How does accounts receivable decrease cash flow?

Accounts receivable is basically the debt owed to a company by their customers. Therefore, if a company has a high amount of accounts receivable, the company is unable to use that money, as opposed to if it were cash.

If a customer buys something on credit, it is an "I Owe You" to the company. The company is not able to use the money until the customer pays. Once the customer pays, the company has an increase in cash.