An aging report lists open customer invoices, or supplier bills, grouped by how long they are past their due date, for example current, 1 to 30, 31 to 60, 61 to 90 and over 90 days. It shows who owes what and how late, so the team knows whom to chase first and how much to provide for credit losses.
What is an aging report?
An aging report, also called an ageing schedule, takes every open item in the receivables or payables ledger at a date and places it in a time bucket. Most reports age by due date, so "current" means not yet due. Some age by invoice date instead, and the report should say which.
The receivables aging drives collections and the credit loss allowance. The payables aging shows what falls due to suppliers and what is already late. Both must agree to their control accounts in the general ledger; an aging that does not tie to the ledger cannot be relied on.
How do you read an aging report?
| Customer | Current | 1 to 30 | 31 to 60 | 61 to 90 | Over 90 | Total |
|---|---|---|---|---|---|---|
| Customer A | 120,000 | 40,000 | 0 | 0 | 0 | 160,000 |
| Customer B | 0 | 0 | 30,000 | 25,000 | 45,000 | 100,000 |
| Customer C | 60,000 | 20,000 | 0 | 0 | 0 | 80,000 |
| Total | 180,000 | 60,000 | 30,000 | 25,000 | 45,000 | 340,000 |
Read it from the right. The older columns hold the money most at risk, and a customer whose balance moves right month after month needs a call, not another email. Compare the total with last month: a growing share over 60 days means collection is slipping even if the total looks steady.
How is an aging report used for the credit loss allowance?
IFRS 9 measures the allowance on trade receivables at lifetime expected credit losses (paragraph 5.5.15) and names a provision matrix, with fixed rates by number of days past due based on historical loss experience adjusted as appropriate, as a practical method (paragraph B5.5.35). The aging report is the input.
Why does the aging report matter, and what makes it wrong?
It tells collections whom to call, credit control whom to put on hold, and the controller how much to provide. It also feeds dunning runs and the cash forecast, so an error spreads.
- Unapplied receipts and credit notes make customers look later than they are. Fix cash application first.
- Balances with other companies in the group sit beside external customers and inflate the overdue figure. Show them apart.
- Manual journals posted straight to the control account break the tie to the ledger. Find and clear each difference.
- Different cut-off dates between the ledger and the aging create false differences. Run both at the same date.
Questions people ask
Should an aging report be by invoice date or due date?
By due date when you are chasing payment, because an invoice is not late until it is due. Invoice-date aging helps when comparing customers on different terms. Always state which basis the report uses.
How often should we run an aging report?
At every month end for the close and the allowance, and weekly for collections. A daily view helps when cash is tight.
Why does our aging not agree to the general ledger?
Usually because of unapplied receipts or credit notes, manual journals posted to the control account, or a different cut-off date. Find and fix each difference, so the aging always ties to the ledger.
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