Accounts Receivable Aging

What is accounts receivable aging?

An accounts receivable aging report sorts your unpaid invoices into time buckets based on how many days have passed since the invoice date or due date. It gives you a quick view of how much of your accounts receivable is current and how much is late.

The older an invoice gets, the less likely it is to be paid, so aging reports help you act before small delays become losses.

Typical aging buckets

Most aging reports use these ranges:

• Current: Not yet past the due date
• 1 to 30 days: Recently overdue, usually a reminder is enough
• 31 to 60 days: Needs direct follow-up by phone or email
• 61 to 90 days: At risk, consider pausing work for this client
• Over 90 days: Serious risk of becoming bad debt

Using an aging report

Review your aging report weekly. Send a payment reminder for anything newly overdue, call clients with overdue invoices past 30 days, and look for patterns in who pays late. A shrinking over-90 bucket usually means your days sales outstanding is improving too.