The average time from a receivables due date to its paid date
1. Calculate average Days Sales Outstanding (DSO)
DSO = (Average AR / Total Credit Sales) x Number of Days
2. Calculate Best Possible DSO
Best Possible DSO = (Current AR / Total Credit Sales) x Number of Days
3. Calculate Average Days Delinquent
ADD = Days Sales Outstanding – Best Possible Days Sales Outstanding
HighRadius Collections Software automates and optimizes the credit & collections management process to improve collector efficiency, minimize bad debt write-offs, improve customer relationships, and reduce DSO. It provides a complete set of tools to optimize and automate the credit collections management process and enable the better prioritization of credit collections activities All the information you need (invoices, dispute information, POD, claims, tracking info, etc.) on each case is automatically presented in a collections work-space and is ready for use. Apart from the wide variety of benefits that it has, it also comes with some amazing features like CADE (Collection Agency Data Exchange), collector's dashboard which has prioritized collections worklist, automated dunning & correspondence, dispute management, centralized tracking of notes, call logs & payment commitments along with cash forecasting functionalities. The result is a more efficient collections team that contributes to enhanced cash flow and reduced DSO.
