The AR Turnover Ratio is an important metric used to measure a business’s ability to efficiently manage its accounts receivables. It compares the total amount of money owed from customer payments to the average amount of money associated with those payments over a set period of time, typically a year. The AR Turnover Ratio aims to gauge the quality and speed of a business’s collection process, and serves as an indicator of its overall financial health. By monitoring its AR Turnover Ratio, a business can make informed decisions regarding how it manages accounts receivable, allocating resources and implementing strategies for improved cash flow.