Aging schedule

Aging schedule presents relation between bills and invoices of a company. It has a form of a table, usually created by accounting software. It can be used to monitor whether customers pay in time, as well as whether the company pays to suppliers on time.

There are several methods of categorization, but the most common is:

  • current - under 30 days,
  • past less than 30 days,
  • past less than 60 days,
  • past less than 90 days,
  • past more than 90 days.

The strategy of payment of due invoices depends on strength of supplier and possibility of negotiation. Similarly in case of customers. The company usually wants to keep as many invoices as possible in first category and not let them to move to other categories.

References

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