Glossary
What is an aged receivables report?
Aged debtors is a list of what customers owe, grouped by how long each invoice has been outstanding: usually not yet due, then 1 to 30, 31 to 60, 61 to 90 and over 90 days past due. It shows not just how much is owed but how late it is.
Also called: Aged debtors
The report is read from the oldest band first, because the longer an invoice is unpaid the less likely it is to be paid in full. It sits alongside debtor days: debtor days gives one average figure, while the aged list shows which customers and invoices make it up.
Invoices with no due date cannot be placed in a band, so a careful aged list shows them separately rather than counting them as current.
How it is calculated
Each unpaid invoice is placed in a band by how far past its due date it is on the report date: days overdue = report date minus due date. Common bands are not yet due, 1 to 30, 31 to 60, 61 to 90 and over 90 days. Totals are shown per customer and for each band.
Worked example
Example · illustrative figures
| Customer | Not yet due | 1–30 | 61–90 | Total |
|---|---|---|---|---|
| Customer A | A$4,000 | A$4,000 | ||
| Customer B | A$2,500 | A$2,500 | ||
| Customer C | A$6,400 | A$6,400 | ||
| Total | A$4,000 | A$2,500 | A$6,400 | A$12,900 |
Total owed is A$12,900, but about half of it (A$6,400) sits with one customer more than 60 days late. The total alone would not show that.
How to read it
Read it from the oldest band first: the longer an invoice is unpaid, the less likely it is to be paid in full. Then look at concentration: one customer carrying most of the late money is a different situation from many small late balances. Compare month to month, because a balance moving from one band into the next means it was not paid in between.
Common mistakes
- Ageing from the invoice date rather than the due date, which makes customers on longer terms look late.
- Unapplied credit notes or payments left on the ledger, which overstate what is owed.
- Invoices with no due date counted as current, when they cannot be judged either way.
- Treating the report as complete when the bank has not been reconciled, so recent payments are not yet matched.
How it shows in Nella
Nella’s Receivables role reads your receivables ageing from Xero, QuickBooks or FreeAgent and, if you agree, drafts a chase message for each overdue customer for you to approve and send. See credit control in Nella.
Related
Nella provides financial information and education, not accounting or tax advice.
See it on your own numbers
Nella works these figures out from your books every month. Nella Pro is free for 60 days, no card, including the entries you approve posted to your books. After that, Nella Free keeps reading your books, with no time limit.
Start freeFAQ