An aged trial balance (ATB) — also called an accounts-receivable (AR) aging report — is a finance document that lists every outstanding customer invoice by age bucket: current (0–30 days), 31–60 days, 61–90 days, and 90+ days past due. For MCA advances above roughly $100K–$150K, funders pair the ATB against bank statements to verify that deposits represent real billed-and-collected business revenue.
Why the ATB matters for larger advances.
Below $100K, MCA underwriting is bank-statement-only. Above $100K, the file size justifies additional document review, and the funder wants confirmation that:
- Deposits trace to real invoices. If the merchant claims $80,000/month revenue but the ATB shows $30,000/month billed, the bank-statement deposits are not what they appear.
- Customer concentration is acceptable. A merchant with 70% of revenue from one customer is a concentration risk — that customer leaving kills the cash-flow that repays the MCA.
- Aging quality is healthy. High percentage in 90+ days past due signals deteriorating collections; future deposits will likely be lower than past deposits.
- No fictitious revenue. Cross-reference bank deposits to ATB closures (customer payments mark invoices as paid). Fictitious deposits have no offsetting ATB entry.
Standard ATB review workflow.
- Funder requests ATB report. Pulled from QuickBooks, Xero, NetSuite, FreshBooks, or other accounting system.
- Funder cross-references bank deposits to ATB activity. Each month's deposits should match each month's collections.
- Concentration analysis. Top-5 customer revenue as % of total. Anything over 50% triggers concentration flag.
- Aging-quality analysis. Distribution across age buckets.
- Trend in aging quality. Worsening aging (more in 90+) signals customer-payment slowdown.
Standard 2026 aging-quality benchmarks.
- Current (0–30 days): 70%+ of AR. Healthy; A-paper.
- 31–60 days: 15–20% of AR. Normal.
- 61–90 days: 5–10% of AR. Mild concern; some industries (construction, healthcare) normal here.
- 90+ days past due: under 5% of AR for healthy file; 10%+ is a flag; 20%+ is severe.
Customer concentration tiers.
- No customer over 15% of AR. Diversified; A-paper preferred.
- One customer 15–30% of AR. Standard; common in B2B services.
- One customer 30–50% of AR. Concentration flag; funder will request customer-payment history.
- One customer over 50% of AR. Major concentration risk; advance capped or declined.
- Top 3 customers over 70% of AR. Heavy concentration; advance heavily discounted.
Industry-specific aging norms.
- Construction. 60-90 day aging is normal due to progress-payment schedules.
- Healthcare. 90+ days normal because insurance reimbursement is slow.
- Manufacturing. 30-60 day aging is normal; net-30 to net-60 terms.
- Retail / e-commerce. Aging should be near zero — sales are paid at point of transaction.
- Restaurants. Aging should be near zero — daily card and cash settlement.
- Professional services. 0-30 day aging healthy; 60+ day signals slow collections.
Red flags in ATB review.
- Fictitious customers. Customer names that do not exist when funder searches.
- Dramatic aging shift since previous review. Sudden growth in 90+ bucket indicates customer-payment problem.
- Bank deposits without offsetting ATB closures. Money in but no invoice paid — fictitious deposit suspicion.
- ATB invoices with no offsetting bank deposit. Invoices marked paid but no money in account — accounting error or fraud.
- Concentration in customers also funded by the same MCA funder. Concentration risk that the funder cannot diversify around.
When ATB is not requested.
- Card-heavy retail and restaurants. ATB is trivially small because sales are paid at point of transaction. Funder skips and relies on bank + processor data.
- Cash-business merchants. ATB has no meaningful entries.
- Sub-$100K advances. ATB review cost exceeds value; bank-statement-only underwriting.
Documentation standard.
Funders accept ATB pulled directly from accounting software (preferred — uneditable export) or signed and dated PDF from merchant. Hand-prepared spreadsheets are scrutinized for plausibility.
Takeaway. For advances above $100K–$150K, funders pair the aged trial balance with bank statements to confirm deposits trace to real billed invoices, identify customer concentration, and check aging quality. Healthy ATB shows 70%+ current, under 5% in 90+ days past due, and no customer over 30% of receivables. Construction and healthcare are exceptions with naturally longer aging. ATB review is the bridge between bank-statement-only MCA and SBA-style cash-flow lending.
Related terms
- MCA funder bank-statement deposit classification (2026) — Funders classify every bank-statement deposit into revenue, transfers, loans, refunds, owner contributions, and one-time items — only the revenue bucket counts toward underwriting volume. Updated 2026-06-28.
- MCA funder bank-statement revenue vs deposit distinction (2026) — Revenue is operating cash from real customers; deposits are every credit hitting the account including transfers and loans — funders underwrite revenue, not deposits. Updated 2026-06-28.
- Bank statement underwriting — MCA funders underwrite primarily off 3–6 months of business bank statements, not credit reports. They look at average deposits, NSFs, negative days, and trend.
- MCA funder bank-statement loan payment detection (2026) — Funders detect existing loan payments — SBA, bank term, equipment, line-of-credit — from bank-statement debits to calculate total debt service and remaining cash-flow capacity. Updated 2026-06-28.
- MCA funder bank-statement related-party detection (2026) — Funders detect deposits and debits with owner-controlled entities, family members, and related businesses — related-party flows are excluded from revenue and signal financial obfuscation risk. Updated 2026-06-28.
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