Accounts Receivable” or “AR” is a financial term that refers to a company’s outstanding receivables, short-term money owed and other rights to payment for services or goods that it has provided, but for which it has not yet received payment. In addition to being an important Due Diligence item for prospective Investors and Acquirers, Accounts Receivable is an essential component of a company’s Working Capital, and it is important for Buyers and Sellers in M&A transactions to negotiate how Accounts Receivable will be handled as part of the overall transaction.

AR is often entered under the column heading Assets on a Balance Sheet. See also Accounts Payable.