An
Accounts Payable (AP) Aging Report is a financial document that categorizes and summarizes a company’s unpaid vendor invoices based on their due dates. It helps businesses track outstanding bills, prioritize payments, and manage cash flow effectively.
Key Details in an AP Aging Report :
* Vendor Name : Name of the supplier or vendor.
* Invoice Number: Reference number for each invoice.
* Invoice Date: The date the invoice was issued.
* Due Date: The date payment is expected by the vendor.
* Outstanding Amount: The total unpaid balance.
* Aging Buckets: Categorizes invoices into aging periods:
0–30 days (Current)
31–60 days (Past Due)
61–90 days (Overdue)
90+ days (Significantly Overdue)
Purpose of an AP Aging Report :
* Payment Prioritization: Helps identify which invoices need to be paid first based on urgency.
* Cash Flow Management: Assists in planning and forecasting cash requirements.
* Vendor Relationship Management: Prevents late payments and maintains good vendor relationships.
* Audit and Compliance: Provides transparency and accountability for unpaid bills.
* Financial Health Assessment: Highlights trends in payment delays or potential liquidity issues.
