XBert Type: Standard
Accounting Software: Xero, MYOB, QuickBooks Online
Country Restriction: New Zealand only
Risk Type: Tax Risk
Business Function: Sales
Overview
This XBert checks whether you have raised a sales invoice for a customer whose company is going through insolvency, such as liquidation or receivership. Selling to a business that is being wound up makes it far less likely you will be paid, so it pays to know before you keep supplying or chasing the debt.
What it does
XBert looks at the customers on your sales invoices and matches each one to the official New Zealand company register. It then checks the current status of that company. When a customer's registered status shows an active insolvency event, XBert flags any invoice you have raised to them.
How it works
XBert matches the customer on your invoice to the New Zealand Companies Office record using their NZBN or GST number, so the match is reliable and not based on a similar name alone. If that company's official status is one of the insolvency states below, XBert raises the alert:
In liquidation
In receivership
In statutory management or statutory administration
In voluntary administration
Any combination of the above
XBert only looks at live sales invoices, those in draft, submitted (awaiting approval) or authorised states. It deliberately ignores invoices that have been deleted or voided, and it only raises the alert once the customer has been reliably matched to the register. A customer that has simply been removed or de-registered, or one that is still trading normally, will not trigger this XBert.
Example/Use Case
Mereana runs a commercial cleaning company in Hamilton. She raises a $4,200 invoice to one of her regular clients, Riverside Hospitality Ltd, for the month's work. XBert matches Riverside to the Companies Office register by its NZBN and finds the company has just been placed in liquidation. XBert flags the invoice straight away. Mereana checks the register, confirms a liquidator has been appointed, pauses any further cleaning work, and lodges her $4,200 as a claim with the liquidator rather than continuing to build up an unpayable debt.
Accounting software
This XBert runs for businesses connected through Xero, MYOB and QuickBooks Online.
Which countries it supports
This XBert is available for New Zealand businesses only, because it relies on the New Zealand Companies Office register and NZBN data.
Processes
Business area: Sales (Accounts Receivable). To resolve this XBert:
Open the flagged invoice and confirm which customer it relates to.
Check the customer's current status on the New Zealand Companies Office register to confirm the insolvency event and the type (liquidation, receivership, statutory management or voluntary administration).
Decide whether to pause any further work, supply or new invoices for this customer while they are insolvent.
If the customer is in liquidation or receivership, contact the appointed liquidator or receiver and lodge your outstanding invoice as a claim.
Review any unpaid balance and consider whether it should be written off or provided for as a doubtful debt, following your usual process and any advice from your accountant.
Update the customer's contact record so the team is aware of the insolvency before raising any new invoices.
Once you have reviewed and actioned the invoice, mark the XBert as resolved.