How to Use an Accounts Receivable Aging Report
The accounts receivable aging report helps you manage receivables and project future cash flow.
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The accounts receivable aging report summarizes your clients' unpaid invoice amounts and how long past due they are. This helps you see how much people owe you and stay on top of late payments. Neglecting your accounts receivable can cause significant cash flow problems.
Here's more information on the accounts receivable aging report and what you can learn from it.
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Accounts receivable aging report example
The table below is the Accounts Receivable Aging Summary report from the QuickBooks Online sample file.
A word of caution about this report: It’s only as good as the data it summarizes. You have to follow good invoicing practices to make it valuable. An incorrectly-entered invoice date can skew your results. These mistakes can lead to inaccuracies and may even harm your customer relationships.
Don’t be afraid to ask your accountant or bookkeeper for help managing your accounts receivable or interpreting metrics. They can often provide helpful feedback.
Figuring out how much each customer owes
You’ll notice that several customers owe money to the sample company, Craig’s Design and Landscaping Services. The left-hand side of the report above lists each customer that has an open balance with the business. The total amount each customer owes is on the far right-hand side in the "total" column.
It’s important to note that this is a summary report. In other words, each customer could have multiple invoices due, even if the report only lists one amount.
The bottom right-hand corner of the report adds up all of these amounts. In total, the business is waiting on $5,281.52. This number should match the amount of accounts receivable on the company’s balance sheet as of the report date (May 29, 2026).
Breaking down unpaid invoices by due date
The columns at the top of the report break down the aging of each client’s accounts receivable balance. This usually happens in 30-day increments. Here's what each column title means:
Current
This column shows balances that are not yet due. Ideally, you want most of your accounts receivable balance to be in this column. That means your customers typically pay on time.
Here's what each of the labels for the other columns mean:
1-30
The "1-30" column shows balances that were due at some point in the past 30 days. However, they have not yet been paid.
Let’s say John Melton’s $450 balance is all on one invoice that was due on May 25, 2026. Because we ran the accounts receivable aging report on May 29, 2026 — and we haven’t received John’s payment yet — his balance appears in the 1-30 column.
Depending on their customers’ payment history and behavior, many business owners don’t get overly concerned about amounts in the 1-30 silo. They'll likely send them a friendly reminder. But most business owners won’t take any further collection action at this point.
31-60
This column can indicate an impending problem for your business. Amounts in this column are now 31-60 days past due.
Let’s say you applied net 30 terms to Bill’s Windsurf Shop's invoice dated 3/1/2026. That means payment was due on 3/31/2026. Its $85 balance hung out in the 1-30 column until 4/30/2026, but it remained unpaid. Now it’s 5/29/2026 — nearly three months after you made the sale — and you still haven’t been paid.
Most businesses will get a bit more aggressive on collecting from customers with an amount in the 31-60 column. They might refuse to do additional work for the customer until the balance is paid in full. Some business owners will even start mentioning the possibility of sending the amount to collections.
61-90 and 91 and over
These two columns are often the most worrisome. At this point, you made the sale at least three months ago. The customer has derived the benefits from the product or service. But they still haven’t paid you. Most businesses will take more aggressive collection actions against amounts in these columns.
» MORE: How to write off unpaid invoices
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What else can the accounts receivable aging report tell you?
For the most part, the accounts receivable aging report helps you determine which customers you need to pursue more aggressively for payment. But there are a couple of additional uses:
Project cash flow
If your cash position is getting tight, you can use your accounts receivable aging report to project upcoming cash flow.
Using the above example, let’s say Craig has $1,000 in his business checking account, and he knows he has $3,000 worth of expenses coming up in the next 30 days. However, he also knows most of his customers pay their invoices on or before the due date. And the customers in the Current and 1-30 days silos have a good track record of making timely payments. Looking at his accounts receivable aging report, he can deduce he will likely have enough money to cover his upcoming expenses.
Determine credit policies and payment terms
Maybe your business has a high success rate of collecting from customers. But they take a long time to pay. At any given time, most of your accounts receivable is in the 31-60 or 61-90 column. This can indicate you need to either tighten up your credit policies or adjust your payment terms. After all, the payment terms you offer on your invoices directly influence when your customers pay you.
If most of your accounts receivable balance is in the 31-60 or 61-90 column, consider tightening up your payment terms. Maybe you start enforcing net 15 instead of net 30 terms to collect payments more quickly. Don’t let “being nice” get in the way of your business’s cash flow health.
A version of this article was first published on Fundera, a subsidiary of NerdWallet.
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