Definition, Meaning & Synonyms
dso
noun
di-es-o
Definition
DSO stands for Days Sales Outstanding, a financial metric used to measure the average number of days that a company takes to collect revenue after a sale has been made.
Examples
- The company improved its DSO from 45 days to 30 days by tightening credit policies.
- Monitoring DSO is crucial for maintaining healthy cash flow.
Meaning
It provides insights into how efficiently a company manages its accounts receivable. A lower DSO indicates that a company is efficient at collecting payments, while a higher DSO may suggest issues with cash flow or credit policies.
Synonyms
- Accounts Receivable Days
- Revenue Collection Period
