds one account for each credit customer. It shows who owes the business money, and how much.
Statement of account: A statement of account lists the invoices, credit notes and payments between a seller and one customer, and the balance owed.
Remittance advice: A remittance advice is sent by a customer with a payment. It lists the invoices and credit notes the payment covers.
Credit note: A credit note reduces what a customer owes. It is the opposite of an invoice.
Control account: A control account holds one total in the general ledger, such as the amount owed by all the credit customers together.

Questions

What is an aged receivables report?

A list of what each customer owes, split by how old each unpaid invoice is. It shows what is overdue and who to chase first.

Do I need bookkeeping to be a credit controller?

You need the part that deals with customers: invoices, credit notes, receipts, customer accounts and the sales ledger control account. The job does not include preparing year-end accounts.

Is credit control the same as debt collection?

No. A credit controller works inside a business and looks after its own customers' accounts from the day credit is given. Debt collection is the recovery of debts that are already long overdue.

How much does a credit controller earn?

This page gives no figures, because pay depends on the area, the employer and your experience, and figures go out of date. Current job adverts for your area are the best guide.