The DSO (Days Sales Outstanding) calculation formula determines the average number of days it takes a company to collect payments from credit sales. It is computed as DSO = (Accounts Receivable / Total Credit Sales) * Number of Days. This metric is vital for assessing the efficiency of accounts receivable management, helping businesses monitor cash flow and evaluate the effectiveness of credit policies in maintaining financial health.
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Emagia is a leading provider of AI-powered Order-to-Cash (O2C) automation platform that modernizes finance operations for midsize to large global businesses. Many global businesses and shared service centers use Emagia’s Enterprise Receivables Management System to transform to digital world-class operations in credit, invoicing and payments, receivables, collections, deductions, cash application and cash forecasting. Emagia solutions improve their customers DSO, cash flow, credit risk, operational cost, compliance and profitability.
