How to run an aged debtors report and what to do with it

An aged debtors report is a list of every unpaid invoice your customers owe you, grouped by how long each one has been outstanding - typically in 30-day bands: current, 1-30 days overdue, 31-60 days, 61-90 days, and 90-plus. The report shows the total balance, the oldest debt, and which customers have let multiple invoices stack up. What you do on the Monday after you run it is not to review it at the next management meeting. You open it, you put a name against every overdue line, and that person contacts the customer before lunch. The report is a work list. Treat it as anything else and the money stays where it is.

What the report is and is not

The aged debtors report is sometimes described as a financial health indicator, and at a board level it serves that purpose - a rising proportion of 60-plus-day debt signals that credit control is not working. But for the person running a small or medium-sized business day to day, that diagnostic function is secondary. The immediate value is operational: it tells you which invoices are overdue, by how much, and for how long.

The report does not tell you why invoices are late. A line sitting in the 31-60 column might be there because a customer is short of cash, because the invoice was never received, because there is a dispute nobody has flagged, or simply because nobody has chased it. The report cannot distinguish between those causes. Only a phone call can.

UK law gives businesses the right to charge statutory interest on late commercial payments once a payment passes its agreed due date - or 30 days after invoice receipt if no date was agreed. That right exists whether or not you exercise it. The practical point is that the clock starts running regardless, and the longer a debt sits in the report, the harder it becomes to collect. Research published in July 2025 by the UK Department for Business and Trade and the Office of the Small Business Commissioner estimated that around £26 billion is owed to UK businesses in late payments at any given time - and that approximately 14,000 UK businesses close each year in circumstances where late payment was a contributing factor. Those are national figures; they do not help you collect the invoice in the 61-90 column. But they clarify why an unread report is expensive.

The one column that changes behavior

Most versions of the report include the same fields: customer name, invoice number, invoice date, due date, balance due, and days overdue. The field that is almost never included by default is the one that matters most: who in your business is chasing that line this week.

Without an owner column, the report is a passive list. Everyone who reads it knows the debt is there. Nobody knows whether someone has already called, agreed a payment plan, or done nothing at all. The result is what happens to most overdue invoices: the automated reminder goes out, the customer ignores it, and two weeks later the invoice has aged into the next bucket with no action recorded.

Adding a "chaser" column to your working version of the report - even in a copied spreadsheet - changes the conversation you have around it. Instead of reviewing balances, you are reviewing actions. The question shifts from "how much is outstanding" to "what happened when you called, and when are they paying." That is the question that collects money.

Turning the report into a week's work

Run the report on Monday morning. Filter to everything more than 14 days overdue - current-period invoices rarely need contact this early, and chasing them wastes time that should go on older debt. Sort by value descending within each age band, because a £15,000 invoice at 45 days overdue is a different priority from a £200 one at the same age.

For each line in the 31-60 band: send a statement of account if you have not done so this month, then follow up by phone within 48 hours. For each line in the 61-90 band: phone first, then email with the statement attached the same day. For anything over 90 days: escalate. That might mean a senior person in your business making contact directly, or it might mean a formal letter before action. Leaving it in the report for another week rarely improves the outcome.

Assign the calls and emails before you close Monday morning's review. If nobody leaves the conversation with a name against each overdue line, nothing happens by Friday.

When the same invoice appears two weeks running

An invoice that appears in the same age band across two consecutive weekly reviews either has not been contacted effectively, or contact has been made and the customer is not responding. These are different problems with different responses.

If the invoice has not been contacted, find out why. Is there a dispute neither side has raised? Is the invoice going to the wrong person at the customer's business? Was the original work signed off and accepted? Getting an invoice paid sometimes means resolving an open question on the job before the payment conversation can happen.

If the customer is not responding after genuine contact, the report has done its job. The next step is not a better-worded email. It is a decision about whether to continue trading on credit terms with this customer, or to take formal recovery steps. Zigaflow's invoices feature tracks the complete invoice history - which invoices have been issued, viewed, and disputed - giving you a clear record to rely on if a conversation escalates to a formal dispute or a letter before action.

The aged debtors report run once a month and filed away is a record of money you did not collect. Run weekly, with a named owner against every overdue line and actions reviewed before the following Monday, it is one of the more straightforward cash flow tools a small business has available. The columns showing age and balance give you context. The column showing who is chasing is the only one that moves the numbers.

Sources

• Late commercial payments: charging interest and debt recoveryGOV.UK · accessed 2026-09-14
• Small Business CommissionerGOV.UK · accessed 2026-09-14
• Late Payment Statistics UK (2026)NudgeBadger · accessed 2026-09-14
• Aged Debtors Reporting That Drives ActionTaurus Collections · accessed 2026-09-14

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