Start with the transaction sequence
Assume a customer has an opening balance of PKR 15,000, then receives an invoice for PKR 42,500. A later receipt of PKR 25,000 should reduce the oldest outstanding balance first under a FIFO approach.
That receipt clears the PKR 15,000 opening balance and applies the remaining PKR 10,000 against the PKR 42,500 invoice. The invoice therefore still has PKR 32,500 outstanding.
Add credit days
If the invoice date is 5 January and the agreed credit period is 45 days, its due date is calculated from those inputs. Aging should be measured against the remaining unpaid amount, not against the original invoice value after receipts have already been allocated.
Later receipts continue to clear the oldest outstanding eligible balances first. This produces a sequence of partially or fully settled invoices.
Why opening balances and adjustments need review
Opening balances may represent several older invoices rather than one transaction. Credit notes, returns and manual adjustments can also change how a business expects payments to be matched.
FileFiddler provides a practical FIFO result based on the ledger rows it can read. If your accounting policy allocates payments by reference number, contract, branch or another rule, the FIFO result may differ from your books.
What to verify before relying on an aging result
Aging is useful for collection follow-up and reconciliation, but unusual ledgers should be reviewed before the result is treated as an accounting record.
- Transaction dates are interpreted correctly.
- Debit and credit signs match the customer or supplier mode.
- Opening balances are understood.
- Credit notes and reversals are represented correctly.
- Credit days match the commercial agreement.
Related FileFiddler tools
About this guide
This guide documents how FileFiddler approaches the underlying file problem, including limitations that matter when you review the output. It is maintained alongside the tools rather than written as generic promotional content.