How debts age

Ageing methods

There are six different ageing methods that you can use:

• ageing from the statement date by:
  
  - month
  - days
  
  
• ageing from the statement due date by:
  
  - month
  - days
  
  
• ageing from the transaction date by:
  
  - month
  - days.

Note: You can change the ageing method at any time. See Synergetic Financial Configuration - Debtors tab in the Finance manual.

The method of ageing you choose depends on your organisation's debt control policy.

It is most common to apply ageing from the statement date rather than the transaction date. This is because the first time that the debtor is aware of what they owe is when they receive the statement.

You may also want to apply ageing from a statement due date instead of the statement issue date. If no due date has been set for a statement, Synergetic uses the statement issue date instead.

If you are ageing debts by month, Synergetic only looks at the month component of the date. This method is less accurate than using daily ageing but it is easier to understand.

Tip: We recommend you print statements at the beginning of the month because the debt ages at the end of the month.

Examples of ageing

1. Monthly from the statement date:

Charge:2/9/07$50
Charge:25/9/07$60

Statement sent on 1/10/07:

Charge:10/10/07$25

Statement sent on 1/11/07:

(assuming no receipts or credits)

2. Monthly from the transaction date:

Charge:2/9/07$50
Charge:25/9/07$60

Statement sent on 1/10/07:

Charge:10/10/07$25

Statement sent on 1/11/07:

(assuming no receipts or credits)

3. Monthly from the statement due date:

Charge:2/9/07$50
Charge:25/9/07$60
Statement sent on 1/09/07

Statement due on 1/10/07:

Charge:10/10/07$25
Statement sent on 1/10/07

Statement due on 1/11/07:

(assuming no receipts or credits)