Glossary · Receivables metrics
Past-due percentage
Also called Percentage of receivables past due
Past-due percentage is the share of total accounts receivable that is overdue. It shows at a glance how much of what you are owed is late.
Past-due percentage divides overdue receivables by total receivables. It complements DSO: DSO can stay flat while more and more of the balance slips past due, and this ratio shows that shift.
Break it down by aging bucket for more detail. Ten percent overdue mostly at 1–30 days is routine; ten percent at over 90 days is a collection risk.
Measure it at the same point each month, such as the last working day, because receivables swing around invoicing and payment runs.
Because it is a share, the ratio can improve for the wrong reason. A big month of new invoicing swells current receivables and makes the overdue share look smaller, even if no late invoice was paid. Read it next to the amount overdue, not on its own.
Formula
Past-due percentage = overdue receivables ÷ total receivables × 100
Example
At month end a firm is owed €120,000, of which €36,000 is past due. Its past-due percentage is 36,000 ÷ 120,000 = 30%.