The study from the University of Waterloo in Canada found that seniors have a harder time distinguishing the order of events than younger adults.
When researchers presented them with both a light and sound at the same or different times, they found that young and older adults could determine whether they occurred simultaneously with similar accuracy.
However, when asked to determine which appeared first, the light or the sound, older adults performed much worse.
"Older adults often experience problems processing multisensory information, which in turn can affect everyday tasks from following conversations, to driving, to maintaining balance," said Barnett-Cowan.
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In another test, researchers showed the study participants two lights travelling towards one another.
Usually the lights appear to stream past each other, but when a sound occurs close to when the lights touch, they seem to bounce off each other.
This is the first study to test multiple ways in which younger and older people combine sensory information in time.
The findings provide new hope that by strengthening the link between these brain processes as people age, the impairments in distinguishing the order of events and perceived collisions could reduce.
Possible solutions for improving impaired perceptions of time in the older adults could come from training using video games or brain stimulation.
"But these interventions don't help with changes in the brain's ability to combine sensory information," said Barnett-Cowan.
"If we can identify and address impaired timing of events in the elderly, we could potentially improve the quality of life, safety and independence for many older people," he said.
The study was published in the journal Experimental Brain Research.