Accounts Payable & Receivable Advanced Flashcards
6 cards from real AAT L3 practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Accounts Payable & Receivable Advanced flashcards as text
The aged receivables report is used to:
Answer: Identify how long customer invoices have been outstanding, aiding credit control
An aged receivables (debtors) report categorises outstanding customer invoices by age (e.g., 0–30 days, 31–60 days, 61–90 days, over 90 days), helping the credit control team prioritise collection activity.
A statement of account sent to a customer is used to:
Answer: Confirm the balance owed by the customer, listing all invoices, payments, and credits
A statement of account summarises all transactions between the business and the customer — invoices raised, payments received, and credit notes issued — confirming the net outstanding balance due.
A credit limit for a customer should be set based on:
Answer: An assessment of the customer's creditworthiness, payment history, and financial position
Credit limits should reflect the customer's ability to pay — assessed using credit references, payment history, financial statements, and credit agency reports — to manage the risk of bad debts.
When a supplier sends a statement of account, the purchase ledger team should:
Answer: Reconcile it against the purchase ledger to identify discrepancies
Supplier statement reconciliation is an important internal control; by comparing the supplier's statement to the purchase ledger, the team can identify invoices not yet posted, disputed items, or timing differences.
Which document authorises the payment of a purchase invoice?
Answer: Authorised payment schedule or approved purchase invoice
Before paying a supplier, the invoice should be matched against the purchase order and goods received note (three-way match), then formally approved/authorised by an appropriate manager before payment is processed.
The purpose of a remittance advice sent to a supplier is to:
Answer: Inform the supplier which invoices and credit notes are included in a payment
A remittance advice accompanies (or is sent alongside) a payment, listing the invoices being settled, any credit notes offset, and discounts taken — helping the supplier allocate the payment correctly in their ledger.