The numbers your board asks about
Receivables management and finance
DSO, recovery rate, aged debtor listings and provisions. The language your finance function uses internally for the very things the collections department calls something else.
10 concepts
- Aged debtors report (aldersfordelt saldoliste) The aged debtors report shows your outstanding receivables broken down by how long they have been overdue. Outstanding amounts per age bracket shows
- Bad debt ratio (tabsprocent) The bad debt ratio is the share of revenue that ends up as realised losses on the debtor ledger. Losses as a percentage of revenue measures
- DSO DSO (Days Sales Outstanding) is the average number of days from the moment you invoice until the money is in the bank. Days from invoice to payment measures
- No cure no pay No cure no pay means that the collection agency is only paid if the claim is recovered — typically as a percentage of the amount collected. Only on recovery payment
- Provision for bad debt (hensættelse til tab) A provision for bad debt is the accounting reserve for the loss you expect on your receivables — before it has been realised. An expected loss, not a realised one is
- Receivables management (debitorstyring) Receivables management is the end-to-end control of outstanding invoices — from invoice to payment, reminder or debt collection. DSO and write-off rate measured on
- Recovery rate (inddrivelsesgrad) The recovery rate is the share of the claims handed over that is actually paid. Paid claims as a % of those handed over measures
- Reminder cadence (rykkerkadence) The reminder cadence is the fixed rhythm your reminders go out in — who is chased when, and what happens once the deadline has passed. 10 days between each reminder minimum
- SLA in debt collection An SLA is the agreed service framework for the collection work — response times, case handling times and reporting.
- Write-off (afskrivning) A write-off is the accounting recognition that a claim is lost — but it does not extinguish the legal claim. An accounting entry is
And what applies all the way through
From dictionary to decision
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