AR Accounts Receivables Aging

Managing Accounts Receivables (AR) aging involves tracking and reconciling payments received from invoices, FedNow, and RTP while ensuring accurate matching, merging, and clearing of transactions. Here's a step-by-step guide on how to handle AR aging using these processes:

1. Invoice Generation and Payment Recording:

1. Invoice Generation:

• Generate and send invoices to customers using your accounting software.

2. Payment Recording:

• Record payments received from various sources (invoices, FedNow, RTP) in your accounting system. Ensure accurate entry of payment details (amount, date, etc.).

2. Matching Invoices and Payments:

3. Matching in QBO:

• Use QuickBooks Online (QBO) features to match payments with corresponding invoices. QBO typically has a built-in matching process that uses criteria like invoice numbers, customer names, or amounts.

4. Excel Matching:

• If needed, use Excel's MATCH function to manually match payments with invoices based on common identifiers.

3. Merging Information:

5. Data Collection:

• Collect payment data from FedNow, RTP, and any other sources.

6. Normalization:

• Ensure that data from different sources is in a consistent format.

7. Merging:

• Merge data from FedNow, RTP, and other sources with your QBO data. Use Excel or other tools to align and combine information based on common identifiers.

4. Clearing Transactions:

8. Reconciliation:

• Regularly reconcile bank statements, QBO records, and external payment data to identify discrepancies.

9. Clearing in QBO:

• Use QBO's reconciliation feature to clear transactions, indicating that they've been verified against bank statements.

5. AR Aging Analysis:

10. Aging Categories:

• Set up aging categories such as "Current," "1-30 Days," "31-60 Days," etc., based on due dates.

11. Calculate Days Overdue:

• Calculate the days overdue for each invoice using the due date and current date in Excel.

12. Categorize Aging:

• Use formulas to categorize invoices into aging buckets based on the number of days overdue.

6. Automation and Tools:

13. Automation in QBO:

• Explore QBO's automation features, including rules and batch transactions, to streamline the matching and clearing processes.

14. Integration with FedNow and RTP:

• If possible, integrate QBO directly with FedNow and RTP for real-time updates and reduced manual intervention.

7. Regular Reconciliation and Documentation:

15. Regular Reconciliation:

• Conduct regular reconciliations to ensure accuracy between QBO, bank statements, and external payment sources.

16. Documentation:

• Maintain clear documentation of reconciliations, adjustments, and any discrepancies for audit purposes.

By following these steps, you can effectively manage AR aging using the processes of matching, merging, and clearing transactions when receiving funds from various sources. Always refer to the latest documentation and support resources provided by QBO for any specific features or updates related to reconciliation processes.