30+ KPIs, the modern accountant should be tracking
A plethora of accountants love numbers and mapping information, and one needs to advise clients on a financial, tax, and organizational level too. For example, to get a clear picture, one needs to consider tracking the number of readers of their newsletters, the speed at which a set of annual accounts are prepared, or the average costs per employee, and several other factors.
Financial KPIs:
Financial KPIs say something about the financial success of your company. Of course, net profit is not the only indicator here, but one can also track the speed with which invoices are paid and profit per client or even a niche.
Percentage of clients with recurring revenues vs. transactional sales- This KPI compares two business models, which include a transactional business model, which tends to assume the number of hours spent multiplied by rate besides a recurring business model that is based on a subscription form.
Client lifetime value– The client lifetime value (CLV) is a perfect blend of the expected duration of the relationship with the standard financial and value. In practice, calculating the CLV can be pretty challenging as it is often assumed that all patrons tend to be equal in terms of cost, but this may not always be true. Hence, filtering by segments is an option to get an accurate picture of the scenario.
Average turnover per client per segment/department– The CLV and client profitability score can both be determined by the concerned department, and the way numbers one is tracking are put into perspective by placing clients with the same value or costs together in one niche.
Time of payment within the invoicing process– the minimum number of days the invoice is open is likely to be plotted against different moments within one’s billing process, including before the reminder, after the reminder, after the last reminder, or even once the invoice has been forwarded to any collection agency. Above all, the faster, the better.
Sales growth rate- Profit generation is the main objective of any company. The revenue growth percentage tends to look at the ‘top line.’ The current quarter’s ratio is likely to be compared to the last quarter or the same quarter of the previous year. This gives a clear picture of the performance of an organization and can be compared to the competition in no time.
Turnover per employee– By measuring the employees’ productivity for a more extended period, the management can quickly get a grip on how they can improve the same. In addition, employees’ productivity is easily t determined by comparing it with other accounting companies across the industry.
Several billable v/s non-billable hours per employee in the company– it is one of the most apparent KPIs for mapping productivity as the ratio between time spent on patrons and on other activities tends to say at least something about the time commitment and productivity of their employees.
Average processing time per invoice or receipt – the company needs to understand How long it takes their employees to submit an invoice or receipt? The speed at which invoices are processed tends to speak something about their skills and productivity.
