A high DSO may lead to cash flow problems in the long run. If you don't receive the email, be sure to check your spam folder before requesting the files again. Calculate the receivables turnover ratio. Instead of looking at your income from month to month, you look at the average of the last 12 months as of today. Rolling 12 Month Period means, as of the end of any month during the CGS Term, the twelve (12)-month period that includes such month and the preceding eleven (11) months that occurred during the CGS Term, WebView the total DSO figure on the KPI tile, for the last 12 months ending today. Thank you. DSO Calculation. DSO is often determined on a monthly, quarterly, or annual basis. DSO is often determined on a monthly, quarterly, or annual basis. Here is how Investopedia recommends calculating DSO: Accounts Receivable DIVIDED BY Total Credit Sales TIMES Number of Days [in the timeframe examined] For example, lets say at the end of July you have $600,000 that customers owe you. The average between $25,000 and $20,000 is $22,500, so this is your Average A/R. And, lets say the customer requests terms of net 60.. 2 Months Ago: $2,000,000 To calculate the traditional DSO for both companies, divide $7,000,000 by the average daily sales for the last 12 months of $100,000. A/R balance at end of current month: $7,000,000 Here, we only have a single data point to work with (2020 DSO = 55 days), but for modeling on the job, it is ideal to take a close look at historical trends over multiple years. WebDays Sales Outstanding Formula. Step 1. Contact us if we can be of any encouragement to you. This enables continuous planning of future performance based on actual performance. Thank you very much for your discussion above. SELECT * from table where customer = current_row customer and yearmonth >= current month - 12 and yearmonth