Aged Debt
Money owed to a business by customers, grouped by how long each invoice has been outstanding - typically in 30-day bands covering 0 to 30, 31 to 60, 61 to 90, and 90-plus days overdue. Used to prioritize credit control activity and identify at-risk balances.
Aged debt is the portion of your accounts receivable that has passed its due date - money customers owe you that has not yet been collected. Businesses track aged debt by grouping unpaid invoices into time bands based on how long they have been overdue: typically 0 to 30 days, 31 to 60 days, 61 to 90 days, and more than 90 days. The aged debt report presents this breakdown, usually one row per customer, with totals in each band. It tells you not just who owes you money, but how stale that money is - and that distinction determines where your credit control effort goes first.
How the Aged Debt Report Works
Every open invoice in your accounts receivable is placed into a time band based on its age from the due date. A customer with three unpaid invoices at different stages of overdue appears across multiple columns. The total in each column shows at a glance how much of your outstanding balance is early-stage, manageable, or at risk.
Most accounting platforms - including Xero, QuickBooks, and FreeAgent - generate aged debt reports automatically. The report is typically run monthly as part of a credit control review, though businesses with high invoice volumes or tight cash flow often run it weekly. Where a business management platform connects to your accounting system, you can also trace which jobs or orders are generating overdue invoices and escalate from the source record.
Weekly beats monthly
A 45-day overdue invoice looked fine at your last monthly review. By the time you see it again, it may be heading toward 75 days. Weekly aged debt reviews catch drift before it becomes a dispute.
Using Aged Debt to Protect Cash Flow
The practical value of an aged debt report is prioritization. A business managing 40 open invoices cannot chase every one with the same intensity. The report shows which customers to contact today, which to monitor, and which may need escalation to formal credit control action.
For SMBs in project-based sectors, a single large invoice slipping past 60 days affects cash flow more than ten smaller invoices at 15 days. Watching the 60-plus and 90-plus columns is more useful than monitoring total outstanding balance alone.
Aged debt reports also reveal patterns. A customer who consistently sits in the 31 to 60 column may need shorter payment terms or a proforma requirement on the next order. A spike across the 90-plus column suggests your credit control process is not keeping pace with invoice volume - an operational issue rather than a customer one.
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