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Considering DSO

Answer: Another reader wrote: One measurement that I think is important to talk about is Past due DSO, or Days Delinquent DSO. This is important because DSO is not directly controllable by credit, but the Past Due DSO is more directly controlled by credit unless your company is totally driven and controlled by sales. I believe that Days Delinquent DSO is a better measure of a credit services department performance than the more customary DSO. Where a lot of value comes in for this measurement is if you do it by past due buckets. For example, if your Past Due DSO is ten days, but eight of these days are in the 1 to 30 Past Due aging bucket, then that tells a better story than if the days were spread across all of the aging buckets. Please consider a white paper on measuring credit department performance. Response: Good idea. I will start working on one.

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