For many businesses, the idea of extending credit to potential customers all the way in European countries is a daunting task. It’s much easier for a customer in a far-away country to ignore your requests for payment than for a customer in the same country as you, right? Well, that isn’t entirely true. In fact,
- Days Sales Outstanding is not a clear indicator of how the entire accounts receivable team is doing on collections. Since DSO relies on total sales for the time period in question, the final DSO can be skewed. If a business using the calculation relies on a highly seasonal sales cycle, DSO will not be indicative
Days Sales Outstanding, or DSO, is commonly used as a benchmark to the efficiency and effectiveness of the accounts receivable department. Especially when management reports are created, CFOs, CEOs and owners are looking towards this key metrics to decide whether the accounts receivable department is doing their job well. Unfortunately for the AR department, this
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