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AR Aging : A periodic report that categorizes a company's accounts receivable according to the length of time an invoice has been outstanding. Accounts receivable aging is a critical management tool as well as an analytic tool that helps determine the financial health of a company's customers, and therefore the health of their business.
If an accounts receivable aging demonstrates that a company's receivables are being collected much slower than normal, this is a warning sign that business may be slowing down or that the company is taking greater credit risk in its sales practices.As a management tool, accounts receivable aging may indicate that certain customers are not good credit risks. It can therefore help a company make prudent decisions about whether or not to keep doing business with customers that are chronically late payers.
Ap Aging : - Process of determining which suppliers are being paid on time, which are not, and how far their bills are behind the payment date. This analysis indicates which supplier(s) must be paid first in order to avoid any credit or supply problem
Bank reconciliation
Bank reconciliation statement is a report which compares the bank balance as per company's accounting records with the balance stated in the bank statement.
A company's general ledger account Cash contains a record of the transactions (checks written, receipts from customers, etc.) that involve its checking account. The bank also creates a record of the company's checking account when it processes the company's checks, deposits, service charges, and other items. Soon after each month ends the bank usually mails a bank statement to the company. The bank statement lists the activity in the bank account during the recent month as well as the balance in the bank account.
When the company receives its bank statement, the company should verify that the amounts on the bank statement are consistent or compatible with the amounts in the company's Cash account in its general ledger and vice versa. This process of confirming the amounts is referred to as reconciling the bank statement, bank statement reconciliation, bank reconciliation, or doing a "bank rec." The benefit of reconciling the bank statement is knowing that the amount of Cash reported by the company (company's books) is consistent with the amount of cash shown in the bank's records.
Because most companies write hundreds of checks each month and make many deposits, reconciling the amounts on the company's books with the amounts on the bank statement can be time consuming. The process is complicated because some items appear in the company's Cash account in one month, but appear on the bank statement in a different month. For example, checks written near the end of August are deducted immediately on the company's books, but those checks will likely clear the bank account in early September. Sometimes the bank decreases the company's bank account without informing the company of the amount. For example, a bank service charge might be deducted on the bank statement on August31, but the company will not learn of the amount until the company receives the bank statement in early September. From these two examples, you can understand why there will likely be a difference in the balance on the bank statement vs. the balance in the Cash account on the company's books. It is also possible (perhaps likely) that neither balance is the true balance. Both balances may need adjustment in order to report the true amount of cash.
After you adjust the balance per bank to be the true balance and after you adjust the balance per books to also be the same true balance, you have reconciled the bank statement. Most accountants would simply say that you have done the bank reconciliation or the bank reconciliation.
From My point of veiw as below :-
1) AR Aging , in sample way make excel sheet to clasify the customers according which not paid on monthly
Basis and see the return and follow up the reason and work on it to slove it regardless the reasons.
2) AP Aging , also make excel sheet to clasify the suppliers according to due invoices need to be paid , according to the date of receiving the Goods and apply the payment terms as well.
3) Bank Reconciliation , is make the balance for your company transactions is the same as in the bank statement received by the end of the month in order to see where is the difference between the co.& the bank.
