AP/AR Netting: Is It Right for Your Organization?

In situations where companies both buy and sell from the same organizations, there’s an opportunity to increase efficiency while cutting costs. That strategy is called “AP/AR netting.” Netting simply means that instead of both issuing and paying multiple invoices to those particular business partners, the AP and AR amounts are netted out, and the difference is all that’s paid (or due). It’s simple enough in principle, but to prevent confusion and unnecessary complexity on the bookkeeping side,…