Aging report

A list of unpaid invoices sorted by how long they have been outstanding.

Why it matters

Factors use aging reports to identify overdue invoices approaching the recourse period, flag account debtors with deteriorating payment patterns, and calculate cross-aging thresholds that can make new invoices ineligible. An aging report showing a concentration of invoices past 60 days from a single customer signals a potential credit problem. Sellers should review their own aging reports before submitting to the factor to catch invoices that may be declined or held. Regular aging review is also used to track the reserve balance and anticipate when reserves will be released.

How it appears in contracts

Factoring agreements typically require sellers to provide updated accounts receivable aging reports on a defined schedule, often weekly or monthly, in a format specified by the factor. The aging report is used to verify that the outstanding advance balance matches the funded invoice population. Significant discrepancies between the reported aging and the factor ledger can trigger a request for additional documentation or an audit. Aging reports are also used to calculate cross-aging: if a debtor has an invoice past a defined threshold, all invoices from that debtor may become ineligible regardless of age.

Related terms

Related article: What is invoice factoring?

Related reading

Sources

  • International Factoring Association - International Factoring Association. Accessed 2026-05-19. Industry association source for factoring terminology and industry context.
  • Secured Finance Network - Secured Finance Network. Accessed 2026-05-19. Industry education source for secured finance and asset-based lending context.
Financial disclaimer. This page is educational only and is not financial, legal, tax, accounting, or credit advice. Factoring terms vary by provider and contract. Read the full disclaimer.