Aged receivables: the report to check every week
Invoicing is not the same as getting paid. How to read the aged receivables report, why it deserves a weekly look and how to turn it into concrete action.
Invoicing · 4 min read
With SDI, an inaccurate invoice never reaches the customer and never gets paid. Which errors cause rejections, how to prevent them before sending, and how to keep notifications under control.
With Italian e-invoicing, every invoice passes through the Exchange System (SDI) before it reaches the customer. SDI checks the file, verifies that the essential data is consistent and only then delivers it to the recipient, sending the issuer a notification with the outcome. It makes the process more orderly, but it leaves no room for the approximations that paper used to tolerate.
When the check fails, a rejection notice comes back and the invoice is treated as never issued. It has to be corrected and resent within the prescribed time, and in the meantime the customer cannot see it: the countdown to payment has not even started. For a finance team that issues many documents, a handful of recurring rejections is enough to cause delays nobody had planned for.
Most rejections stem from a few recurring mistakes. An invalid VAT number or tax code, often inherited from customer records nobody ever checked. Totals that do not add up because of rounding on lines with many decimals. Exempt or zero-rated transactions without the correct nature code. An invoice sent twice with the same number, perhaps after a first attempt that seemed to have failed.
Then there are problems that do not block the invoice but make it hard to handle. A wrong recipient code or a certified email address that is no longer active leads to a failed delivery: the document is issued, but the customer does not receive it in their own system and will only find it in their private area, if they go looking. Likewise, a missing order reference can stall the invoice in the customer’s approval process, with the same effect as a late payment.
The most effective way to cut rejections is to move the checks upstream. Customer records should be verified when they are created, not when the first invoice bounces back: VAT number, tax code, recipient code or certified email, and any requirement to quote an order number or other references the customer asks for.
It also pays to set clear rules for special cases. Which nature codes to use for exempt or out-of-scope transactions, how to handle stamp duty, how to treat rounding and discounts on the invoice. Writing them down once and applying them automatically stops each person from finding their own solution, with results that differ from one invoice to the next.
Finally, a consistency check just before sending is worth having: sequential numbering with no gaps or duplicates, plausible dates, totals that match the sum of the lines. These checks are trivial for a system, but easy to skip when working under month-end pressure.
Before you send
SDI notifications are valuable information, but only if someone looks at them. Make one named person responsible and plan a daily check of the outcomes: invoices delivered, rejected, not delivered. A rejection spotted on the same day takes minutes to fix; one discovered weeks later, when the customer asks where the invoice has gone, costs far more.
It is also important to tell the cases apart. A rejection means the document must be corrected and resent. A failed delivery does not require a new submission, but it is good practice to let the customer know and send them a copy, otherwise the invoice may well be ignored until the first reminder.
The same applies to payables. Supplier invoices arrive through the same channel and need to be picked up and routed regularly: an invoice that has been received and left in the queue is a due date nobody is watching.
Rejection
Failed delivery
E-invoicing works best when it is not an island. If the invoice is generated from the order or the job, customer data and payment terms arrive already correct; if the SDI outcome updates the payment schedule, the finance team knows at any moment which receivables are really building up and which are stuck.
In Finance, sales and purchase invoices flow through SDI via the integration with intermediaries, and each document shows its status next to the customer, order and due date. Checks on records and totals run before sending, rejections are flagged with their reason, and supplier invoices enter the approval flow linked to purchase orders. SDI stops being a step to keep an eye on and becomes a natural part of the process.
E-invoicing works best when it is not an island, but part of a cycle that runs from order to payment.
Keep reading
Invoicing is not the same as getting paid. How to read the aged receivables report, why it deserves a weekly look and how to turn it into concrete action.
Matching every transaction to its document is the only way to know what has really been paid. A practical method for doing it every day and leaving only the exceptions to your team.
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