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Ask the Experts:  Cash Payment Metrics 

February 16, 2018 10:59 am

Outside of the standard days cash on hand liquidity metric, what other cash or payment term metrics are useful? Currently, we’re considering days in accounts receivable (A/R) (A/R/supply expense/365 days) and average payment period (current liabilities/(total expenses–depreciation)/365), the latter of which Moody’s provides some standard median metrics. 


Answer: It’s a good idea not to have too many key performance indicators on a single topic or you court paralysis by analysis. Thus, I think the three you suggest are adequate. 

This question was answered byDavid Hammer, FHFMA, CHFP, principal at Healthcare Performance Management Consultants. 


What do you think? Please share your thoughts on this question in the comments section below.  

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