An accounts receivable aging report groups unpaid customer invoices by how long they have been outstanding. It helps a business identify overdue balances, prioritize collections and assess whether receivables may require a loss allowance.
How is an aging report structured?
Open invoices are commonly grouped into current, 1–30 days overdue, 31–60 days, 61–90 days and more than 90 days overdue. The exact buckets should match the company’s credit and collection process.
Illustrative accounts receivable aging
| Aging bucket | Amount | Share of total |
|---|---|---|
| Current | $110,000 | 55% |
| 1–30 days overdue | $45,000 | 22.5% |
| 31–60 days overdue | $25,000 | 12.5% |
| 61–90 days overdue | $12,000 | 6% |
| More than 90 days overdue | $8,000 | 4% |
| Total | $200,000 | 100% |
In this example, $90,000 is overdue and $20,000 has been outstanding for more than 60 days. The report indicates collection exposure but does not by itself determine which balances are uncollectible.
How is invoice age calculated?
Use a consistent reference date and define whether age begins on the invoice date or due date. For an overdue report, days overdue normally equal the report date minus the contractual due date.
How is the report used?
Collections teams use it to prioritize follow-up. Finance teams use it for cash forecasting, credit-limit reviews and expected-credit-loss analysis. Management can also identify customers with repeated payment delays.
What can make the report unreliable?
Unapplied receipts, disputed invoices, duplicate customer records, credit notes and incorrect due dates can distort aging. Reconcile the report to the accounts receivable control account and investigate old unmatched items.
