The Aging Report Glow-Up: Why Your Year-End Review Needs It

Let’s talk about something that rarely gets the spotlight but quietly holds the keys to your financial clarity: your aging reports.

If you’re a small business owner, you probably know who owes you money and who you owe, but the details can get fuzzy fast. That’s where aging reports come in. They break down your accounts receivable (what clients owe you) and accounts payable (what you owe vendors) by how long those balances have been sitting around. Think of it as a time-lapse of your cash flow.

At year-end, reviewing these reports isn’t just helpful, it’s essential. Here’s why:

• You might be owed more than you think. That invoice from September? Still unpaid. Aging reports help you spot overdue payments so you can follow up before the year closes.

• You might owe more than you realize. A forgotten vendor bill can throw off your budget and tax prep. Catch it now, not in February.

• It helps clean your books. If you have old balances that aren’t collectible or payable anymore, this is the time to write them off or resolve them.

• It improves your tax accuracy. Knowing exactly what’s outstanding helps you report income and expenses correctly. It also helps your CPA avoid surprises.

So before you dive into holiday mode, take a moment to run your aging reports. Look for anything over 30, 60, or 90 days. Follow up, clean up, and set yourself up for a smoother January.

Your books will thank you. And so will your future self.