A business cannot sustain growth without cash flow. An accounting system’s primary use makes and manages the incomes and invoices that the company receives every month. This process becomes a thorough search to identify and the money earned through multiple readings. Although this process does not necessarily need a long time to determine, you can rest easy knowing that there are no discrepancies regarding the company’s cash flow.

One aspect that every business will one day experience is none other than dispute management. Disputed invoices would mean that the business would place customer and client payments on hold until there is a resolution. There are numerous ways accounts receivable can handle the dispute resolution process. The main goal of this entire endeavour is to ensure that the payment still finds a way to go through despite the initial dispute. Preventing dispute invoices is always a better solution rather than needing to undergo dispute resolution.

Construction industries are some of the most common businesses to suffer from an invoice dispute. More often than not, construction companies only move to the next face after receiving payment. You can find that some businesses can experience delays should there be some invoice disputes. Learning the three types of conflicts in the construction industry can help prevent dispute tickets from piling up and ensure those customer relationships remain unstrained throughout the entire construction process.

Here are three of the most critical types of invoice disputes in the industry:

Money management would always require an intensive tracking system. There is no point in dealing with finances without proper customer satisfaction as the client can determine the project’s value does not match your company’s price offer. In most cases, it is better not to involve lawyers in this type of dispute. A quick open discussion of the pricing and a transparent list of all the required fees upfront can make this entire endeavour disappear before it even starts to form.

Note that it is always best to place the agreed-upon pricing with your accounts receivable departments to prevent any unnecessary issues with the final service billed. Payment plans, including instalments and down payments, should always be recorded for safety and security reasons.

Although financing a construction project is not something you can expect to cut costs without consequences, your client would always ensure that every cent spent would go into something that the site needs. Additional payments to prevent risk in processes and delivery of goods are all part of the challenges that a business would need to account for before making a final invoice. As such, it is your responsibility that the quality of the materials and items that your client spends on goes towards something that they can deem as structurally sound.

A quality dispute can arise when the material or delivery of said materials arrives in a condition that the client might deem as unusable. Your experience with quality disputes can differ depending on the client in question. However, it is always safe to assume that a dispute case may form when your business tries to use materials for a construction project that do not meet your client’s standards.

Faulty materials would involve making an additional purchase that the client can suffer through as a form of double billing. Additionally, your client may request an official order invoice to ensure every material spent has careful planning without having too much material in stock.

A construction company would still need to have all the necessary paperwork and departments to function as a legitimate business. Behind the scenes of all the constructions and hard labour, there should always be multiple departments, including a finance department, running the numbers and documentation for proper credit management.

Missing documents or even failing to mention a single specific line in documentation can lead to legal action taken against your business. Whenever possible, you should account for every billing requirement. Despite the time-consuming work and additional information of resolving administrative disputes, you can rest assured that this matter has a great deal of importance to the overall dispute management process.

A financial head can resolve any billing matters through negotiations and assurance that the payment method will be enough to make up for the lack of documentation. In some cases, you may need to provide a letter of guarantee- a document that promises payment if either party, in this case, does not meet certain conditions.

Although it is essential to mention that every dispute management process should keep track of any possible issue that could affect project time or delivery dates, administrative disputes come with additional stress. They do not directly relate to material goods traded back and forth between yourself as a business and your clients.

A formal argument or complaint can lead to multiple disputes that will primarily affect the entire construction process in its entirety. Although you can always sit down and discuss the various solutions present with your client, there are particular cases where things can escalate to the degree that you need help to resolve disputes effectively. After all, the central aspect of a business is to conduct business consistently. Once you lose your racks up an overdue invoice, your business will start to lose its reputation and income rapidly.

Fortunately, this guide can help make the issue of handling a dispute easier to comprehend and control. Here are some of the go-to solutions that you can partake in to help the dispute resolution processes flow smoothly.

You always want your customers to feel as though they have a safe space to voice out all of their concerns. This environment ensures that you can receive all possible issues and claims without immediately needing to head to court. An analyst or AR team can help write and log all the dispute cases for your dedicated accounts or finance department.

This filing process also helps keep track of which invoices your client would not make payments for until the matter resolves itself. As such, you can always keep a strong sense of your finances without needing to worry about heading into lousy debt due to revenue leakage.

You can also expect that importance-based research shows that you can determine which issues need resolving quickly while also preventing redundant tasks from occurring. However, it is always best to keep separate accounts open for different stakeholders to ensure that no mistake can occur during the entire invoice dispute management process.

A well-written official contract can help determine if either party violates a section of the agreed-upon document for easy resolution. However, there is always a balance between researching data and finding if the purchase order comes through precisely as ordered. This aspect can either improve the speed of solving the dispute or drastically delay operations depending on the AR analyst’s skill in data management.

Evidence and data necessary for the investigation are essential from the proof of delivery, the bill of lading, receipts, and even the materials’ practices. Each data will need to match perfectly with all other accounts to determine any discrepancies or a human error involved.

Once the cause of the dispute has been addressed and discovered, AR teams can start deliberating amongst themselves to develop a suitable solution. This process can boil down to a simple case of negotiation. It is in both parties interest to prevent a cost-intensive solution when dealing with making contact with one another to settle the problem. As such, this aspect of communication can vary drastically depending on the severity of the problem and litigation.