Accounts receivable reports provide visibility into the status of customer payments against current invoices. They’re used for managing customer relationships and cash flow, as well as evaluating the efficiency of a business’s invoicing and credit control processes.
All about Accounts Receivable
Accounts receivable are all the payments owed to a company by its customers and other parties.
There are three main kinds of report that are important for accounts receivable: receivables reports, which list invoices issued and payments due for each customer; aging reports, which show the length of time invoices have been outstanding, which are overdue and by how long; and customer payment history reports, organised by invoice and payments made.
Accounts receivable reports are derived from information in the sales ledger, including details of purchase orders and invoices. Information about payments received are provided by bank statement or digital payment records.
Accounts receivable is reported under Current Assets on the balance sheet.
The importance of accounts receivable
Getting paid on time is crucial for any business's cash flow and ultimate survival, so avoiding late payments and bad debts is essential. Accounts receivable reports are the key accounting tools to manage a company’s accounts receivable balance and forecast cash flow. The reports alert a business to any payments that are overdue so it can take mitigating action and avoid bad debts.
Traditionally, accounts receivable reporting was a monthly accounting activity guiding any credit control activities, but as accounting has gone digital and real-time data is widely available, accounts receivable have become an on-demand real-time query allowing action to be taken more efficiently.
Accounts receivable is the money owed to a business by its customers and is recorded under “current assets” on a company's balance sheet because it is typically due for payment within a year. Managing accounts receivable relies on three principal kinds of report.
Customer receivables reports
Customer receivables reports break down the accounts receivable balance by customer. Customer receivables reports allow a business to see how receivables change as customer payments arrive and are matched against invoices. The reports include open receivables awaiting payment, closed receivables that have been paid, as well as unbilled orders that have not yet been invoiced.
Aging reports
Aging reports break down unpaid invoices by time showing how long an invoice has been outstanding beyond its payment terms. These reports allow a business to take appropriate collection action as well as estimate bad debt. Summary aging reports show the total invoiced amount outstanding in each time period, while detailed aging reports list the actual invoices outstanding in each period. Aging reports can also be organised by salesperson, region, invoice number and collections agent, allowing the company to identify any problem areas.
Payment history reports
Payment history reports show individual customers' payment history and are used to manage regular customers and come in two forms: payment history by payment made and payment history by invoice.
6 essential Accounts Receivable reports
Accounts receivable register
The accounts receivable register report is a list of all the billing activity for a given period. The report typically includes the invoice number, customer name, date and sale amount. The register also includes any billing adjustments made, credit memos and customer payments received. The accounts receivable register is sometimes called a subledger, because it provides all the detailed information behind the totals that are posted into a company's accounts receivable account in the general ledger.
Receivables by customer report
The receivables by customer report displays outstanding balances by customer for invoiced receivables and is typically organisedby customer name or customer number. Any outstanding balances reduce automatically as customer payments are matched to receivables. A business can use this report as part of their credit management and receivables collection processes.
Aging summary report
The aging summary report provides an overview of any unpaid invoices grouped by the length of time the invoice has been overdue. For each customer with monies owing, the report shows what the customer owes for the current billing period and any previous billing periods.
Aging detail report
The aging detail report adds more detail to the information shown in the aging summary report. Rather than showing the total outstanding payments for a customer, the aging detail report shows each individual unpaid invoice and typically includes details such as customer name, transaction type, date of invoice, due date, invoice number, invoice description, tax breakdown and amount due.
Payment history by invoice report
The payment history by invoice report provides details of each customer's payment history arranged by invoice, showing how those invoices were settled. This information can be helpful when reconciling customer accounts.
Payment history by payment report
The payment history by payment report shows each customer's payment history organised by payment, including how those payments were applied to invoices. This report includes all methods of payment and can be helpful when reconciling or tracing a customer's payment method through the billing process.
These essential accounts receivable reports help a business to manage its cash flow, maintain good customer relationships and minimise the chance of bad debts. This helps a company to deliver sustainable growth and strong returns over the long term.
NetSuite automates accounts receivable reporting
NetSuite's automated accounting software automates accounts receivable processes in real time, matching customer payments to invoices as they arrive and providing managers with an instant insight into receivables movements. Its accounts receivable dashboard enables managers to view key indicators instantly and to drill down into detail with a range of bespoke, configurable receivables and aging and history reports, all updated in real time.