[{"data":1,"prerenderedAt":497},["ShallowReactive",2],{"document-credit-policy-D12633":3},{"document":4,"label":23,"preview":11,"thumb":24,"thumb600":25,"description":5,"descriptionCustom":6,"apiDescription":5,"pages":8,"extension":10,"parents":26,"breadcrumb":30,"related":38,"customDescModule":176,"customdescription":6,"mdFm":177,"mdProseHtml":496},{"description":5,"descriptionCustom":6,"label":7,"pages":8,"size":9,"extension":10,"preview":11,"thumb":12,"svgFrame":13,"seoMetadata":14,"parents":16,"keywords":15},"CREDIT POLICY OVERVIEW Cash flow and liquidity management is of paramount importance for [COMPANY NAME]. This credit policy has been designed to maximize profits and profits on sales revenue while minimizing exposure to slow-paying customers and business losses, thereby ensuring a healthy cash and working capital position. SCOPE This policy applies to all sales of [COMPANY NAME] products to customers. All departments within [COMPANY NAME] responsible for the sale, marketing, contract approval, order acceptance; scheduling and shipment of products must adhere to the policy and guidelines below. TERMS OF SALE The terms and conditions of sale are determined on the basis of current sales programs and promotions. The credit department works closely with the sales department to establish and modify appropriate conditions that maximize sales results. Standard payment terms are: net 30; net 45 for sales greater than [SPECIFY], or four equal quarterly payments due on days 1, 90, 180, and 270. Terms for orders already shipped cannot be altered or modified without approval from the credit department. Any changes from standard payment terms requires a variance request form. CREDIT RISK MANAGEMENT In the context of this policy, some receivables may not be recovered as expected. The method of assessing risk and determining a credit limit to customers varies depending on the amount of credit requested and the type of product or service sold. Low credit limits, generally described as accounts with a credit limit of up to $ [SPECIFY] or the equivalent in local currency, represent a reduced exposure and generally require limited information to assign a credit limit. Larger limits require higher levels of risk analysis and may use risk scoring models using internal and external risk elements and methodology. Limits can also be determined based on the payment experience of customers as well as annual sales and payment terms to arrive at a risk-adjusted limit that considers normal customer purchasing activities. For credit limits exceeding the maximum amounts defined in this policy (or in the absence of commonly available risk elements), further financial analysis is required. This analysis will include (but is not limited to) the analysis of financial statement ratios, cash flow analysis, evaluation of the availability of external financing and evaluation of future activities by the company's management. Typical minimum components of risk assessment include: Demographic assessment; Payment history (especially at comparable exposure levels).; Length of time in business; Business reputation (absence of adverse public information, i.e. court cases, judgments, etc); Knowledgeable assessment of company management; Financial analysis i.e. analysis of historical financial data, company accounts (based upon anticipated credit limit); External credit risk rating; Business analysis i.e. the situation of the economic sector the customer is in and their market position within it; Adequacy and enforceability of collateral/guarantee where applicable. ROLE AND RESPONSIBILITIES In order to facilitate the flow of orders and the shipment of products, [COMPANY NAME]'s policy is that credit should be extended to all customers who demonstrate both the ability to pay and a history of timely debt payment. Credit limits will be determined by comparing the following averages: the customer's working capital, the average credit limits granted by the trade references and the customer's credit line needs. Credit department - The credit department will outline the requirements for establishing trade credit for new customers and maintaining lines of credit and limits for active accounts and returning customers with appropriate payment terms. The VP Credit has overall credit and collections responsibility for the credit department. Employees in these roles have authority to approve credit lines up to $[SPECIFY]. Anything exceeding this amount needs approval from the VP Credit. The credit department will evaluate all new customers to determine the terms and methods of payment that will be required and the level of credit that will be established. The credit department will also seek to offer optional payment methods to facilitate sales to customers with sub-optimal credit histories. Credit department will periodically review and reassess the payment terms and lines of credit of existing customers to meet new customer requirements and manage risks as financial and business conditions change. The credit managers are responsible for managing the credit evaluation, review, and approval process, as well as managing overall risk to the portfolio. Only credit managers are authorized to issue communications with customers concerning credit-related issues. Sales department - The sales department is responsible for ensuring that the credit application form is submitted to the credit department by a prospective new customer, in advance of order acceptance. The sales representative also is responsible for instructing the customer regarding the respective roles and requirements of the credit, order administration and sales departments for introducing the customer to the appropriate representative of these departments. Accounts receivable - This position/team reports to the credit manager and is responsible for daily accounts receivable activity, including invoicing and cash posting. Collections manager - This position/team oversees collections and works with contracted collections agencies. CUSTOMER CREDIT REVIEWS The process involves assessing a customer's ability and willingness to pay under the terms of sale and the likelihood of late or defaulted payment. The credit limit is a measure of the customer's creditworthiness and is based on the ability to pay amounts due on time. For existing customers, the credit department reviews credit limits as needed. All limits may be modified according to the evolution of the customer's creditworthiness. Customer credit limits and payment terms must be recorded in the operational and financial systems that are linked to the accounting systems that manage the activities of customer accounts. Any adverse changes to the customer's creditworthiness or risk rating will trigger a review of the customer credit limit in accordance with the guidelines set in this policy. The credit analysis will: Determine amount of credit needed based on estimated purchases (including seasonality) and proposed payment terms provided by country. Review customer risk analysis (credit report or manual assessment). Assess business analytical information. The end result is the determination of a credit limit for that customer consistent with the risk assessment, expected purchase levels, and payment terms Customer accounts must be forwarded to the credit department when an account exceeds its credit limit and/or the customer is in arrears and every effort has been made to obtain a payment",null,"Credit Policy","6",513,"doc","https://templates.business-in-a-box.com/imgs/1000px/credit-policy-D12633.png","https://templates.business-in-a-box.com/imgs/250px/12633.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12633.xml",{"title":15,"description":6},"credit policy",[17,20],{"label":18,"url":19},"Human Resources","/templates/human-resources/",{"label":21,"url":22},"Company Policies","/templates/company-policies/","Credit Policy Template","https://templates.business-in-a-box.com/imgs/400px/12633.png","https://templates.business-in-a-box.com/imgs/600px/12633.png",[27,17,20],{"label":28,"url":29},"Templates","/templates/",[31,32,35],{"label":28,"url":29},{"label":33,"url":34},"Finance & Accounting","/templates/finance-accounting/",{"label":36,"url":37},"Credit Management","/templates/credit-management/",[39,43,47,51,55,59,63,67,71,75,79,83,87,104,118,131,146,159],{"label":40,"url":41,"thumb":42,"extension":10},"Credit Note","/template/credit-note-D13639","https://templates.business-in-a-box.com/imgs/250px/13639.png",{"label":44,"url":45,"thumb":46,"extension":10},"Loan Policy","/template/loan-policy-D13274","https://templates.business-in-a-box.com/imgs/250px/13274.png",{"label":48,"url":49,"thumb":50,"extension":10},"Promissory Note Line of Credit","/template/promissory-note-line-of-credit-D435","https://templates.business-in-a-box.com/imgs/250px/435.png",{"label":52,"url":53,"thumb":54,"extension":10},"Promissory Note","/template/promissory-note-D434","https://templates.business-in-a-box.com/imgs/250px/434.png",{"label":56,"url":57,"thumb":58,"extension":10},"Promissory Note With Acknowledgment","/template/promissory-note-with-acknowledgment-D437","https://templates.business-in-a-box.com/imgs/250px/437.png",{"label":60,"url":61,"thumb":62,"extension":10},"Collection Letter_Following Promissory Note","/template/collection-letter_following-promissory-note-D196","https://templates.business-in-a-box.com/imgs/250px/196.png",{"label":64,"url":65,"thumb":66,"extension":10},"Demand to Pay Promissory Note","/template/demand-to-pay-promissory-note-D207","https://templates.business-in-a-box.com/imgs/250px/207.png",{"label":68,"url":69,"thumb":70,"extension":10},"Letter of Default on Promissory Note","/template/letter-of-default-on-promissory-note-D431","https://templates.business-in-a-box.com/imgs/250px/431.png",{"label":72,"url":73,"thumb":74,"extension":10},"Movable Hypothec Promissory Note","/template/movable-hypothec-promissory-note-D432","https://templates.business-in-a-box.com/imgs/250px/432.png",{"label":76,"url":77,"thumb":78,"extension":10},"Promissory Note With Acceleration Clause","/template/promissory-note-with-acceleration-clause-D436","https://templates.business-in-a-box.com/imgs/250px/436.png",{"label":80,"url":81,"thumb":82,"extension":10},"Guarantee of Claim Promissory Note","/template/guarantee-of-claim-promissory-note-D884","https://templates.business-in-a-box.com/imgs/250px/884.png",{"label":84,"url":85,"thumb":86,"extension":10},"Security Agreement and Promissory Note","/template/security-agreement-and-promissory-note-D912","https://templates.business-in-a-box.com/imgs/250px/912.png",{"description":88,"descriptionCustom":6,"label":89,"pages":90,"size":9,"extension":10,"preview":91,"thumb":92,"svgFrame":93,"seoMetadata":94,"parents":96,"keywords":102,"url":103},"[DATE] [CONTACT NAME] [ADDRESS] [ADDRESS 2] [CITY, STATE/PROVINCE] [ZIP/POSTAL CODE] SUBJECT: demand for extension of payment date Dear [Contact name], This will acknowledge our telephone conversation of this date. As was stated in our letter dated [Date], we should be receiving our financing by [Date].","Demand for Extension of Payment Date","1","https://templates.business-in-a-box.com/imgs/1000px/demand-for-extension-of-payment-date-D444.png","https://templates.business-in-a-box.com/imgs/250px/444.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#444.xml",{"title":95,"description":6},"demand for extension of payment date",[97,99],{"label":33,"url":98},"finance-accounting",{"label":100,"url":101},"Administration","business-administration","demand for extension payment date","/template/demand-for-extension-of-payment-date-D444",{"description":105,"descriptionCustom":6,"label":106,"pages":90,"size":9,"extension":10,"preview":107,"thumb":108,"svgFrame":109,"seoMetadata":110,"parents":112,"keywords":111,"url":117},"Payment Plan Agreement By this contract, [BORROWER'S NAME] agrees to pay for the services rendered by [NAME OF THE LENDER], hereafter known as \"Lender,\" by the following schedule in exchange for [SPECIFY]. By this agreement, it is agreed that a payment of [SPECIFY AMOUNT] will be surrendered to the Lender every [WEEK/MONTH], for the next [SPECIFY THE NUMBER OF WEEKS/MONTHS] until the total of the payment required, which is [SPECIFY] has been delivered. The first payment will start [SPECIFY DATE] and will end [SPECIFY DATE]. The payment schedule will take the following form:","Payment Plan Agreement","https://templates.business-in-a-box.com/imgs/1000px/payment-plan-agreement-D12663.png","https://templates.business-in-a-box.com/imgs/250px/12663.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12663.xml",{"title":111,"description":6},"payment plan agreement",[113,116],{"label":114,"url":115},"Legal Agreements","business-legal-agreements",{"label":114,"url":115},"/template/payment-plan-agreement-D12663",{"description":119,"descriptionCustom":6,"label":120,"pages":8,"size":9,"extension":10,"preview":121,"thumb":122,"svgFrame":123,"seoMetadata":124,"parents":126,"keywords":129,"url":130},"SERVICE AGREEMENT This SERVICE AGREEMENT (\"Agreement\") is effective [DATE], BETWEEN: [COMPANY NAME] (the \"Contractor\"), a company organized and existing under the laws of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] AND: [COMPANY NAME] (the \"Customer\"), a company organized and existing under the laws of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] (The Contractor and the Customer shall be individually referred to as a \"Party\" and collectively referred to as the \"Parties\", as the context may require). WHEREAS A. Contractor has experience and expertise in [DESCRIBE EXPERIENCE AND SERVICE]. B. Customer desires to have Contractor provide services for them. C. Contractor desires to provide services to Customer on the terms and conditions set forth herein (the \"Services\"). NOW THEREFORE, in consideration of the above recitals, the representations, warranties, and agreements contained in this Agreement and for other good and valuable consideration, the receipt and adequacy of which are now acknowledged, the Parties agree as follows: SERVICES PROVIDED Beginning on upon agreement to this contract, [CONTRACTOR] will provide to [CUSTOMER] the following service (collectively, the /Services\"): Description of the project: [DESCRIBE THE SERVICE REQUIRED]. SCOPE OF WORK Contractor agrees to provide Services pursuant to the Scope of Work set forth in Exhibit A attached hereto (the \"Scope of Work\"). TERM Unless both parties mutually agree on an extension, this contract will automatically terminate on [SPECIFY]. PERFORMANCE The parties agree to do everything possible to ensure that the terms of this Agreement take effect. PAYMENT FOR SERVICES In exchange for the Services rendered, a payment of [SPECIFY] will be made to the Contractor upon completion of the scheduled Services described in this Contract. If an invoice is not paid on the due date, interest will be added to the current balance. These amounts shall be payable, and the Customer shall pay all overdue amounts at the lesser of [SPECIFY] per cent per annum or the maximum percentage permitted by applicable law. Or Customer will pay Contractor as follows: [SPECIFY]. DELIVERY OF SERVICES The Contractor will exercise due diligence in the provision of services. However, the Customer acknowledges that the indicated delivery times and other payment milestones listed in Scope of Work are estimates and do not constitute final delivery dates. SECURITY The Contractor must make reasonable security arrangement to protect Material from unauthorized access, collection, use, alteration or disposal. OWNERSHIP RIGHT The Customer shall hold the copyright for the agreed version of the Services as delivered, and the Customer's copyright notice may be displayed in the final version. All works, ideas, discoveries, inventions, patents, products or other information that may be protected by copyright (collectively, the \"Work Product\" developed in whole or in part by the Contractor in connection with the Services, shall be the exclusive property of the Customer. Upon request, the Contractor shall execute all documents necessary to confirm or perfect the exclusive ownership of the Customer's \"Work Product\". The Contractor retains exclusive rights to pre-existing materials used in the Customer's projects. The Customer shall not have the right to reuse, resell or otherwise transfer material belonging to the contractor or third parties. The Contractor reserves the right to use the finished public product as an example of a product. RETURN OF PROPERTY Upon the expiry or termination of this Agreement, the Contractor will return to the Customer any property, documentation, records or Confidential Information which is the property of the Customer. COMPENSATION For all services rendered by the Contractor under this Agreement, the Customer shall indemnify the Contractor. In the event that the Customer fails to make any of the payments mentioned, the Contractor shall have the right, but shall not be obliged, to exercise any of the following remedies: ","Service Agreement","https://templates.business-in-a-box.com/imgs/1000px/service-agreement-D12711.png","https://templates.business-in-a-box.com/imgs/250px/12711.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12711.xml",{"title":125,"description":6},"service agreement",[127,128],{"label":114,"url":115},{"label":114,"url":115},"sales agreement","/template/sales-agreement-D12711",{"description":132,"descriptionCustom":6,"label":133,"pages":134,"size":9,"extension":10,"preview":135,"thumb":136,"svgFrame":137,"seoMetadata":138,"parents":140,"keywords":139,"url":145},"EXPENSE POLICY PURPOSE The purpose of this Expense Policy is to establish guidelines, procedures, and controls for the management and reimbursement of business expenses incurred by employees and authorized individuals on behalf of [COMPANY NAME]. This Policy aims to ensure prudent financial management, compliance with tax regulations, and consistency in expense reporting. SCOPE This Policy applies to all employees, contractors, vendors, and authorized individuals who incur business-related expenses while conducting activities on behalf of [COMPANY NAME]. It covers all types of expenses, including but not limited to travel, meals, entertainment, supplies, and miscellaneous business expenses. POLICY STATEMENTS Authorization and Eligibility Authorized Expenses: [COMPANY NAME] will reimburse only those expenses that are directly related to business activities and are consistent with the company's mission and objectives. Eligible Individuals: Only employees, contractors, vendors, and authorized individuals with prior authorization may incur and seek reimbursement for business expenses. Authorization should be obtained in advance whenever possible. Expense Approvals: Expenses must be approved by the appropriate supervisor or manager before they are incurred. The approval process should include a review of the expense's necessity and compliance with this Policy. Expense Categories Travel Expenses: Travel expenses, including transportation, accommodation, and meals, must be reasonable, necessary, and consistent with company travel policies. Meal Expenses: Meal expenses incurred during business activities should be moderate, justifiable, and in accordance with company meal policies. Entertainment Expenses: Entertainment expenses should be directly related to business discussions and should comply with company entertainment policies. Supplies and Miscellaneous Expenses: Expenses for supplies and other miscellaneous items must be reasonable, necessary, and related to the individual's job responsibilities. Documentation and Record Keeping Receipts and Documentation: Individuals incurring expenses must retain original receipts, invoices, and supporting documentation for all expenses submitted for reimbursement. Electronic copies of receipts are acceptable.","Expense Policy","3","https://templates.business-in-a-box.com/imgs/1000px/expense-policy-D13687.png","https://templates.business-in-a-box.com/imgs/250px/13687.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#13687.xml",{"title":139,"description":6},"expense policy",[141,143],{"label":18,"url":142},"human-resources",{"label":21,"url":144},"company-policies","/template/expense-policy-D13687",{"description":147,"descriptionCustom":6,"label":148,"pages":149,"size":9,"extension":10,"preview":150,"thumb":151,"svgFrame":152,"seoMetadata":153,"parents":155,"keywords":154,"url":158},"MASTER SERVICE AGREEMENT This Master Service Agreement (\"Agreement\") is made and effective this [Date], BETWEEN: [YOUR COMPANY NAME],\" PARTY A\", a corporation organized and existing under the laws of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [COMPANY NAME],\" PARTY B\", a corporation organized and existing under the laws of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] SCOPE OF SERVICES [PARTY A] shall provide [PARTY B] with the services and products described in the Statements of Work. The SOW must describe the respective contribution and services of each party. Any services provided by either party under this Agreement are referred to as the \"Services\". For the purposes of this Agreement, the party engaged to perform the Services, [PARTY A], is the \"Performing Party\" and the party for whom the Services are to be performed, [PARTY B], is the \" Engaging Party\". All SOWs that are negotiated between the parties shall be in writing and executed by both parties and shall be attached hereto as supplemental Exhibits, and shall be incorporated into, and governed by, this Agreement. STATEMENT OF WORK (SOW) Contents of Statements of Work The parties shall describe each individual deliverable to be provided under this agreement in its own statement of work (each, a \"Statement of Work\"), each one including a complete description of the deliverable provided under the Statement of Work, the number of [PARTY A] personnel who will be assigned to provide the deliverable in question, key [PARTY A] personnel the parties agree are essential to the provision of the particular deliverable (shall not exceed [SPECIFY] percent of the total personnel assigned to this Statement of Work) (each one a \"Key Personnel\"), the applicable fees and fee schedule, including any milestones and milestone payments if applicable, for the particular deliverable, the service levels and acceptance criteria for the particular deliverable, any materials the parties will provide for the particular deliverable, a timeline for providing the particular deliverable, and a unique identification number for the Statement of Work and explicit reference to this agreement. Integration. A Statement of Work signed by both parties, bearing a unique identification number and making explicit reference to this Agreement, shall be deemed to form an integral part of this Agreement. Severable. The parties may terminate any individual Statement of Work without affecting the rest of the agreement or any other Statement of Work. Conflict of Terms. If there is a conflict between the terms of this agreement and any Statement of Work, the Statement of Work shall apply. Changes to Statements of Work Proposing Changes. Either party may propose amendments to the Statement of Work deliverable, fees or schedule by giving written notice to the other party. Finalizing Changes. If the parties agree to change the deliverable, fees, or schedule of a Statement of Work they parties shall cooperate to execute a written amendment to the relevant Statement of Work detailing the changes. Additional Statements of Work Request Additional Services. [PARTY B] may request additional services by sending a written notice to [PARTY A] reasonably detailing the services requested. Assess the Request. Immediately after receiving a request for additional services from [PARTY B], [PARTY A] shall evaluate the request to determine whether there are circumstances preventing it from providing the requested services and, if there are no circumstances preventing it from providing the requested services, shall provide [PARTY A] with the estimated fees and timelines for such requested services. Execute New Statement of Work. If after receiving [PARTY A] 's estimates [PARTY B] still wants the requested services, the parties shall execute a new Statement of Work according to the requirements of paragraph CONTENT OF STATEMENTS OF WORK. Acceptance and Rejection Inspection Period. [PARTY B] shall have an \"Inspection period\" of [NUMBER] working days after [PARTY A] has provided the deliverable to review and verify that the deliverable meets the acceptance criteria as set out in the applicable Statement of Work (the \"Inspection Period\"). Acceptance. If in [PARTY B] 's opinion the deliverable meets the acceptance criteria, [PARTY B] must accept the deliverable and notify [PARTY A] that it is accepting the deliverable. Deemed Acceptance.[PARTY B] shall be deemed to have accepted the deliverable if [PARTY B] fails to notify [PARTY A] by the end of the inspection period, or if, during the inspection period, [PARTY B] uses or attempts to use the deliverable beyond what is necessary for the inspection and testing, in a manner that a reasonable person would consider compatible with [PARTY B] having accepted deliverable from [PARTY A]. Rejection. If in [PARTY B]'s opinion, the deliverable does not materially meet the acceptance criteria, [PARTY B] may reject the deliverable by delivering to [PARTY B] a written list detailing each failure to satisfy the acceptance criteria. TERM The term of this Agreement begins on [INSERT START DATE] and continues until such time as the Deliverables have been provided to the Purchaser in accordance with this Agreement or until such time as this Agreement is terminated by either party in accordance with its terms. BUDGET AND PAYMENT DEADLINE The budget and payment deadline will be defined in each SOW. Unless otherwise provided in this SOW, uncontested invoices are payable within 30 calendar days of receipt of the invoice. Payment is made as follows: [SPECIFY]. INDEPENDENT CONTRACTOR The relationship between [PARTY A] and [PARTY B] shall, within the context of the SOW, be that of an independent contractor, and nothing in this Agreement should be construed to create a partnership, joint venture, or employer-employee relationship. Each Party shall, at all times during the term of this Agreement, perform the duties and responsibilities herein without any control by the other Party. Either Party may realize a profit or loss in connection with performing the services. Either Party may render similar services for the benefit of others. Neither Party is an agent of the other Party and is not authorized to make any representation, contract, or contract commitment on behalf of the other Party. DELIVERABLES The Supplier shall provide the goods and/or services described in the Statement of Work (attached) of this Master Service Agreement. CONFIDENTIALITY Information shall be treated as confidential during the term of this Agreement and for a period of seven (7) years thereafter. During such period, the parties will not: (a) disclose the Confidential Information of the Disclosing Party to any third party, using at least the same degree of care as it uses to protect its own confidential information, but not less than reasonable care or (b) use such information for any purpose other than to perform its obligations under this Agreement. Confidential Information does not include information which has previously been made generally available to the public, becomes publicly known, without fault on the part of the Receiving Party, subsequent to disclosure by the Disclosing Party of such information to the Receiving Party, is received by the Receiving Party at any time from a source, other than the Disclosing Party, lawfully having possession of and the right to disclose such information, otherwise becomes known by the Receiving Party prior to disclosure by the Disclosing Party to the receiving party of such information, or is independently developed by the Receiving Party without use of such information","Master Service Agreement","7","https://templates.business-in-a-box.com/imgs/1000px/master-service-agreement-D12657.png","https://templates.business-in-a-box.com/imgs/250px/12657.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12657.xml",{"title":154,"description":6},"master service agreement",[156,157],{"label":114,"url":115},{"label":114,"url":115},"/template/master-service-agreement-D12657",{"description":160,"descriptionCustom":6,"label":161,"pages":90,"size":162,"extension":10,"preview":163,"thumb":164,"svgFrame":165,"seoMetadata":166,"parents":167,"keywords":174,"url":175},"COMPANY NAME:_______________________ Address: _______________________________________ City: ______________________________ State/Province: ___________ Zip/postal code__________ Country: ________________ Phone: _________________ Fax: __________________ Email: _________________________________________ Purchase Order The following number must appear on all related correspondence, shipping papers, and invoices: P.O. NUMBER: Contact: Address: _______________________________________ City: ______________________________ State/Province: ___________ Zip/postal code___________ Country: ________________ Phone: _________________ Fax: __________________ Email: _________________________________________ Ship To:","Purchase Order",49,"https://templates.business-in-a-box.com/imgs/1000px/purchase-order-D1411.png","https://templates.business-in-a-box.com/imgs/250px/1411.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#1411.xml",{"title":6,"description":6},[168,171],{"label":169,"url":170},"Sales & Marketing","sales-marketing",{"label":172,"url":173},"Bids & Quotes","bids-quotes","purchase order","/template/purchase-order-D1411",false,{"seo":178,"reviewer":191,"legal_disclaimer":176,"quick_facts":195,"at_a_glance":197,"personas":201,"variants":226,"glossary":252,"sections":286,"how_to_fill":337,"common_mistakes":378,"faqs":403,"industries":431,"comparisons":448,"diy_vs_pro":460,"educational_modules":473,"related_template_ids_curated":476,"schema":484,"classification":486},{"meta_title":179,"meta_description":180,"primary_keyword":181,"secondary_keywords":182},"Credit Policy Template (Free Word)","Free credit policy template covering credit checks, limits, payment terms, dispute handling, dunning, and collections. Used in 190+ countries. Free Word and PDF download.","credit policy template",[183,184,185,186,187,188,189,190],"credit policy for business","customer credit policy template","accounts receivable credit policy","credit policy word template","credit policy example","trade credit policy template","credit management policy","business credit policy free download",{"name":192,"credential":193,"reviewed_date":194},"Bruno Goulet","CEO, Business in a Box","2026-05-02",{"difficulty":196,"legal_review_recommended":176,"signature_required":176},"medium",{"what_it_is":198,"when_you_need_it":199,"whats_inside":200},"A Credit Policy is a written internal document that defines how your company evaluates, approves, and manages trade credit extended to customers. This free Word download covers every stage of the credit lifecycle — from initial credit application through payment terms, dispute resolution, dunning sequences, and write-off authority — in a single editable document you can export as PDF and distribute to your finance and sales teams.\n","Use it when your business sells on invoice to other businesses, when bad-debt write-offs are climbing, or when sales and finance teams disagree on who qualifies for credit and on what terms.\n","Credit application requirements and scoring criteria, tiered credit limits, standard and extended payment terms, overdue-account escalation steps, a dunning sequence with defined timelines, dispute resolution procedures, write-off authority thresholds, and collections referral criteria.\n",[202,206,210,214,218,222],{"title":203,"use_case":204,"icon_asset_id":205},"CFOs and finance directors","Formalizing credit decisions that are currently made ad hoc by multiple people","persona-cfo",{"title":207,"use_case":208,"icon_asset_id":209},"Accounts receivable managers","Enforcing consistent payment terms and escalation steps across the customer base","persona-ar-manager",{"title":211,"use_case":212,"icon_asset_id":213},"Small business owners","Reducing bad debt by establishing credit checks before extending payment terms","persona-small-business-owner",{"title":215,"use_case":216,"icon_asset_id":217},"Sales directors","Defining the credit approval process so reps know what terms they can offer","persona-sales-director",{"title":219,"use_case":220,"icon_asset_id":221},"Operations directors","Aligning order fulfillment with approved credit status to prevent unauthorized shipments","persona-operations-director",{"title":223,"use_case":224,"icon_asset_id":225},"Startup founders","Building a scalable credit framework before accounts receivable becomes unmanageable","persona-startup-founder",[227,231,235,239,243,246,249],{"situation":228,"recommended_template":229,"slug":230},"Formalizing credit terms between a parent company and its subsidiaries","Intercompany Agreement","inter-company-services-agreement-D886",{"situation":232,"recommended_template":233,"slug":234},"Documenting the payment terms agreed in a specific customer sale","Sales Invoice","sales-invoice--excel-D382",{"situation":236,"recommended_template":237,"slug":238},"Setting out the full terms of a recurring supply relationship","Sales Agreement","sales-agreement-D12711",{"situation":240,"recommended_template":241,"slug":242},"Recovering a specific overdue balance through a formal demand","Demand Letter for Payment","demand-for-extension-of-payment-date-D444",{"situation":244,"recommended_template":106,"slug":245},"Offering a customer a structured repayment plan for an overdue account","payment-plan-agreement-D12663",{"situation":247,"recommended_template":148,"slug":248},"Governing the overall terms of an ongoing commercial relationship","master-service-agreement-D12657",{"situation":250,"recommended_template":133,"slug":251},"Setting internal expense and purchasing controls alongside credit controls","expense-policy-D13687",[253,256,259,262,265,268,271,274,277,280,283],{"term":254,"definition":255},"Trade Credit","An arrangement where a seller allows a buyer to receive goods or services and pay at a later date, typically Net 30 to Net 90.",{"term":257,"definition":258},"Credit Limit","The maximum outstanding balance a customer is permitted to carry at any one time under the company's approved credit terms.",{"term":260,"definition":261},"Days Sales Outstanding (DSO)","The average number of days it takes to collect payment after a sale — a key measure of accounts receivable efficiency.",{"term":263,"definition":264},"Dunning","The structured sequence of communications — statements, reminders, calls, and final notices — sent to customers with overdue balances.",{"term":266,"definition":267},"Write-Off","The accounting removal of a receivable that has been determined uncollectable, recognizing it as a bad-debt expense.",{"term":269,"definition":270},"Credit Application","A form completed by a prospective customer requesting trade credit, typically including business details, bank references, and trade references.",{"term":272,"definition":273},"Payment Terms","The agreed conditions under which payment is due — for example, Net 30 means full payment is required within 30 days of the invoice date.",{"term":275,"definition":276},"Aging Report","An accounts receivable report that groups outstanding invoices by age — typically 0–30, 31–60, 61–90, and 90+ days — to prioritize collection activity.",{"term":278,"definition":279},"Collections Referral","The formal transfer of an overdue account to a third-party collections agency or legal counsel when internal recovery attempts have been exhausted.",{"term":281,"definition":282},"Credit Score / Rating","A numerical or letter-grade assessment of a customer's creditworthiness, typically drawn from a commercial credit bureau such as Dun & Bradstreet or Experian.",{"term":284,"definition":285},"Disputed Invoice","An invoice that a customer formally contests, claiming an error in amount, delivery, or quality — triggering a defined resolution process before collection can proceed.",[287,292,297,302,307,312,317,322,327,332],{"name":288,"plain_english":289,"sample_language":290,"common_mistake":291},"Purpose and scope","States why the policy exists, which business units and customer types it applies to, and who is responsible for administering it.","This Credit Policy applies to all trade credit extended by [COMPANY NAME] to business customers in [REGION/DIVISION]. The [FINANCE DIRECTOR / CFO] is responsible for policy administration and annual review.","Scoping the policy only to new customers. Existing customers whose payment behavior has deteriorated represent as much risk as new accounts — and the policy should say how to handle them.",{"name":293,"plain_english":294,"sample_language":295,"common_mistake":296},"Credit application requirements","Defines what documentation a customer must provide before credit is evaluated — including business registration, financial statements, bank references, and trade references.","All customers requesting credit terms must submit a completed Credit Application including: legal entity name and registration number, two bank references, three trade references, most recent two years of financial statements, and a signed personal guarantee for balances exceeding $[THRESHOLD].","Requiring the same documentation from a Fortune 500 account as from a new sole proprietor. Tier your requirements to the requested credit limit so you don't lose large customers over unnecessary friction.",{"name":298,"plain_english":299,"sample_language":300,"common_mistake":301},"Credit evaluation criteria","Sets out the scoring framework used to assess creditworthiness — credit bureau score thresholds, payment history benchmarks, financial ratio targets, and any disqualifying factors.","Credit approval requires a minimum Dun & Bradstreet PAYDEX score of [75], average days-to-pay with trade references of [35] days or fewer, and a current ratio of at least [1.2:1]. Applicants with an active lien, judgment, or bankruptcy within [3] years are automatically declined.","Using a single criterion — typically a credit score alone — to make approval decisions. Customers with acceptable scores can still have poor payment habits visible in trade references.",{"name":303,"plain_english":304,"sample_language":305,"common_mistake":306},"Credit limits and tiers","Establishes how credit limits are set, what approval authority is required at each tier, and when limits can be increased or reduced.","Tier 1: limits up to $[10,000] approved by AR Manager. Tier 2: $[10,001]–$[50,000] approved by Finance Director. Tier 3: above $[50,000] requires CFO approval. Limits are reviewed annually or upon receipt of an updated credit application.","Setting credit limits and never reviewing them. A customer granted $25,000 in Year 1 may have significantly deteriorated financials in Year 3 — annual review triggers catch this before exposure grows.",{"name":308,"plain_english":309,"sample_language":310,"common_mistake":311},"Payment terms","Defines the standard payment terms offered, any early-payment discounts, conditions for extended terms, and currency and invoicing requirements.","Standard terms are Net [30] days from invoice date. A [2]% discount applies to invoices paid within [10] days (2/10 Net 30). Extended terms of Net [60] or Net [90] require Finance Director approval and may require a personal guarantee or security deposit.","Offering extended terms as a sales incentive without documenting the approval — finance teams later have no record of why a customer is on Net 90, and collecting becomes politically difficult.",{"name":313,"plain_english":314,"sample_language":315,"common_mistake":316},"Invoice dispute resolution","Sets a clear process for customers to raise disputes, the timeframe for resolution, and whether disputed amounts are placed on hold during investigation.","Customers must notify [COMPANY NAME] of a disputed invoice in writing within [15] days of the invoice date, specifying the amount in dispute and the reason. [COMPANY NAME] will acknowledge within [5] business days and resolve within [30] days. Undisputed balances on the same account remain due on their original terms.","Putting the entire account on hold when a single invoice is disputed. Customers learn to dispute invoices strategically to delay all payments — only the disputed amount should be suspended.",{"name":318,"plain_english":319,"sample_language":320,"common_mistake":321},"Dunning sequence","Maps the escalating sequence of overdue notices, calls, and holds — with defined timelines at each stage from first reminder through final notice before collections.","Day [1] past due: automated statement. Day [15]: email reminder from AR team. Day [30]: phone call from AR Manager. Day [45]: formal overdue notice, order hold applied. Day [60]: final written demand, account suspended. Day [75]: referral to [collections agency / legal counsel].","Leaving gaps of 30 or more days between dunning steps. Customers prioritize creditors who follow up consistently — a 30-day silence between reminders signals the debt is not being actively managed.",{"name":323,"plain_english":324,"sample_language":325,"common_mistake":326},"Write-off authority and bad-debt procedure","Defines who can authorize a write-off, at what dollar thresholds, what documentation is required, and how the write-off is recorded in the general ledger.","Write-offs up to $[2,500] may be approved by the AR Manager. Write-offs of $[2,501]–$[10,000] require Finance Director approval. Write-offs above $[10,000] require CFO and CEO approval. All write-offs require a completed Bad Debt Write-Off Form and documentation of collection attempts.","Writing off accounts without documenting collection attempts. This creates a tax deduction risk — the IRS and CRA require evidence that the debt was genuinely uncollectable, not simply inconvenient to pursue.",{"name":328,"plain_english":329,"sample_language":330,"common_mistake":331},"Collections referral criteria","States the specific conditions that trigger referral to a third-party collections agency or legal counsel, and who authorizes the referral.","Accounts meeting all of the following criteria shall be referred to [COLLECTIONS AGENCY NAME] by the Finance Director: balance overdue by more than [75] days, minimum balance of $[500], at least [3] documented contact attempts with no payment or payment plan agreed, and no active dispute on file.","Referring accounts to collections without a minimum balance threshold. Collection agency fees (typically 20–40% of recovered amount) make small balances uneconomical to pursue externally.",{"name":333,"plain_english":334,"sample_language":335,"common_mistake":336},"Policy review and exceptions","Establishes when the policy is reviewed, who can grant exceptions to standard terms, and how exceptions must be documented.","This policy is reviewed annually by the CFO and updated as needed. Exceptions to any provision — including extended terms, waived late fees, or credit above standard tier limits — require written approval from the Finance Director and must be logged in the [EXCEPTION REGISTER / CRM SYSTEM].","Allowing exceptions without a written record. Undocumented exceptions become precedents — the next customer who asks will claim the same treatment was given to a peer, and without a log you cannot dispute it.",[338,343,348,353,358,363,368,373],{"step":339,"title":340,"description":341,"tip":342},1,"Define scope and assign ownership","Identify which business units, geographies, and customer types the policy covers. Name a specific role — not a person — as policy owner so ownership survives staff changes.","If your company has both B2B and B2C sales, scope the policy explicitly to B2B trade credit only — consumer credit is governed by different regulations.",{"step":344,"title":345,"description":346,"tip":347},2,"Set credit application requirements by tier","List the documentation required for each credit tier. Smaller limits need less — bank reference and credit bureau check. Larger limits should require financial statements and a personal guarantee threshold.","Match your documentation requirements to what a commercial credit bureau can verify independently — this cuts application processing time significantly.",{"step":349,"title":350,"description":351,"tip":352},3,"Define your scoring criteria and thresholds","Set minimum scores or benchmarks for each criterion — PAYDEX score, days-to-pay history, current ratio. Document what triggers automatic decline versus manual review.","Pull your last 12 months of bad-debt write-offs and check the original credit scores of those accounts — this tells you where your thresholds should actually sit.",{"step":354,"title":355,"description":356,"tip":357},4,"Establish credit limit tiers and approval authority","Create at least three tiers with dollar bands and the approval level required for each. Make sure the tiers reflect your actual deal sizes — if 80% of customers fall into one tier, split it further.","Set a default credit limit for approved customers who have not requested a specific amount — prevents gaps when sales teams on-board new accounts without submitting a formal request.",{"step":359,"title":360,"description":361,"tip":362},5,"Write the dunning sequence with specific day counts","Map every step from Day 1 past due to collections referral with exact day counts, communication channel, and who is responsible for each touchpoint.","Automate the first two dunning steps in your accounting software — manual reminders get skipped under workload, and consistency is what drives payment.",{"step":364,"title":365,"description":366,"tip":367},6,"Set write-off thresholds and document the procedure","Define the dollar bands and approval authority for write-offs. Attach a brief bad-debt write-off form to the policy as an appendix so approvers have a consistent record to complete.","Keep a log of all write-offs with the original credit score at onboarding — it will tell you whether your scoring criteria need tightening.",{"step":369,"title":370,"description":371,"tip":372},7,"Distribute to sales and finance and schedule the first review","Send the approved policy to both sales and finance with a cover note explaining the approval authority and exception process. Set a calendar reminder for the annual review 12 months out.","Brief the sales team specifically on what they can and cannot commit to — undocumented verbal credit promises made during deals are among the most common sources of disputes.",{"step":374,"title":375,"description":376,"tip":377},8,"Log exceptions from day one","Create an exception register in your CRM or shared drive before the policy goes live. Every deviation from standard terms should be logged with the approver's name, the reason, and the expiry date.","Review the exception register quarterly — a pattern of exceptions in one area signals the policy needs adjusting, not more exceptions.",[379,383,387,391,395,399],{"mistake":380,"why_it_matters":381,"fix":382},"No minimum balance for collections referral","Collections agencies charge 20–40% of the recovered amount. Referring a $150 overdue invoice costs more in fees than the recovered balance is worth.","Set a minimum balance threshold — typically $500 — below which overdue accounts are written off rather than referred externally.",{"mistake":384,"why_it_matters":385,"fix":386},"Allowing sales to grant credit terms verbally","Undocumented verbal terms become disputed facts — the customer believes Net 60 was agreed; the invoice says Net 30. Finance has no record and collection becomes a credibility contest.","Require all credit approvals to be confirmed in writing via the AR system before an order ships. Train sales that verbal commitments on terms are not binding until finance confirms them.",{"mistake":388,"why_it_matters":389,"fix":390},"Single-criterion credit approval using score alone","A customer can have an acceptable credit bureau score but routinely pay 45 days late. Using score as the only filter admits customers who will consistently hit your dunning process.","Add days-to-pay history from trade references as a required second criterion. A customer paying peers in 45 days will likely pay you in 45 days regardless of their credit score.",{"mistake":392,"why_it_matters":393,"fix":394},"Never reviewing credit limits after initial approval","A customer's financial position can deteriorate significantly in 12–18 months. Limits set at onboarding may be four times what the customer can reliably pay, concentrating your bad-debt exposure.","Mandate an annual credit review for all accounts above a defined balance threshold — pull fresh bureau data and updated trade references, and adjust limits accordingly.",{"mistake":396,"why_it_matters":397,"fix":398},"Suspending an entire account when one invoice is disputed","Customers learn to dispute invoices strategically to freeze all payment obligations. Suspending everything gives them leverage and poisons the customer relationship.","Limit suspension to the disputed invoice only. Undisputed balances remain due on their original terms, and a payment plan on the undisputed portion should be agreed before the dispute is resolved.",{"mistake":400,"why_it_matters":401,"fix":402},"Gaps longer than 15 days between dunning steps","Payment prioritization is driven by creditor persistence. A 30-day silence between reminders signals to the customer that the debt is not being actively monitored, and it drops down their payment queue.","Cap the interval between dunning steps at 15 days. Automate the early steps in your accounting software so they fire consistently without manual intervention.",[404,407,410,413,416,419,422,425,428],{"question":405,"answer":406},"What is a credit policy?","A credit policy is a written internal document that defines how a company evaluates customers for trade credit, sets credit limits and payment terms, and manages overdue accounts through dunning, dispute resolution, and collections. It gives finance and sales teams a shared set of rules so that credit decisions are consistent, documented, and defensible.\n",{"question":408,"answer":409},"Why do businesses need a formal credit policy?","Without a written policy, credit decisions are made inconsistently by whoever handles the account — leading to customers on mismatched terms, undocumented verbal agreements, and bad debt that accumulates before anyone notices the pattern. A formal policy reduces days sales outstanding, cuts write-offs, and removes the friction between sales and finance over what terms can be offered.\n",{"question":411,"answer":412},"What should a credit policy include?","A complete credit policy covers: credit application requirements, evaluation criteria and scoring thresholds, credit limit tiers and approval authority, standard and extended payment terms, invoice dispute resolution, a dunning sequence with specific day counts, write-off authority thresholds, collections referral criteria, and an exceptions and review process. Missing any of these creates gaps that staff will fill inconsistently.\n",{"question":414,"answer":415},"Who should approve the credit policy?","Typically the CFO or Finance Director owns the policy and approves exceptions. For companies without a dedicated finance lead, the CEO or business owner should approve it. Both the sales and finance teams should be consulted during drafting — sales knows the customer relationships; finance knows the risk exposure. Without sales buy-in, the policy will be routed around.\n",{"question":417,"answer":418},"How often should a credit policy be reviewed?","At minimum, annually — ideally aligned to the start of the fiscal year when you have a full-year view of bad-debt write-offs and DSO trends. Review it sooner if bad debt spikes, if you enter a new market or customer segment, or if your payment terms change materially. A policy that is more than two years old without a review is unlikely to reflect current business conditions.\n",{"question":420,"answer":421},"What payment terms should our credit policy set as standard?","Net 30 is the most widely used standard for B2B trade credit. Industries with longer supply chains — construction, manufacturing, wholesale — commonly use Net 60. Early-payment discounts such as 2/10 Net 30 (2% off if paid within 10 days) can improve cash flow where customers have the liquidity to take them. Set extended terms as an exception requiring Finance Director approval rather than a default option for sales to offer freely.\n",{"question":423,"answer":424},"At what point should an overdue account be sent to collections?","Most policies trigger a collections referral between 60 and 90 days past due, after at least three documented contact attempts with no payment or agreed payment plan. The balance should exceed a minimum threshold — typically $500 to $1,000 — because agency fees of 20–40% of recovered amounts make smaller balances uneconomical to pursue externally. Document every contact attempt before referral to support the agency's case.\n",{"question":426,"answer":427},"What is the difference between a credit policy and a collections policy?","A credit policy governs the entire credit lifecycle from application through write-off — including who qualifies, on what terms, and how overdue accounts are escalated. A collections policy is a narrower document focused specifically on how the company pursues payment from accounts that have already become delinquent. Many companies combine both in a single credit and collections policy document; others maintain them separately so the collections procedures can be shared with external agencies without disclosing internal credit criteria.\n",{"question":429,"answer":430},"Can a credit policy help reduce bad-debt write-offs?","Yes, directly. Companies that implement formal credit scoring criteria before extending terms consistently report lower write-off rates than those that approve credit on relationship or salesperson judgment alone. The biggest gains come from two areas: requiring a credit application with references before the first order ships on credit, and conducting annual reviews of credit limits for existing customers rather than letting exposure grow unchecked.\n",[432,436,440,444],{"industry":433,"icon_asset_id":434,"specifics":435},"Manufacturing and wholesale","industry-manufacturing","High-value orders shipped on Net 30–60 terms make credit limits and annual reviews critical; concentration risk from a handful of large accounts demands tiered approval authority.",{"industry":437,"icon_asset_id":438,"specifics":439},"Professional services","industry-professional-services","Retainer and milestone billing structures require clear dispute procedures for invoices tied to deliverable acceptance, and a dunning process that doesn't damage ongoing client relationships.",{"industry":441,"icon_asset_id":442,"specifics":443},"Construction","industry-construction","Extended Net 60–90 terms are common; the policy must address mechanics lien rights as a collections escalation tool and subcontractor credit risk alongside customer credit.",{"industry":445,"icon_asset_id":446,"specifics":447},"Retail and distribution","industry-retail","High transaction volume requires automated dunning for small balances, a low minimum threshold for collections referral, and clear procedures for handling seasonal customers who order heavily then pay slowly.",[449,452,454,457],{"vs":106,"vs_template_id":450,"summary":451},"payment-plan-agreement-D13312","A payment plan agreement is a bilateral contract with a specific customer to repay an existing overdue balance in installments. A credit policy is an internal governance document that defines how all customer credit is managed before and after an account becomes delinquent. The credit policy triggers when to offer a payment plan; the payment plan agreement documents the specific terms for that customer.",{"vs":237,"vs_template_id":238,"summary":453},"A sales agreement governs the terms of a specific transaction between seller and buyer — including price, delivery, and warranties. A credit policy governs how the company manages credit extended across its entire customer base. The credit policy sets the framework; the sales agreement references the payment terms that the policy authorizes for that customer tier.",{"vs":133,"vs_template_id":455,"summary":456},"expense-policy-D12682","An expense policy controls how employees spend company money on purchases and reimbursements. A credit policy controls how the company extends money to customers through deferred payment terms. Both are internal financial governance documents, but they operate on opposite sides of the balance sheet — one manages outflows, the other manages receivables.",{"vs":241,"vs_template_id":458,"summary":459},"demand-for-payment-letter-D479","A demand letter for payment is an external document sent to a specific customer to formally request settlement of an overdue balance — often the last step before legal action. A credit policy is the internal document that defines when and how a demand letter should be triggered, by whom, and what documentation must exist before it is sent.",{"use_template":461,"template_plus_review":465,"custom_drafted":469},{"best_for":462,"cost":463,"time":464},"SMBs and growing companies establishing a formal credit process for the first time","Free","2–4 hours to complete and tailor",{"best_for":466,"cost":467,"time":468},"Companies with significant trade credit exposure, multiple product lines, or international customers","$200–$600 for a review by a controller or CFO advisor","1–3 days",{"best_for":470,"cost":471,"time":472},"Large businesses, regulated industries, or companies integrating policy with ERP credit management modules","$1,000–$3,000+ for a finance consultant or CPA engagement","1–3 weeks",[474,475],"accounts-receivable-basics","how-to-reduce-days-sales-outstanding",[242,245,238,477,251,248,478,479,480,481,482,483],"credit-note-D13639","purchase-order-D1411","collection-letter-to-eliminate-disputes-D190","accounts-receivable-D308","sales-invoice-D383","how-to-decide-which-debt-to-pay-off-first-D13205","accounting-policies-and-procedures-D12681",{"emit_how_to":485,"emit_defined_term":485},true,{"primary_folder":98,"secondary_folder":487,"document_type":488,"industry":489,"business_stage":490,"tags":491,"confidence":495},"credit-management","policy","general","all-stages",[488,492,487,493,494],"credit-policy","accounts-receivable","payment-terms",0.95,"\u003Ch2>What is a Credit Policy?\u003C/h2>\n\u003Cp>A \u003Cstrong>Credit Policy\u003C/strong> is a written internal document that defines every rule governing how a company evaluates, approves, and manages trade credit extended to customers — from the credit application and scoring criteria through payment terms, overdue-account dunning, dispute resolution, write-off authority, and referral to collections. It functions as the operating manual for your accounts receivable function, ensuring that every credit decision — regardless of who makes it — follows the same standards and leaves a documented audit trail. Without a formal policy, credit is effectively governed by whoever is closest to the customer, producing inconsistent terms, undocumented exceptions, and bad debt that compounds before anyone recognizes the pattern.\u003C/p>\n\u003Ch2>Why You Need This Document\u003C/h2>\n\u003Cp>Every day your business ships product or delivers services on invoice without a written credit policy, you are accepting customer risk you have not evaluated and setting payment expectations you have not defined. The practical consequences accumulate fast: days sales outstanding drifts upward as each team member follows different follow-up habits, sales commits to payment terms that finance never approved, and write-offs spike because no one escalated overdue accounts through a defined sequence before they aged past recovery. A formal credit policy eliminates each of these failure points by establishing scoring criteria before credit is granted, a dunning sequence that fires consistently once an invoice ages, and clear authority thresholds for write-offs and collections referrals. This template gives you a complete, editable framework you can tailor to your customer base and distribute to finance and sales in an afternoon — replacing ad hoc judgment with a process that protects cash flow and scales with the business.\u003C/p>\n",1781185940873]