Managing accounts receivable (AR) is essential for a healthy cash flow in any dental practice. Accounts Receivable KPIs (AR KPIs) are designed to provide a clear view of outstanding balances and the aging of those balances, helping practices manage collections more effectively. With these KPIs, you can set financial goals, track performance, and improve collection processes to ensure a steady revenue stream.
You can access the AR Aging KPIs by navigating to:
PracticeIQ > Home > Accounts Receivables > Data Table Icon
or PracticeIQ > Home > Accounts Receivables > Three Dot Menu > Show Detail Panel
Key AR Aging KPIs Explained
These KPIs cover different aspects of accounts receivable, allowing you to monitor balances over time, identify overdue accounts, and set specific goals to improve collection efficiency. Here’s a breakdown of each AR KPI:
AR Total Current: The total dollar amount of accounts receivable currently due (not past due). This metric helps you understand the immediate revenue in the pipeline without any delays in payment.
AR Total Current Percent %: The percentage of total accounts receivable that is current. This KPI shows what proportion of your receivables is on time, indicating how efficiently payments are being managed.
AR Total 30 to 60 Days: The dollar amount of receivables that are between 30 and 60 days past due. Accounts in this range may require follow-up to ensure timely payment.
AR Total 30 to 60 Percent %: The percentage of total accounts receivable that is 30 to 60 days overdue. This KPI helps gauge the level of mid-term overdue accounts in relation to the total receivables.
AR Total 60 to 90 Days: The dollar amount of accounts that are between 60 and 90 days past due. Accounts in this category are becoming increasingly overdue and may indicate potential collection issues.
AR Total 60 to 90 Percent %: The percentage of total accounts receivable that is 60 to 90 days overdue. This helps identify the proportion of significantly overdue accounts, which may impact cash flow if not addressed promptly.
AR Total Over 90 Days: The dollar amount of accounts that are more than 90 days overdue. Accounts in this range are the most critical and may require immediate collection efforts.
AR Total Over 90 Percent %: The percentage of accounts receivable that is over 90 days overdue. This KPI shows the percentage of high-risk accounts that may be challenging to collect.
Setting Goals for AR KPIs
Setting clear goals for each KPI allows you to establish benchmarks for optimal performance. For example:
AR Total Current Percent Goal: Aim to maintain a high percentage of current receivables, which indicates timely payments.
AR Total 30 to 60 Percent Goal: Set a target to reduce this percentage, aiming to minimize the number of accounts entering this overdue stage.
AR Total Over 90 Percent Goal: Prioritize reducing this high-risk category to prevent uncollectible debts and improve cash flow.
How These KPIs Benefit Your Practice
Accounts Receivable KPIs enable your practice to:
Monitor Collection Trends: By viewing these KPIs over time, you can identify trends in overdue payments, enabling you to address issues early.
Improve Cash Flow: Keeping AR balances current improves cash flow and ensures that your practice has the resources needed to operate smoothly.
Set Collection Goals: With the ability to set goals for each KPI, you can work toward specific collection targets, ensuring steady revenue and reduced outstanding balances.
Prioritize Collection Efforts: Understanding which accounts are most overdue helps you prioritize follow-up and collection efforts, focusing on those accounts that need immediate attention.