Days' sales outstanding

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Days' sales outstanding

Average collection period.

Days' Sales Outstanding

In accounting, a company's average collection period. Usually calculated monthly, it indexes the relationship between outstanding accounts receivable and total sales over a given period and is a common tool in measuring liquidity. Tracking trends in days' sales outstanding can also indicate the level of credit risk a company is willing to extend at different points of time. It is also called the collection ratio.
References in periodicals archive ?
The Aceva Working Capital Management suite of applications delivers the tools and work flow improvements necessary to reduce Days Sales Outstanding (DSO), eliminate financial process errors, identify and resolve root causes, and unlock working capital.
Net days sales outstanding declined to 53 days for the quarter, representing our seventh consecutive quarter in which net days sales outstanding in accounts receivable is 56 days or less.
6/30/98 9/30/98 12/31/98 3/31/99 Days Sales Outstanding Calculation:
Using this kind of analysis, EKCC recently changed its invoices to make it easier for customers to pay and thereby improve our statistics on the number of days sales outstanding.
Days sales outstanding was 150 days at December 31, 1997 and 263 days at December 31, 1996.
Mohawk also will work to significantly increase the number of customers who pay electronically, minimizing days sales outstanding (DSOs) and further enabling customers to take advantage of early payment discounts.
However in the near term we are concerned that: pricing pressure and production issues may limit the potential for gross margin expansion, economic issues in Asia may continue to have some impact on the company's sales in that region, and a gradual shift in the company's geographic revenue mix away from Letter of Credit payment markets may result in higher Days Sales Outstanding over time.
The Best Financially Managed Emerging Fabless Company Award (less than $500 million in sales) is designed to evaluate the financial health of public fabless semiconductor companies based on a number of financial indices such as return on investment, return on equity, inventory turns, revenue, net income, days sales outstanding, cash per share, cash burn, gross profit margin, operating margin and current ratio.
Days sales outstanding increased from 63 to 65 days.
Quarterly days sales outstanding declined to 99 days from 104 days in the previous quarter.
This increased efficiency directly impacts financial measurements through improved productivity and reduced Days Sales Outstanding (DSO).
The greatest improvement this year was in Days Sales Outstanding, in part because accounts receivable is the area of working capital where CFOs have the most influence.