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Company managers use accounts receivable aging reports to monitor overdue accounts. The report usually lists each customer’s amount owed broken down into different date range “buckets.” Typically, these buckets are columns titled Current, 31-60 days, 61—90 days, 90+ days.

Most accounting software programs generate multiple variations of the accounts receivable aging report.  A typical report looks like this:

ABC AR Aging






A Company






B Company






C Company






D Company






Late Company












In the collection process, ABC’s collection department will focus on contacting Late Company and C Company to inquire about payment status. In addition, ABC may send out reminders to A and B about the invoices that are in the 31-60 column. 

Companies often analyze their accounts receivable aging reports over time to determine what percentage of invoices are consistently late or written off. This helps them more accurately predict their allowance for bad debt accounts on their balance sheet.

Also, a company’s credit department uses the accounts receivable aging report to make customer credit decisions. For instance, if Late Company places another order with ABC, the credit department may put a credit hold on Late Company’s account until it pays the $5,000 invoice that is more than 90 days past due. The new order will be processed once the late invoice is paid.

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