Table of Content

Ageing Analysis

Ageing analysis groups unpaid customer invoices or supplier bills by how long they have been outstanding.

In Australia, you will usually see the spelling “ageing”. The idea is simple: unpaid amounts are sorted into time bands so you can see what is current, due soon, overdue, or becoming a problem.

Ageing analysis is most often used for accounts receivable, but it can also be used for accounts payable.

Where Ageing Analysis Appears

You may see ageing analysis in debtor reports, creditor reports, month-end reviews, cash flow meetings, collection follow-up, supplier payment planning, and accountant reports.

It links closely with accounts receivable turnover ratio, accounts payable turnover ratio, cash budget, and cash conversion cycle.

How Ageing Analysis Works In Practice

An ageing report sorts unpaid amounts by age bands. Common bands include:

  • current
  • 1 to 30 days overdue
  • 31 to 60 days overdue
  • 61 to 90 days overdue
  • more than 90 days overdue

The report helps you focus on the invoices or bills that need attention first.

Simple Example

A design studio has $18,000 in unpaid invoices:

  • $8,000 is not due yet
  • $5,000 is 1 to 30 days overdue
  • $3,000 is 31 to 60 days overdue
  • $2,000 is more than 90 days overdue

The ageing analysis shows that the owner should not treat all $18,000 the same. The oldest $2,000 may need a direct call, a payment plan, or a write-off discussion with the accountant.

Why Ageing Analysis Matters

Ageing analysis protects cash flow because it shows when earned money is not arriving. It also helps prevent duplicated follow-up, forgotten invoices, and awkward customer conversations caused by stale records.

For payables, ageing analysis helps plan supplier payments so the business can meet obligations without losing sight of cash needs.

How Gimbla Can Help

Gimbla helps keep invoices, payments, bills, and bank reconciliation current. Cleaner payment records make ageing reports more useful because paid invoices are less likely to be chased by mistake.

Helpful Gimbla Guides

In Short

Ageing analysis shows how old unpaid invoices or bills are. It turns a single balance into a practical follow-up list.