Accounts Receivable Aging Report Checklist

Lock the cutoff with the controller before pulling the aging. Cutoff drift — including a payment that posted on the 1st in the prior month's aging — is the most common reason aging totals don't tie to the GL.

Pull the lockbox file, ACH receipts, and merchant deposits from the bank feed. Match each receipt to an open invoice in QBO/NetSuite — short-pays and partial payments are easy to mis-apply against the wrong invoice.

Run the unapplied cash report and clear each line — either match to an open invoice or confirm a customer credit. Unapplied cash sitting on the report inflates AR and distorts every aging bucket.

The AR aging total must equal the AR control account on the trial balance to the penny. Variances usually trace to JEs posted directly to AR (a bookkeeping anti-pattern) or to bank-feed rules miscategorizing receipts.

Run AR Aging Detail (not Summary) as of the cutoff date. Export to PDF or XLSX and attach below; the detail report is what collections will work from and what auditors will request as the period-end PBC.

Confirm the report uses Current / 1-30 / 31-60 / 61-90 / 90+ — or whatever the credit policy specifies. Aging by invoice date vs. due date is a frequent setup error in QBO that shifts everything one bucket older.

A negative balance means a payment or credit memo without a matched invoice. Resolve by applying the credit, refunding the customer, or reclassing to a deposit liability — never let negatives roll forward.

Walk every line in the 90+ bucket with the AR clerk. Categorize each as collectible-with-effort, disputed, or likely write-off. Dollars in this bucket drive both the allowance estimate and the collections priority list.

Pull the prior-month aging and compare bucket totals and DSO. A jump in 31-60 this month usually becomes a jump in 61-90 next month — flag the trend before it becomes a write-off conversation.

Note every disputed invoice with the dispute reason, sales contact, and target resolution date. Disputes left undocumented end up in the allowance estimate by default; tracked disputes can often be cleared with a credit memo or a sales-team call.

For any customer with a 60+ balance over $10K, refresh the D&B / Experian Business report or check public bankruptcy filings. A Chapter 11 filing changes the entire collectibility analysis and may require an immediate full reserve.

Apply the percentage-of-receivables method by bucket (e.g., 1% current, 5% 31-60, 15% 61-90, 50% 90+) per company policy, then layer specific reserves on identified high-risk accounts. Compare to last month's balance to determine the AJE.

Book the entry as Bad Debt Expense / Allowance for Doubtful Accounts. Memo line should reference the supporting workpaper so the auditor can trace the estimate from JE back to the bucket calculation without an email chain.

Build the write-off recommendation list with customer name, invoice numbers, original date, balance, and reason. Per the credit policy, write-offs above the partner-approval threshold need controller or CFO approval before posting.

Use the tiered template set: friendly reminder at 30, firmer at 60, demand letter at 90+. Suppress customers in active dispute or on payment plans so the automated send doesn't undercut a live conversation.

Phone calls outperform email for high-dollar past-due. Confirm receipt of recent invoices, identify any disputes, and get a committed pay date. Document every commitment — broken promises become next month's allowance line.

Each contact gets date, channel, person reached, and committed action. The audit trail supports the allowance estimate (good-faith collection effort) and protects the firm if a balance later goes to a collections agency or to litigation.

One-page memo: total AR, bucket distribution, month-over-month change, top five overdue customers, allowance movement, and write-off recommendations. Lead with what changed, not a recap of the static numbers.

DSO = (AR / Trailing 90-day Revenue) × 90. Bad-debt ratio = Write-offs / Net Credit Sales. Track both as a 12-month rolling chart so the trend is visible alongside the point-in-time number.

Controller reviews the memo, allowance calculation, and write-off list before anything posts to the GL or goes to the CFO. Sign-off here is the internal control that documents segregation of duties between the AR clerk and management review.