Free tool
Enter your bills and due dates to see them sorted into current, 1 to 30, 31 to 60, 61 to 90 and over 90 days.
Why it matters
The report shows who you must pay, how much and how late you are. It is the quickest way to find a bill that was missed or a supplier you are about to upset.
It is also a check on your books. If the total does not match accounts payable, something is posted wrong.
The steps
- Set the report date. Run it at the end of the month so it matches the month-end balance sheet.
- Choose how to age the bills. Age by due date, not invoice date. Bills not yet due sit in the Current column.
- Check the total. The grand total must equal Accounts Payable on the balance sheet at the same date. If not, look for manual journals and prepayments posted to payables.
- Look at the oldest columns. Open every bill over 60 days. Is it in dispute, on hold, a duplicate or just missed?
- Look at the biggest suppliers. Sort by total owing. Large balances in the older columns are the ones that hurt.
- Look for credits and unapplied payments. Negative amounts mean a credit note or a payment that has not been matched to a bill. Apply them.
- Act and note the result. Write a short list of bills to pay, bills to chase and bills to fix. Keep the report as month-end evidence.
Worked example
Example Plumbing Supplies Pty Ltd runs its report at 31 October.
| Supplier | Current | 1-30 | 31-60 | 61-90 | Over 90 | Total |
|---|---|---|---|---|---|---|
| Example Pipe Co | A$4,400 | A$0 | A$0 | A$0 | A$0 | A$4,400 |
| Example Fixings | A$1,200 | A$1,800 | A$0 | A$0 | A$0 | A$3,000 |
| Example Freight | A$0 | A$660 | A$0 | A$2,200 | A$0 | A$2,860 |
| Total | A$5,600 | A$2,460 | A$0 | A$2,200 | A$0 | A$10,260 |
The balance sheet shows Accounts Payable of A$10,260, so the report agrees. The A$2,200 owing to Example Freight is 61 to 90 days overdue. The team checks whether it is disputed before paying.
Common mistakes
- Ageing by invoice date, which makes terms bills look overdue.
- Not matching the total to the balance sheet.
- Ignoring negative lines.
- Reading the report but not acting on the oldest column.
Next step
Use the AP aging report generator first. Then see how to read an aged payables report in Xero.
Common questions
What is the difference between payables and receivables ageing?
Payables ageing is what you owe suppliers. Receivables ageing is what customers owe you.
How often should I run it?
Weekly if you run weekly payments, and always at month end.
Why does the total not match the balance sheet?
Common causes are manual journals to accounts payable, prepayments and bills dated after the report date.
Related how-to guides
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