Golden business idea.

Maintain a Good Credit Policy

As the company accountant, you often have the responsibility for setting and maintaining credit policy. And as you know, the sales department is wont to complicate your job because it invariably wants to extend and expand credit to every customer no matter what its financial condition. Often you're the o=fly effective gatekeeper in this area. Steps you can take:

* Resist efforts to issue credit lines to new customers without getting thorough credit checks.

* When asking for bank references, be sure also to ask for a breakdown of each of the customer's accounts. While large balances are reassuring, be sure that their bank loans are being repaid.

* When checking the applicant's other business references, be sensitive to the likelihood that only "friendly" references were provided, which means you should dig deeper and certainly not take all reports at face value.

* Maintain an up-to-date credit file, recording payment patterns. That way you can recognize a pattern change that may signal problems ahead.

* Even if payments are regular, check the credit reporting services for each customer at least annually. Again, that may provide you with a warning of an impending problem.

* Make it clear to the salespeople that it's their responsibility to keep you abreast of a customer's trouble signs such as layoffs or production cutbacks.

* Draft policies on how quickly you need to take affirmative action against a slow payer. Be aware that many customers who typically experience large cash-flow swings have developed very sophisticated ways to stretch payments by cycling their on-time payments among various suppliers.

* And obvious as it may seem, failure to send out timely invoices can have a devastating impact on your cash flow.

Praise Good Work

The very best reason to be generous with compliments and thank-yous is that it will help you keep talented people when your money won't.

Keep Bank Fees Under Control

No one has to tell you how expensive bank fees have become. And while it's prudent to develop strong, long-term relations with a financial institution, no one says you must maintain such a relationship even when the bank begins raising fees or creating new ones. Things you can do to keep your bank on its competitive toes and thus keep a lid on those fees:

* Make sure its management is aware that you will ask for competitive bids on your banking business every few years. That sends two messages to your bank: You're a prudent manager who monitors expenses, and the bank had better think twice before boosting fees or slipping in a new, fee category.

* Question fees. You may find you're paying for a service you neither use nor need.

STANLEY ZAROWIN, a former JofA senior editor, now is a contributing editor to the magazine. His e-mail address is zarowin @mindspring.com.

An Invitation

The JofA publishes a monthly collection of Golden Business Ideas and invites readers to contribute their favorites (for attribution, if you like).

Send your ideas to contributing editor Stanley Zarowin via e-mail at [e-mail] or regular mail at the Journal of Accountancy Harborside Financial Center, 201 Plaza Three, Jersey City, NJ 07311-3881.