Top 20 Financial KPIs Every CFO Dashboard

Should Have
Posted by CompuData Inc. | Jun 15,
2015 | Accounting/Finance, All, Intacct | 0 |

Key Performance Indicators, or KPIs, help determine the

condition and sustainability of your current business model. Get a
full view of your companys financial landscape and to increase your
competitive advantage with these key KPIs.

1.Working Capital KPI

Immediately available cash is known as Working Capital. Analyze
financial health by reading available assets that meet short-term
financial liabilities. Working capital, calculated by subtracting current
liabilities from current assets, includes assets such as on-hand cash,
short-term investments, and accounts receivable.

2.Operating Cash Flow KPI

The operating cash flow KPI helps you to monitor the financial
health of your business. In analyzing your operating cash flow KPI its
important to compare it to the total capital employed. This
analysis allows you find out if the operational aspect of your
business is producing enough cash to sustain the capital
investments that you are putting into your business. The operating
cash flow to total capital employed analysis allows you to dive a
little bit deeper into the financial health of your business beyond
your profits.

3. Current Ratio KPI

Your company needs to pay financial obligations on time. The
Current Ratio takes your assets, such as account receivables, and

current liabilities, including accounts payable, to help you

understand the solvency of your business.
Read: 5 Equations That Explain Everything a CFO Should Know
About ERP

4. Payroll Headcount Ratio KPI

How many of your employees are engaged in payroll processing?
The Payroll Headcount Ratio displays the number of employees your
company supports per dedicated full time employee.

5. Return on Equity KPI

The Return on Equity (ROE) KPI measures your organizations ability
to generate revenue for each unit of shareholder equity. The return
on equity ratio not only provides a measure of your organizations
profitability, but also your efficiency. A high or improving ROE
demonstrates to your shareholders that youre using their
investments to grow your business.

6. Quick Ratio/Acid Test KPI

Measure the ability of your organization to meet short-term financial
obligations. The Quick Ratio offers a more conservative assessment

of your fiscal health than the current ratio because it excludes

inventories from your assets.

7. Debt to Equity Ratio

The Debt to Equity Ratio measures how your organization is funding
its growth and how effectively you are using shareholder
investments. A high debt to equity ratio is evidence of an
organization fuelling growth by accumulating debt.

8. Accounts Payable Turnover KPI

Accounts Payable Turnover shows the rate at which your company
pays off suppliers and other expenses. This ratio is important for
understanding the amount of cash that your business spends on
suppliers during any given period.
Read Also: Calculating ERP ROI: What the CFO Needs To Know
About ERP

9. Accounts Receivable Turnover KPI

The problem in maintaining a large bill for a customer is that you are
essentially offering them an interest-free loan. The Accounts
Receivable Turnover KPI measures the rate at which you collect on
outstanding accounts.

10. Inventory Turnover KPI

How often you are able to sell off your entire in-stock inventory in a
given year should be measured with your Inventory Turnover KPI.
Closely related to your supply chain, this KPI indicates the ability of
your organization to generate sales and increase revenue.

11. Net Profit Margin KPI

The Net Profit Margin KPI measures how effective your business is at
generating profit on each dollar of revenue you bring in. This
financial KPI is a measure of the profitability of your business and is
instrumental in making long- and short-term financial decisions.

12. Gross Profit Margin KPI

The Gross Profit Margin measures your profit on each dollar of sales
before expenses. This ratio is calculated by looking at the difference
between production costs.

13. Finance Error Report KPI

Finance reports that require clarification or contain obvious errors
can be analyzed for further investigation via Finance Error Reports.

14. Payment Error Rate KPI

The Payment Error Rate is a percentage of incoming or outgoing
payments that were not completed due to a processing error no
Purchase Order referenced, no approval, documentation missing,
etc.
Related:4 Ways a Business Intelligence Tool Can Improve Financial
Management

15. Budget Variance KPI

The Budget Variance in projected budget totals compared to actual

operating budget totals.

16. Line Items in Budget KPI

Total number of Line Items in Budget shows the amount of detail
included.

17. Budget Creation Cycle Time KPI

The Budget Creating Cycle Time includes the number of days
needed to research, produce and publish the firms budget.
Trending: Cloud ERP: 4 Reasons To Make The Move

18. Expense Management KPI

The percentages of travel and expense vouchers submitted by
employees that contain an error insufficient documentation, wrong
charge code, or no receipt are tracked through Expense
Management KPI.

19. Internal Audit Cycle Time KPI

Management and stakeholders can view the amount of time
required to perform a full internal audit on Internal Audit Cycle Time
reports.

20. Customer Satisfaction KPI

CFOs often consider budget and time targets, as benchmarks for
successful project delivery, and while those KPIs are important, the
ultimate test is customer satisfaction. The Net Promoter Score is a
simple and effective measurement of how well you are serving your
clientele