An A/R aging report contains a list of your customers' unpaid invoices since the time the sales invoice was issued along with their duration. In other words, the accounts receivable report lists the amount due from your customers. This report helps you identify invoices that are open and allows you to keep on top of delinquent receivables.
On an aging report, invoices will show as current until the due date. Once the due date arrives, invoices will start the aging timeline. Aging is categorized 1-30, 31-60, 61-90+ days past due. Tracking your A/R aging report in a regular cadence (weekly or monthly) will help you identify concerns before they become a cash-flow crunch to your business.
For instance, you create an invoice for a customer that is due on the 15th. The A/R is current until the 16th, then it starts aging and will show up on the A/R report in the 1-30 day column. If the customer still hasn’t paid by the 15th of the following month, the invoiced amount will be in the 31-60 day column. If another 30 days go by and the invoice has not been paid, it will be in the 61-90+ column where it will stay until paid.
Let me know if you have any more questions about accounts receivable or anything else. I’m here to help!