7 KPIs Every CFO Dashboard Should Have
- Published: Friday, 26 February 2016 21:21
Staying ahead of the curve and ahead of your competition can be hard work. But, by using real-time data to drive decisions, you can better align yourself and your organization for success. Using a dashboard that contains the Key Performance Indicators (KPIs) you need, gives you and your team the ability to gain access to your business performance at a glance.
Gain Instant Access to Insight
Today’s Chief Financial Officers (CFO) juggle multiple data sets, which can be time consuming and stressful. Access to the right dashboard, however, can provide instant access to business insight, ensuring that you have the information you need to make more informed decisions. Below are 7 KPIs that can save you countless hours of digging through reports, and enable you to transform complex analytics into decisive actions.
1. Working Capital KPI
Cash that is immediately available is known as Working Capital. This KPI can help you analyze your company’s financial health by viewing available assets that meet short-term financial liabilities.
2. Operating Cash Flow KPI
Diving deeper into the financial health of your organization beyond profits, Operating Cash Flow allows you to discover if the operational aspect of your business is generating enough cash to sustain the capital investments that you’re putting in.
3. Accounts Payable Turnover KPI
AP Turnover shows the rate at which your business pays off suppliers and additional expenses. This KPI is important for fully understanding the amount of cash your company spends on suppliers during a given timeframe.
4. Accounts Receivable Turnover KPI
The problem with maintaining large bills for customers is you are basically offering them an interest-free loan. The AR Turnover KPI measures the rate at which you collect on outstanding accounts.
5. Debt to Equity Ratio
The Debt to Equity Ratio measures how your company is funding growth and how effectively you are using investments. A high debt to equity ratio is proof that an organization is fueling growth by accumulating debt.
6. Current Ratio KPI
It’s vital that your business pays financial obligations in a timely manner. Current Ratio takes your assets, such as AR and current liabilities including AP, to help you better understand the creditworthiness of your business.
7. Quick Ratio/Acid Test KPI
Quick Ratio offers a more conservative calculation of your financial health compared to current ratio because it excludes inventory from your assets. Additionally, Quick Ratio helps you measure the ability to meet your short-term financial obligations.