Days Sales Outstanding based on Annual Sales

The Days Sales Outstanding based on Annual Sales report utilizes a spline chart to display the Days Sales Outstanding (DSO) and Best Possible DSO (BPDSO) calculated using the following formulas.

  • DSO = ((Total AR at the end of the month )/(Credit sales in preceding 12 months)*365)

  • BPDSO = ((Total Current AR at the end of the month)/(Credit sales in preceding 12 months)*365)

The following are the features and uses of DSO.

  • Measures the average days required for a sale to convert into cash.

  • Represents the time taken by customers to pay cash.

  • DSO not only measures the time in which the AR will be paid off, but also measures the liquidity on hand.

  • Helps in understanding the financial health.

Note

The calculation constraints in the report are as follows:

  • Only debit invoices and the invoice amount are considered.

  • Monthly credit sales represents the money made by sales in a particular month.

  • Credit sales in preceding 12 months is total invoice amount generated in last 12 months.

  • Total AR at the end of the month = Total open invoice amount at the last day of month (document date <= end of the month, clearing_date >= end of the month)

  • Total Current AR at the end of the month = Total open current invoice amount at the last day of month (Document date <= end of the month, clearing_date >= end of the month, due date >= end of the month)

The description of axes and series in the report are as follows:

  • X-axis - Month and Year

  • Y-axis - DSO values

  • Blue series - BPDSO

  • Orange series - DSO

Note

By default, both series are displayed. Clicking a legend at bottom of the graph enables or disables that series.

Tooltip - Hovering over a point in the series displays a tooltip of the date and the respective BPDSO and DSO values based on the selected filters.

Out-of-the-Box Features

The Out-of-the-Box features and functionalities of the report are as follows:

  • Standard Out-of-the-Box Filters - Filters the entire report on the basis of Collector, Company Code, Customer Segment, and Owner.

  • Date Range - Filters the data displayed in the report as per the required date range. The maximum time period selection is 24 months and the minimum is one month.

  • Kebab Menu - Click this icon to access options such as download, schedule, and mark the report as favorite. For more details, refer to Using Kebab Menu Options.