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The process of investigating a company's accounts receivable according to how long individual invoices have been outstanding. Analysts can use aging to identify bad debt and/or problems with the company's credit policy.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
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.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.