1. Operating cash flow

Is the movement of money into and out of a business

2. Working capital

Working capital is a measure of liquidity, indicating how quickly a business can generate cash.

3. Forecast variance

Forecast variance, shows the difference between the forecast and the outcome. Tracking over time helps you understand and improve forecast accuracy.

4. Days Sales Outstanding

Reflects the average number of days to receive payment for sales.

5. Days Payable Outstanding (DPO)

Is the average time it takes a company to pay its invoices or accounts payable.

6. Current ratio

The current ratio is a measure of a company’s ability to pay off its short-term liabilities. Note that liquidity and cash flow are not the same thing.

7. Cash flow coverage ratio

Your company’s ability to pay its debts with its cash flow from operations.

8. Cash conversion cycle

Is a measurement of the company’s time to convert its investments and inventory to cash, usually measured in days.

9. Liquidity ratio

Also known as the quick ratio or acid-test ratio, the liquidity ratio is a metric that shows how well a debtor can pay off its current debt without acquiring additional capital.

10. Weeks of liquidity on hand

This can be particularly helpful to understand to plan for times of economic stress. This metric shows how many weeks a business can pay its current financial obligations.

Bonus track… Daily and weekly aged debtor analysis

Accounts receivable aging is a “must watch” for your company. Keeping an eye on how long it takes to receive payment for products or services is a good signal of accounts receivable practices and can help you maintain a healthy cash management discipline.