Accounts Receivable Aging

An accounts receivable aging report groups the money customers owe by how long the invoices have been outstanding — typically current, 1-30, 31-60, 61-90, and 90+ days. It is a core cash-flow and collections tool and a key input lenders review when financing receivables.

The aging report sorts every open invoice into time buckets by its due date, showing at a glance which receivables are current and which are at risk. The further an invoice slides into the 60-, 90-, and 90+-day columns, the lower the probability of full collection — so the report drives collections priorities and the allowance for doubtful accounts. Lenders use AR aging heavily when underwriting invoice factoring and lines of credit secured by receivables: concentration (too much owed by one customer) and a heavy tail of past-due invoices both reduce how much they will advance. The SBA's financial-management guidance covers tracking receivables and cash flow (https://www.sba.gov/business-guide/manage-your-business/manage-your-finances). A healthy aging profile supports stronger [[net-operating-income]] and working-capital positions.

Examples

Frequently asked questions

Why do lenders care about AR aging?

When financing is secured by receivables (factoring, AR lines), lenders advance against invoices most likely to be collected. Past-due and concentrated receivables reduce the borrowing base and the advance rate.

What are typical aging buckets?

Current (not yet due), 1-30, 31-60, 61-90, and 90+ days past due. The 90+ bucket is where collectibility drops sharply and write-off risk rises.

Related terms

Further reading