aging

Aging

A method used by accountants and investors to evaluate and identify any irregularities within a company's account receivables. Aging is achieved by sorting and inspecting the accounts according to their length outstanding.

Notes:

By aging a company's accounts receivables, one can get a better view of a company's bad debt and financial health.

See also: Accounting, Accounts Receivable, Balance Sheet, Forensic Accounting, Fundamental Analysis

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aging

A technique for evaluating the composition of a firm's accounts receivables to determine whether irregularities exist. It is carried out by grouping a firm's accounts receivables according to the length of time accounts have been outstanding. For example, a financial analyst may use aging to determine whether a firm carries many overdue debtors that may never pay their bills.