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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 statements, sales reports (such as Aged Receivables), the To Do List and Business Insights.

 

To change between Daily and Monthly ageing

To change between Daily and Monthly ageing

  1. Go to the Setup menu and choose Preferences. The Preferences window appears.
  2. Click the Reports & Forms tab. You can now select your ageing method.
    Reports and forms tab of the preferences window

 

Ageing example

Assume that you want to age the following invoices as at 31 July 2017 (or any other date in July):

CustomerDateAmountTermsDue
A-Z Stationery1 Jul 17123.4521 days from Inv22 Jul 17
A-Z Stationery14 Jul 17200.5021 days from Inv4 Aug 17
Chelsea Mosset2 Jul 17400.24C.O.D.2 Jul 17
Footloose Dance Studio30 Apr 1725.0030 days from Inv30 May 17
Footloose Dance Studio12 May 17112.3030 days from Inv11 Jun 17
Footloose Dance Studio29 Jun 17149.3030 days from Inv29 Jul 17
Footloose Dance Studio30 Jun 1720.3530 days from Inv30 Jul 17
Footloose Dance Studio6 Jul 1790.7030 days from Inv5 Aug 17
Footloose Dance Studio21 Jul 1785.1230 days from Inv

20 Aug 17

My Town Realty26 May 17210.457 days from EOM7 Jun 17
My Town Realty10 Jun 17142.407 days from EOM7 Jul 17

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.

 

Ageing by invoice date using month names

Ageing by invoice date using month names

Assume you age invoices monthly and identify your ageing periods by month names.

If you age these invoices by invoice date, the invoices will be aged as follows:

 TotalJulyJuneMayPre-May
A-Z Stationery323.95323.950.000.000.00
Chelsea Mosset400.24400.240.000.000.00
Footloose Dance Studio482.77175.82169.65112.3025.00
My Town Realty352.850.00142.40210.450.00
Totals1,559.81900.01312.05322.7525.00
Ageing Percent0.0057.7%20.0%20.7%1.6%

In this example, each ageing period represents the months when the invoices were generated.

Ageing by invoice date using month numbers

Ageing by invoice date using month numbers

Assume you identify your ageing periods by month numbers.

The results above would be the same as per month names, but with different headings, as follows:

 Total1 Month2 Months3 Months3+ Months
A-Z Stationery323.95323.950.000.000.00
Chelsea Mosset400.24400.240.000.000.00
Footloose Dance Studio482.77175.82169.65112.3025.00
My Town Realty352.850.00142.40210.450.00
Totals1,559.81900.01312.05322.7525.00
Ageing Percent0.0057.7%20.0%20.7%1.6%

In this example, each ageing period represents the number of months since the invoice date.

Ageing by invoice terms using month names

Ageing by invoice terms using month names

If you were to age the transactions based on their invoice terms, the results would look like this: 

 TotalCurrentJulyJunePre-June
A-Z Stationery323.95 200.50 123.450.000.00
Chelsea Mosset400.24 0.00 400.240.000.00
Footloose Dance Studio482.77175.82169.65112.3025.00
My Town Realty352.850.00142.40210.450.00
Totals1,559.81376.32835.74322.7525.00
Ageing Percent0.0024.1%53.6%

20.7%

1.6%

In this example, each ageing period represents the month in which the invoice falls due.

Ageing by invoice terms using month number

Ageing by invoice terms using month number

If you were to age the transactions based on their invoice terms and using month numbers, the results would look like this:

 TotalCurrent1 Month2 Months2+ Months
A-Z Stationery323.95 200.50 123.450.000.00
Chelsea Mosset400.24 0.00 400.240.000.00
Footloose Dance Studio482.77175.82169.65112.3025.00
My Town Realty352.850.00142.40210.450.00
Totals1,559.81376.32835.74322.7525.00
Ageing Percent0.0024.1%53.6%

20.7%

1.6%

In this example, each ageing period represents the number of months by which the invoices assigned to the period are overdue.

overdue accounts
AE MAS-NZ