Regarding AR invoices, are there any legal requirements as far as using the specific name of a company in the "bill to" portion of the invoice?

Q. (cont): We have clients who have multiple locations and we are trying to determine for our own internal purposes how to identify ABC Company's different locations—such as ABC Company North, ABC Company South.

What is the rule of thumb in the AR world?

A. While we are not aware of any legal requirement, we do not recommend altering a company name for your purposes. It may create confusion or concern on the part of your customer, and it may in fact, create a loophole for a client wishing not to pay an invoice.

In Europe, an invoice is a legal document and there are requirements regarding what is included on the document; while we do not have the specifics of each country, it is probably true that in all EU countries, the name of the customer on the invoice must match a tax ID.

You may be able to find a solution to the problem, however. You might begin with a conversation with the customer to discuss your issue and what you might be able to do that would be acceptable to the customer. For example, you might see if there is a field in your invoice that could identify the “location” of the customer. This depends on the flexibility of your accounting system. Some fields are left open for the user to either activate or not.

Another option may be to devise a naming scheme in the address field. For example, banks in their mailing addresses have locator codes embedded to tell the recipient how to route the mail. Another alternative may be to add a simple code to the name line—but not the name itself—as follows: “Acme Supplies – a”; “Acme Supplies – b”; “Acme Supplies – c”; etc.—where the code is small and separated from the name, so that the customer name itself does not appear altered, as it might in “Acme Supplies South.”

In the latter example, the name could be mistaken for another entity, or may be claimed by the customer as not their bill.

We recommend that you consult your attorneys on the matter before taking any steps to change the information on the “name” line.


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