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Aged Debtors Analysis

A-VicA-Vic Expertise GuaranteedRegistered Posts: 6,970
Am currently struggling to understand how to prepaire these can anyone please explain them to me

Thanks


Vic

Comments

  • Peter WPeter W Settling In Nicely Registered Posts: 22
    What accounting system are you using?
  • A-VicA-Vic Expertise Guaranteed Registered Posts: 6,970
    Peter W wrote: »
    What accounting system are you using?

    Manually not on computer
  • blobbyhblobbyh Font Of All Knowledge Registered Posts: 2,415
    Are you talking about the report for debts aged current, 1-30 days overdue, 31-60 days overdue and debts aged 61+ days overdue as it's simply just that? A common flaw is to not fully clarify the agreed credit terms with your debtors as it's no good you working from 14 day terms if they're under the impression they've got 30 days to pay.

    Other than that, it's pretty self explanatory... work out the age of your debts and determine which of the aged periods they fall into. Use it in conjunction with your credit control processes to establish the different severity levels of collection procedures according to the number of days overdue...
  • Peter WPeter W Settling In Nicely Registered Posts: 22
    An Aged Debtors Analysis is just a list of trade debtors, at a particular date, which has also been analysed into (normally) amounts due within 30 days, amounts due 30-60 days, amounts due 60-90 days etc.

    The way that you compile this information will depend on the exact way that your manual system is organised. It could be quite a lot of work.
  • A-VicA-Vic Expertise Guaranteed Registered Posts: 6,970
    It just i have one to prepair for college - i have figure from previous month and have to in put from payment made from bank statements and invoices raised and havnt a clue where to start
  • blobbyhblobbyh Font Of All Knowledge Registered Posts: 2,415
    Okay, I guess you have a previous aged analysis to work from and you're to prepare the following months based on bank receipts and the raising of new invoices?

    1) Look for the credit terms offered on the new invoices as this will tell you where they will fall in the new analysis. While it will generally be into the current perod the question setter might be crafty here so check the due dates.

    2) The bank receipts from debtors will clear old invoices and these need to be removed from the new analysis.

    3) Check for particularly aged invoices as these could be under dispute and credit notes may be required.

    4) All the old invoices that are still unpaid will need shifting to the next aged period e.g. if they were in the 1-30 days overdue before they will fall into the 31-60 category now.

    If the question also asks which action needs to be taken based on the new analysis then answer accordingly e.g. who now needs phone calls, who might need letters and who might need more serious action. It might also ask for provisions to be made if someone has gone into - or is suspected to be entering - administration or you have received confirmation of a bad debt that was previously provided for.
  • A-VicA-Vic Expertise Guaranteed Registered Posts: 6,970
    Wonderful thanks robert - just what i was looking for :001_smile:
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