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Definition · AP/AR

Accounts receivable

Accounts receivable represents amounts customers owe a company for goods and services delivered but not yet collected. For accounts receivable, the useful boundary is the source cash view, timing horizon, owner, liquidity exposure, and operating decision before payment timing, runway, or financing options change.

Also known as AR, trade receivables, receivables

Written by Pluvo TeamReviewed by Pluvo Team
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Why it matters

Understanding accounts receivable matters because cash decisions are time-sensitive. Teams need to know when money moves, which balance changes, who owns the next action, and what can still be changed before liquidity tightens. Pluvo tracks AR with DSO, overdue balances, and aging by customer, tracing each balance back to the open invoices behind it.

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In practice

  • Liquidity example

    Finance teams use accounts receivable when they need to understand cash timing before a decision is made. A team might compare expected receipts, payroll, vendor payments, and debt obligations to decide what action is needed this week.

  • Pluvo example

    Pluvo tracks AR with DSO, overdue balances, and aging by customer, tracing each balance back to the open invoices behind it.

In practice, teams should define accounts receivable with a clear source, owner, time period, and decision before they use it in reporting, planning, or operating reviews.

Understanding accounts receivable matters because cash decisions are time-sensitive. Teams need to know when money moves, which balance changes, who owns the next action, and what can still be changed before liquidity tightens. Pluvo tracks AR with DSO, overdue balances, and aging by customer, tracing each balance back to the open invoices behind it.

A strong workflow for accounts receivable separates the definition from the action: first agree what the term means, then decide how it is measured, when it changes, and who is accountable for the next step.

Pluvo tracks AR with DSO, overdue balances, and aging by customer, tracing each balance back to the open invoices behind it.

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FAQ

What is accounts receivable?

Accounts receivable represents amounts customers owe a company for goods and services delivered but not yet collected. For accounts receivable, the useful boundary is the source cash view, timing horizon, owner, liquidity exposure, and operating decision before payment timing, runway, or financing options change.

How is accounts receivable different from revenue?

The boundary for accounts receivable differs from related terms by scope, source data, time period, and decision use. In this glossary, it covers amounts customers owe a company for goods and services delivered but not yet collected, so teams should compare those boundaries before using it in reporting or planning.

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Sources

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