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Days Outstanding Accounts Receivable

oboloo Glossary

Days Outstanding Accounts Receivable

Days Outstanding Accounts Receivable (DOAR) is a measure of how long it takes for a business to receive payments for services and goods it has provided. To calculate DOAR, simply divide the total number of days outstanding by the total number of accounts receivable on the books. This figure reveals invaluable insight into the financial health of a company: the longer customers take to pay, the more stress it puts on the business’s cash flow. Keeping a close eye on DOAR can help anticipate potential problems like late payments and bad debts, allowing businesses to stay ahead of the curve.

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