The weekly AR aging checklist

How to use this checklist

Pick one time each week, for example Monday at 9am, and block 20 minutes. Run the routine below, send the emails that are due, and fill in one row of the tracker on the last page. The routine works in any accounting system that can run an AR aging report: QuickBooks, Xero, NetSuite, Sage or a spreadsheet.

1. The 20-minute weekly routine

2. What to look at in the aging report

• Total AR and how it splits across current, 1–30, 31–60, 61–90 and 90+ days past due.
• Share over 60 days (61–90 plus 90+, divided by total AR). Watch the trend over four weeks, not one week on its own. If it climbs three weeks running, something has slipped.
• Who just moved bucket. Customers who crossed into 31–60 or 61–90 this week are the ones to act on now, while they’re still easy to collect.
• Your ten biggest overdue balances. If one or two customers make up most of what’s overdue, they get a phone call, not just an email.
• Unapplied payments and credits (negative balances). These make the report wrong and lead to embarrassing reminders.
• Missing or bounced contact details. An invoice sent to someone who left the company will never get paid on its own.
• Optional, monthly: DSO (days sales outstanding). Total AR ÷ sales for the last 90 days × 90. It tells you, on average, how many days it takes to get paid. Track the direction, not the exact number.

3. The follow-up schedule

Days are counted from the invoice due date. Move each overdue invoice one stage at a time, and stop as soon as it’s paid, disputed (see section 5) or has a written promise to pay.

Only mention late fees or interest if they’re in your signed terms, and check your state’s rules before charging them.

4. Reminder emails to copy

Replace the words in [brackets]. Send each one as a reply to the previous email, so the whole history stays in one thread.

Day 1: friendly nudge

Day 7: check it arrived

Day 14: ask for a date

Day 30: firm

Day 45: second contact, payment plan

Day 60: final notice

Day 90: formal last chance

Only name a next step you’re actually prepared to take, and on the date you said.

5. Disputes and short pays

When a customer disputes an invoice

• Stop the reminder schedule for the disputed part only. Mark the invoice “in dispute” with the date and the reason.
• Split the disputed amount from the undisputed amount, and ask for the undisputed part to be paid now.
• Reply within two business days, even if it’s only to say you’re looking into it.
• Get the facts: the quote or PO, the delivery note or timesheet, and any emails about the work.
• If they’re right, send a corrected invoice or a credit memo and restart the schedule from the new due date.
• If they’re not, explain why in writing, attach the evidence, and give a payment date.

When a customer pays less than the invoice (a short pay)

• Find the remittance advice (the note that came with the payment). It often says why.
• Common reasons: an early-payment discount taken late, a bank or card fee deducted, one line they think was wrong, or a simple keying mistake.
• Apply what was paid to the invoice, leave the difference open, and note the reason.
• If the difference is smaller than the cost of chasing it, decide whether to write it off. Keep a note so it doesn’t become a habit for that customer.
• Otherwise, ask about it straight away, while everyone still remembers the payment.

6. When to stop and escalate

Escalate when any one of these is true:

• No reply after three attempts across at least two channels (email and phone).
• Two broken promises to pay.
• The invoice is over 60 days past due and not in dispute.
• The customer goes silent, changes ownership, or you hear they’re in financial trouble.
• The balance is bigger than you can afford to lose. Pick that number now, so you don’t argue with yourself later.

The escalation ladder

1. Call the decision maker, not your usual contact: the owner, controller or AP manager.
2. Agree a payment plan in writing, with dates and amounts.
3. Pause new work or orders for the account, if your terms allow it.
4. Send a formal demand letter (the day 90 email, on letterhead, by email and mail).
5. Refer it to a collections agency. Most work on contingency, keeping a share of what they recover, so compare their terms first.
6. Small claims court or an attorney. Small claims limits vary by state. For larger balances, talk to an attorney about whether it’s worth pursuing.

When to stop

Stop chasing when collecting would cost more than the balance, the customer has closed, or you have no realistic way to reach them. Write it off in your books and ask your accountant how to treat it for tax. Then add the customer to a “prepay only” list.

7. One-page weekly tracker

This week’s numbers

Accounts to chase

Stages: D1, D7, D14, D30, D45, D60, D90. Mark disputes with a D and the date.