Aged Debtor Analysis & Financial Recommendations for Excel

This report provides an analysis of an aged debtor report for a company, identifying key issues related to overdue payments from clients. It highlights problems such as clients not paying within the specified timeframes and the potential dissatisfaction with interest charges on overdue amounts. The report calculates the financial impact of these delays, considering interest rates applied at different stages (60-90 days, 90-120 days, and beyond). Recommendations include conducting credit checks on potential customers to assess their creditworthiness, implementing a system for issuing timely notices and demand letters for payments, and closely monitoring clients' financial situations to proactively address potential payment difficulties. The conclusion emphasizes the importance of addressing these issues to improve the company's financial health and client relationships. Desklib provides a platform to explore similar solved assignments and past papers.

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Contents
INTRODUCTION......................................................................................................................3
MAIN BODY.............................................................................................................................3
1. Take a review of the aged debtor report and summarise it by identify the issues within
the fiscal report.......................................................................................................................3
2. Analyse the issue with the process of aged debtor of the company...................................3
Recommendations..................................................................................................................4
CONCLUSION..........................................................................................................................5
REFERENCES...........................................................................................................................6

INTRODUCTION
Aged debtor report is defined as the quantitative measurement of the due which are
owned by the business organisations (O'Brien, Anderson and Ramsay, 2020). In the report,
the analysis of the debtor’s report is made and the issues and recommendation are made the
basis of the reports.
MAIN BODY
1. Take a review of the aged debtor report and summarise it by identify the issues within the
fiscal report.
As can be analysed from the table, it can be reviewed that the aged debtor report has 3
clients. Client 1 has a debt of $4356 for 90 days, client 2 has 120 days’ debt for $ 2714 and
client 3 has $ 3781 for 60 days. The issue is regarding the payment of the amount that id
owed by the company to its debtors. None of the debtors are paid off their amount in the
period of 10 days.
2. Analyse the issue with the process of aged debtor of the company.
The table of aged debtor’s showcases that the clients are not satisfied with the
condition of the payment of fees paid to time them on the specific time period. These are the
top 3 clients of the organisation and they are not being duly paid – off their money from the
time period of the invoice accordingly (Gamble, Gärling and Michaelsen, 2019).
It can be suggested for the old client that the interest charges that are put towards the
debtors does not satiny the condition of tem aunt that has not been paid on time. For this the
analysis that has been done is:
 Assuming in some way the obligation stays neglected for a time period of 60 to 90
days, it will demand an extra 5% interest expense. With an unpaid obligation of $
3,781, Client 3 comes into this classification. The client's cash based cost will be $
3970 assuming that the obligation is paid within this time span.
 If the obligation of debt remains outstanding for a time of 90 to 120 days, it will force
the company with an extra 10% loan cost. With an unresolved debt of $ 4,356, Client
1 comes into this grouping. It the obligation is paid – off in this specified period of
time then the client pocket expense will cost approximately $ 4791.60.
 If the obligation remains unpaid for 60 to 90 days, an additional 5% interest will be
charged. Customer 3 falls into this category because it has an outstanding debt of $

3,781.00. If the debt is settled within this period, the customer's out-of-pocket cost
will be $ 3970.
 If the loan remains unpaid for 120 days or more, we will charge an additional 30%
interest rate. Customer 3 falls into this group with outstanding debt of $ 2,714.00. The
client's out-of-pocket expense will be $3,528.20 if the debt is paid within this time
frame.
 If indeed the debt has still not been settled for 120 days more than 120 days and the
customer chooses to pay in instalments, an additional 2% of the instalment amount
will be charged (West, 2019).
Recommendations
1. Conduct a credit check of potential customers: By giving credit checks, it will help
the excel consultants to perform better in financial terms. It assists in maintaining the
fiscal status of the company and what amount the company is holding as a liability
can also be known through the credit check. It will enhance the efficiency of the
organisation and help in gaining new consumers, by assuring them a creditworthiness
for the payments. It also measures the debt level and helps in making and collecting
timely payments and amounts. It helps in monitoring the performance as well as
makes the decision making stronger by modifying the payment terms and conditions.
2. Access the documents of the debt collection for issuing notices and demand letter
for completing the payments: It is very essential for the organisation to give notice
to their creditors so that the payment can be made on the timely basis. To resolve
these issues, proper communication channel should also be made by the firm which
will help in signifying the relationship between the firma and its clients.
3. Alerted about the financial difficult if faced by the client: The organisation should
monitor the monetary status of the client, so that it will enable the firm to collect the
amount on time. If the firm is not stable in monetary terms that the organisation
should demand a security so that its funds are not stopped and payment could be made
by the client.

CONCLUSION
The above report asserts that the issue which the aged debtor report shows is f the
days and the interest rate on the loan amount taken Fr this certain recommendations are made
to solve those challenges.

REFERENCES
Books and Journals
O'Brien, L., Anderson, M. and Ramsay, I., 2020. The Geography of Bankruptcy in
Australia. Am. Bankr. Inst. L. Rev., 28, p.303.
Gamble, A., Gärling, T. and Michaelsen, P., 2019. Young adults’ attitudes toward borrowing.
In Indebtedness in Early Adulthood (pp. 65-87). Palgrave Macmillan, Cham.
West, T., 2019. Gender Issues in Income-Contingent Student Loans: Do Women
Benefit?. Available at SSRN 3404747.