The Debtors Turnover Ratio, also known as Accounts Receivable Turnover Ratio, is a financial metric used to measure the efficiency of how quickly a company collects cash from its debtors. This ratio shows the number of times that a company can collect its accounts receivables during an accounting period. A high Debtors Turnover Ratio means more frequent and prompt payments by customers, whereas a low Debtors Turnover Ratio indicates slow or late payments. It is an important indicator of a company’s credit management and collection policies. To calculate this ratio, divide net credit sales by average debtors over the year. By monitoring the Debtors Turnover Ratio of your business, you can determine the effectiveness of your credit control policy and ensure that customer payments are being collected on time.