Accounts Receivable (A/R) Aging Summary Analysis

Executive Summary

This report analyzes the company's Accounts Receivable Aging Summary as of June 21, 2025. The aging summary provides insight into outstanding customer balances, categorized by length of time an invoice has been outstanding. This helps assess overall receivables health, collection efficiency, potential risks and cash flow outlook.

A/R Aging Breakdown

Aging Category	Amount Outstanding	% of Total Receivables
Current	$2,963,719.54	~73.73%
31–60 Days Past Due	$552,259.37	~13.75%
61–90 Days Past Due	$215,461.92	~5.36%
>90 Days Past Due	$269,539.69	~6.70%
TOTAL	$4,001,480.52	100%

*Totals above are approximate and based on summing column values in this report.

Key Financial Ratios / KPIs

Ratio / KPI	Value*	Description & Interpretation
Days Sales Outstanding (DSO)	54 days^†	Indicates, on average, how many days it takes to collect receivables. Lower is better. Target usually < 45 days for many industries.
% Current Receivables	73.7%	Percentage of A/R that is not yet overdue. Higher means better payment timeliness.
% >60 Days Past Due	~12%	Portion of receivables overdue more than 60 days. Should be closely monitored. <10% is generally healthy.
Top 5 Customers' A/R	$2,159,610.30	~54% of Total A/R is due from five customers. Indicates customer concentration risk.

*Values are approximate, given available data.
^†Estimated assuming annual revenue of $27 million (not provided; see note below).

Financial Health Assessment

General Condition: The company has a strong proportion of current receivables (73.7%), which suggests many customers are paying on time. However, ~12% of A/R is more than 60 days overdue, which may impact cash flow and increase bad debt risk.
Customer Concentration Risk: The five largest customers account for over 50% of A/R. Dependence on a small group of customers could significantly affect cash flow if one or more delay payments or default.
Credit Risk: Notables such as "Bosch, München" ($148.8K), "Karstadt Quelle" ($568.5K), and "ALK-Abelló" ($593.1K) have large outstandings. While some are current, close monitoring of these accounts is essential due to their material impact.
Anomalies/Concern:
- BASF, Düsseldorf and BMW, München are shown with large negative total balances (BASF: -$38K, BMW: -$69.7K). This might mean overpayments, credits, or data errors, and should be investigated.
- Davis Supplies is showing a negative A/R balance of -$210.4K in total. This is unusual and may indicate prepayment, data entry error, or a refund/credit owed.
Bad Debts: Several customers have all or a part of their balances aging into the 61–90, or >90 days columns, notably: "Motiva Mobility" ($112.5K at 90 days), "Office Refurbishment" ($255.8K over 90 days), and "Andy Burkston" ($22.9K at 61–90 days).

Customers/Transactions of Interest or Concern

Large (Over $200,000) Exposures
- ALK-Abelló: $593,103.29 (almost all current)
- Karstadt Quelle: $568,457.09 (almost all current)
- Keller Supply: $433,750.00 (all current)
- Novo, Denmark: $303,160.03 (almost all current)
- Office Refurbishment: $255,800.00 (>90 days overdue!)
Potential Problem Accounts
- Motiva Mobility: All $112,545.00 is 90 days overdue.
- Office Refurbishment: All $255,800 is >90 days overdue.
- Andy Burkston, Airport Furniture Store, Bobby O'Mara: All A/R in the 61–90 day column (>$17K & $22K each).
- BASF, BMW, Davis Supplies: Large negative A/R balances — confirming root cause may reveal cash inflow, need for customer refund, or error.
Customer/Project Groups
- Groupings such as Mind the Gap Clothing, Pineapple Republic, and Bay Media Research aggregate large exposures. Grouping A/R can reveal potential risk clusters.

Trends, Anomalies and Risks

Roughly 6.7% ($269K) of receivables are >90 days overdue; industry best practice is to keep this under 5%.
Multiple significant customers have substantial overdue sums (>60 days) — this could indicate either customer financial stress or invoicing/collection inefficiency.
Three customers have negative total balances, suggesting data inaccuracies, unapplied credits, or overpayments; these require prompt investigation.
Certain customers (Office Refurbishment, Motiva Mobility) have all A/R in overdue columns, increasing the likelihood of write-offs.
Customer concentration is high (top five = >54% of A/R), increasing risk from any payment delays among these accounts.

Actionable Insights & Recommendations

Pursue Aggressive Collections: Proactively follow up on >90 days overdue accounts, especially "Office Refurbishment" and "Motiva Mobility". Consider placing holds or adjusting credit terms for these customers.
Investigate Negative Balances: Review BASF, BMW, and Davis Supplies for data errors, over-payments, or the need for customer refunds.
Monitor Top Customers: Tighten credit review and monitoring on ALK-Abelló, Karstadt Quelle, Keller Supply, and Novo, Denmark, due to their large balances.
Review Customer Concentration: Diversify customer base to reduce financial exposure from a handful of clients.
Enhance Credit & Billing Processes: Expedite invoice delivery, clarify terms, and automate reminders for customers trending toward overdue status.

A/R Portfolio Visualizations

If you need projected cash flow impact, bad-debt allowance calculation, or benchmarking to industry peers, supplementary data will be required.
This review is based solely on data available in the presented A/R Aging Report.