Financial KPIs (key performance indicators) are metrics that help businesses measure their financial health and performance. Some examples of financial KPIs include:
Working capital
A measure of a business's ability to cover short-term liabilities and fund current operations
Operating cash flow
A measure of how well a business generates cash from its core operations
Net profit margin
A percentage that measures how well a business turns revenue into profits
Cash conversion cycle
The time it takes for a business to convert investments into cash
Accounts payable turnover
A measure of how quickly a business pays its expenses
Return on assets
A measure of how well a business's managing team earns money from its assets over a period of time
Revenue growth rate
A measure of how quickly a business's income or sales are increasing
Return on equity
A measure of a business's net income against each unit of shareholder equity
When selecting financial KPIs, you can consider your organization's size, industry, business model, and other factors. Dashboards that include financial KPIs can help you analyze your company's financial health and identify areas for improvement.
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