oboloo Glossary

Accounts Receivable Turns

oboloo Glossary

Accounts Receivable Turns

Accounts receivable turns is an important metric that measures the efficiency of a company’s credit policy. It looks at the number of times that a business collects its accounts receivable (money owed to it) during a given period, typically twelve months. In other words, it tells you how quickly money coming into your business can be collected and turned into cash. The higher the turn rate, the more efficient the collection process. A lower turn rate might indicate that customers aren’t paying in a timely manner, or that there are problems with the billing process that need to be addressed. It’s important to keep an eye on this metric to ensure that your businesses cash flow remains steady.