Every business person knows that accounts receivables are a part of working capital. Working capital enables the liquidity and profitability of a company. That is why it is essential to manage receivables. The longer you prolong the collectability of Accounts receivables, the more it becomes detrimental to the business or the riskier it becomes. The higher the risk, the higher the probability of losing client’s trust. Hence, a company needs to learn how to create appropriate credit policies. Those policies will enable the company to gauge credit-worthy customers.