Aged Accounts Payable Report

An aged accounts payable report sometimes referred to as an aged creditors report, is used as a management tool to monitor the age of the outstanding payables from supplier or vendor invoices, allowing early action to be taken to ensure good trade credit terms are maintained with suppliers, invoices are paid at the appropriate time, and early settlement discounts are taken whenever possible. In addition the aged accounts payable report can be used to help predict cash flow requirements for future accounting periods.

The schedule of accounts payable is produced by analyzing vendor invoices into several different age classifications based on the number of days the invoice is past its due date. For example, if the invoice is unpaid 27 days after its due date it would be placed in the 1-30 days classification column, or if the invoice was unpaid 55 days after its due date it would be placed in the 31-60 days column.

On the report, a sub-total is drawn showing the aged accounts payable for each supplier, and a total line shows the aged accounts payable for the business as a whole. Finally, a line is added to show what percentage of the total outstanding accounts payable is represented by each age classification. For instance, in the example aged accounts payable report below, the amount outstanding between 1 – 30 days is 2,800, and this represents 2,800/15,700 or 17.8% of the total aged accounts payable.

Aged Accounts Payable Report
Supplier Amount Current 1 – 30 31 – 60 > 60
Invoice 1 2,800 2,800
Invoice 2 5,100 5,100
Supplier A 7,900 5,100 2,800
Invoice 3 1,600 1,600
Invoice 4 2,400 2,400
Supplier B 4,000 2,400 1,600
Invoice 5 2,600 2,600
Invoice 6 1,200 1,200
Supplier C 3,800 1,200 2,600
Total 15,700 6,300 2,800 2,400 4,200
Percentage 100.0% 40.1% 17.8% 15.3% 26.8%

A business will normally produce an aged accounts payable report at the end of each accounting period, although with today’s accounting software they can be produced at any time.

The aged accounts payable example report above shows overdue vendor invoices and may mean that the business is placing too much reliance on supplier credit to fund its business or that cash is not being properly controlled.

Last modified December 20th, 2019 by Michael Brown

About the Author

Chartered accountant Michael Brown is the founder and CEO of Double Entry Bookkeeping. He has worked as an accountant and consultant for more than 25 years and has built financial models for all types of industries. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. He has been a manager and an auditor with Deloitte, a big 4 accountancy firm, and holds a degree from Loughborough University.

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