The very first question comes in mind is – what is an aging report? Well, per www.answers.com – “Accounts Receivable Aging Report is a report showing how long invoices from each customer have been outstanding. It is an analysis of accounts receivables broken down into categories by length of time outstanding.”
Business benefits of an Aging Report
- Determining the credit history of all customers. The credit history will help companies to decide whether they should continue or discontinue doing business with the customers with a bad credit history.
- Determining the bad debts occurred during the financial year.
- Planning collection calls and at the time of trying to forecast their cash flow.
The ERP solution SAP B1 has a feature called the accounts receivable aging reports. These reports provide a detailed analysis of each customer’s debts owed to your company. Using this report, you can see customers with nil balance, as well as the ones who are creating risk to your business by not clearing their dues. The aging report in SAP B1 is considered as an important tool, which is easy to use, highly intuitive to create and analyze in detail.
Here are some tips to help you understand how to use this feature.
- You can set the filters as per your requirement. For example, you can specify the customers you want to appear on the report and the required relevant sections of the aging report.
- You can select the aging date. This date allows the report to age the receivables. By default, the “To” parameter takes the current date. Therefore, if required, you must change the “To” date as per your requirement.
- You can also view accounts receivable invoice details or if you want to show only the balance, this report can display only balances too.
Identifying bad debts is critical to surviving in business. Identifying customers who will potentially have backlogs that convert to bad debts is even more critical! If you get a tool that can help you identify the trend that your customers are following while making the payments, then it can help your business thrive. The aging report in SAP B1 is an efficient tool that can help you to achieve the same and understand your business so that you can succeed!