AR Aging
A report categorizing outstanding invoices by age.
An AR aging report organizes outstanding invoices into time buckets—typically current, 1–30 days past due, 31–60, 61–90, and 90+ days. It provides a snapshot of collection health and identifies which customers are falling behind. The report is essential for managing collections, estimating bad debt allowances, and predicting future cash inflows.
Example
A service company's AR aging report shows $40,000 current, $12,000 at 1–30 days, $5,000 at 31–60 days, and $3,000 at 90+ days—the 90+ bucket triggers immediate collection calls.
Why It Matters for Your Business
The AR aging report is your early warning system for cash flow problems—invoices that sit unpaid too long are increasingly likely to become uncollectible.
Practical Tips
- •Review your AR aging report weekly and follow up on anything over 30 days immediately.
- •Set up automated dunning emails at 15, 30, and 45 days past due.
Related Terms
More Invoicing Terms
Billing Cycle
The recurring period between billing statements.
Credit Memo
A document reducing the amount owed by a customer.
Days Sales Outstanding
Average days to collect payment after a sale.
Invoice
A document requesting payment for goods or services.
Late Fee
A charge applied when payment is not received by the due date.
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