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Monthly ageing of invoices

Analysing ageing periods can help you monitor how much money your customers owe you, and identify when money is due to come into your business. You can use this information for a number of purposes:

  • Identify the customers who regularly pay late. You might then send out reminder letters or adjust their credit limits accordingly.

  • See which customers whose payments are most overdue, or which ones owe you the most.

  • Check on your cash flow. If a lot of money is overdue now, you might end up with cash flow problems later. By monitoring the ageing of amounts, you can identify potential cash flow problems and try to fix them.

There are many reports and tools in AccountRight that show your aged invoices, this includes customer statementssales reports (such as Aged Receivables), the To Do List and Business Insights.

Ageing example

Assume that you want to age the following invoices as at 31 July 2023 (or any other date in July):

Customer

Date

Amount

Terms

Due

A-Z Stationery

1 Jul 17

123.45

21 days from Inv

22 Jul 23

A-Z Stationery

14 Jul 17

200.50

21 days from Inv

4 Aug 23

Chelsea Mosset

2 Jul 23

400.24

C.O.D.

2 Jul 23

Footloose Dance Studio

30 Apr 23

25.00

30 days from Inv

30 May 23

Footloose Dance Studio

12 May 23

112.30

30 days from Inv

11 Jun 23

Footloose Dance Studio

29 Jun 23

149.30

30 days from Inv

29 Jul 23

Footloose Dance Studio

30 Jun 23

20.35

30 days from Inv

30 Jul 23

Footloose Dance Studio

6 Jul 23

90.70

30 days from Inv

5 Aug 23

Footloose Dance Studio

21 Jul 23

85.12

30 days from Inv

20 Aug 23

My Town Realty

26 May 23

210.45

7 days from EOM

7 Jun 23

My Town Realty

10 Jun 23

142.40

7 days from EOM

7 Jul 23

The examples below show the two ageing methods you can use when reporting aged receivables:

  • Number of days since invoice date

  • Days overdue using invoice terms.