CCP CRM & AR Automation 4

Question 1

What does 'best possible DSO' (BPDSO) measure?

Accepted Answer

The DSO achievable if all current receivables were collected immediately

Answer

BPDSO represents the theoretical minimum DSO if only current (not past-due) receivables existed, serving as a benchmark for collection efficiency.

Question 2

In a CRM system, what is a 'customer hierarchy' and why is it important for credit management?

Accepted Answer

A parent-child account structure that enables consolidated credit limit management across related entities

Answer

Customer hierarchies link subsidiaries to parent companies, allowing credit managers to set aggregate limits and assess total exposure across a corporate family.

Question 3

Which AR metric specifically tracks invoices that are disputed and therefore cannot be collected until resolved?

Accepted Answer

Disputed AR percentage or dispute rate

Answer

Disputed AR percentage isolates invoices under formal dispute from the collectible AR pool, giving management visibility into unresolvable aging.

Question 4

What is 'lockbox' processing in the context of AR automation?

Accepted Answer

A bank service that intercepts, processes, and deposits customer payments, then transmits remittance data to the company's AR system

Answer

Lockbox services accelerate cash application by having the bank handle physical checks and electronically forward payment and remittance data directly to AR.

Question 5

When an AR automation system detects a duplicate invoice, what is the recommended automated response?

Accepted Answer

Flag it for review and suppress it from the dunning workflow pending resolution

Answer

Flagging and suppressing a potential duplicate prevents erroneous collection activity while allowing a human reviewer to confirm and void or merge the record.

(CCP) Certified Credit Professional Practice Test

(CCP) Certified Credit Professional Practice Test

CCP CRM & AR Automation 4