Dunning Management: How CPA Firms and Family Offices Recover Cash Without Chasing Clients

Every finance team has seen it happen. An invoice goes out, the due date passes, and nothing happens.

No objection, no dispute, just silence. Individually, these missed payments may seem harmless.

Over time, they distort accounts receivable, reduce cash flow visibility, and force teams into reactive follow-ups.

This is where dunning management takes center stage.

This article explains what dunning management is, how it fits into accounting workflows, and how Eleven supports dunning-related processes through receivables oversight and reconciliation.

What Is Dunning Management?

Dunning management is the structured process of following up on overdue invoices or failed payment attempts through predefined reminders, retries, and escalation steps designed to recover payment.

When people ask what is dunning management, authoritative accounting and billing sources describe it as a repeatable framework that replaces ad hoc follow-ups with consistent rules for timing, communication, and next actions.

Dunning is closely connected to accounts receivable management because unpaid invoices directly affect AR aging, expected cash inflows, and financial reporting accuracy.

Why Dunning Matters for CPA Firms and Family Offices

Accounts receivable aging reports categorize unpaid invoices by how long they have been outstanding, such as 0–30 days, 31–60 days, and beyond. As invoices move into older aging buckets, the likelihood of successful collection decreases, increasing the risk of write-offs.

For CPA firms, weak dunning processes often lead to:

• Manual follow-ups that do not scale
• Inconsistent client communication
• Limited insight into client payment behavior

For family offices, the impact is different but just as serious:

• Reduced liquidity visibility across entities
• Delayed planning and allocation decisions
• Increased complexity in multi-entity oversight

Because of these risks, dunning is widely considered a core receivables control rather than a billing afterthought.

Before choosing a dunning approach, it helps to understand the scale of the issue. This calculator estimates how much cash may be tied up in overdue invoices based on your receivables (*not legal advice):‍


Components of Dunning Management

Most authoritative sources describe dunning management as consisting of several foundational elements.

• Payment failure identification

Payments fail for reasons such as insufficient funds, expired cards, or bank processing issues. Identifying the cause of failure helps determine whether follow-up should be immediate or delayed.

• Retry logic

Retry logic defines how often and when a payment should be retried after failure. Automated retry schedules are commonly used to improve recovery while reducing manual intervention.

• Pre-dunning

Pre-dunning refers to reminders sent before a payment is due, such as upcoming invoice notifications or expiring payment method alerts. These steps aim to prevent failures rather than respond to them.

• Communication channels

Email and client portals are the most common channels used in dunning. Best practices emphasize clarity, professionalism, and easy access to payment actions.

Why One-Size-Fits-All Dunning Does Not Work

Industry guidance consistently warns against applying identical dunning rules to all clients or invoices. Different relationships, invoice sizes, and payment histories require different approaches.

In professional accounting contexts:

• Long-standing clients may respond better to fewer, more personal reminders
• Low-value, one-off invoices often do not justify manual outreach
• Recurring invoices benefit from early, preventative communication

Segmenting dunning policies helps organizations balance recovery efficiency with relationship preservation.

Segment-Based Dunning Policies

Segment-based dunning involves grouping invoices or clients based on shared characteristics and applying tailored follow-up rules to each group.

Common segmentation criteria include:

• Payment history
• Invoice value
• Length of the client relationship
• Billing frequency

For example, high-value or long-term clients may receive earlier personal outreach, while smaller balances follow automated reminder paths. This approach reduces friction while maintaining consistency across receivables.

Optimizing Retry Timing Using Data

Retry timing plays a significant role in payment recovery. Research and billing guidance show that retries scheduled at appropriate intervals perform better than frequent or poorly timed attempts.

Accounting and billing systems provide useful inputs for timing decisions, including:

• Historical payment success patterns
• Client location and time zone
• Invoice due dates

Using these inputs allows finance teams to move from static schedules to data-informed retry strategies that improve recovery without increasing frustration.

Dunning as Part of Receivables and Credit Management

In accounting contexts, dunning is best understood as part of receivables and credit oversight rather than debt collection. Accounts receivable management focuses on monitoring unpaid invoices and applying timely follow-ups to reduce bad debt risk.

So, when asking what is dunning in credit management, the answer is that it is a preventative process. It helps surface overdue balances early, apply consistent reminders, and reduce the likelihood that invoices become uncollectible.

This approach supports healthier AR aging and more predictable cash flow for both CPA firms and family offices.

Measuring Dunning Success Beyond Recovered Revenue

Recovered revenue is an important outcome, but best practices recommend evaluating additional indicators to assess whether dunning processes are actually improving receivables health.

Common measures include:

• Time to payment recovery
• Changes in AR aging buckets
• Resolution trends over time

These metrics help teams understand whether dunning policies are strengthening long-term financial stability rather than solving isolated issues.

When to Pause, Escalate, or Cancel

Effective dunning frameworks emphasize the importance of defined escalation paths. Not all overdue balances warrant the same response, and rigid cancellation rules can damage relationships unnecessarily.

Best practices recommend:

• Allowing additional retries for trusted clients
• Escalating to manual outreach for higher balances
• Defining clear thresholds for service suspension

These distinctions are especially important for CPA firms and family offices managing long-term relationships.

What Is a Dunning Management System?

A dunning management system is software that helps organizations track overdue invoices, manage reminder workflows, apply escalation rules, and monitor recovery outcomes in a structured way.

These systems generally fall into two categories: standalone dunning tools and dunning functionality embedded within broader platforms.

Standalone Dunning Systems

Standalone dunning tools focus specifically on payment recovery. They typically offer advanced retry logic, automated reminder sequences, and detailed analytics around failed payments and recovery rates. These systems are often used by subscription-based or transaction-heavy businesses where payment failures occur at scale.

However, standalone dunning tools rely heavily on accurate upstream financial data. Without clean invoice records, reconciled payment statuses, and up-to-date client information, even the most sophisticated dunning workflows can produce inconsistent results.

Dunning Within Billing, Payments, or Accounting Platforms

Many billing, payment, and accounting platforms include dunning-related functionality as part of a broader financial workflow. In these setups, dunning is closely tied to invoicing, receivables tracking, and reconciliation.

For CPA firms and family offices, this integrated approach often aligns better with how finance operations are structured. Rather than treating dunning as a separate system, it becomes an extension of receivables oversight, supported by accurate accounting data and consistent documentation.

In both cases, dunning systems are only as effective as the financial data they rely on. Industry guidance consistently emphasizes that strong accounting foundations are a prerequisite for successful dunning management.

How Eleven Supports Dunning Management in Practice

Dedicated dunning systems focus on automating reminders and retries. However, those systems depend on accurate accounting data to be effective.

Eleven is an online accounting platform designed for CPA firms and family offices, providing centralized financial records, integrated document management, multicurrency support, and bank reconciliation.

These capabilities support dunning-related workflows by:

• Providing clear visibility into overdue invoices
• Ensuring payment status aligns with reconciled bank data
• Maintaining documentation and audit trails for client communication
• Supporting oversight across multiple entities and currencies

Accounting best practices recognize that effective dunning depends on clean receivables data and consistent financial records. Eleven provides this foundation, enabling finance teams to run dunning processes with clarity and control, even when using external tools for automated follow-ups.

Final thoughts…

Dunning management is a foundational receivables process supported by established accounting and billing practices:

• Structured follow-ups reduce overdue balances
• Segmentation improves recovery without harming relationships
• Data-informed timing increases effectiveness
• Accurate accounting systems underpin successful dunning

For CPA firms and family offices, platforms like Eleven provide the receivables visibility and financial control that effective dunning management depends on.

If you want to see how Eleven helps you track receivables, keep records organized, and manage multiple entities, you can book a demo to see the platform in action.