Aged receivables over 90 days: the aging cutoff rule

Collection odds fall off a cliff with age. An invoice that is 30 days old is a receivable. An invoice that is 130 days old is a negotiation. Lenders have decades of loss data showing that once an invoice crosses roughly 90 days, the probability of full payment drops sharply, so the cutoff is where the collateral stops being treated as near cash.

Most agreements measure age one of two ways: 90 days from invoice date, or 60 days from due date. The distinction matters a lot if you offer extended terms. An invoice with net 75 terms can be completely current and still fail a 90 days from invoice date test. Which convention applies, and whether extended terms invoices get carved out, comes from your agreement.

The test is invoice by invoice. Take the report date, compute each invoice's age under the facility's convention, and exclude anything past the cutoff. Here is a four invoice slice tested on June 30, 2026 under a cutoff of 90 days from invoice date.

The two failed invoices remove $365,000 from eligible receivables. At an 85 percent advance rate, that is $310,250 of availability gone. And the effect compounds: aged invoices also feed the cross-aging test, which can take out the same customer's current invoices too.

The inputs look trivial: invoice date, due date, open amount, and the report date. In practice this is where certificates go wrong. Due dates are missing or defaulted in the ERP, so a 60 days from due date test silently falls back to bad assumptions. Reissued or corrected invoices carry a fresh invoice date that resets the clock, which field examiners specifically look for. And unapplied cash or credit memos sitting in old buckets make balances look aged when they are actually paid.

The open amount matters as much as the date. Testing gross invoice amounts instead of open balances overstates ineligibles; testing a stale AR extract understates them. The aging has to be cut from the same ledger snapshot as the rest of the certificate.

• The cutoff is applied deterministically: the same ledger snapshot and the same rule always produce the same list of aged invoices.
• Each facility is configured with its own convention, whether that is 90 days from invoice date, 60 days from due date, or a negotiated variant for extended terms.
• Every excluded invoice traces back to its source row, invoice date, due date, and computed age, so the aged ineligible line on the certificate is explainable invoice by invoice.
• Suspicious patterns, like reissued invoices with reset dates, are surfaced before they become a field exam finding.