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Do you know any performance goals for accounting/accounts payable

Katherine Lee's Profile

the goals should not be task based.

Answers

Topic Expert
Christie Jahn
Title: CFO
Company: Prime Investments & Development
(CFO, Prime Investments & Development) |

We use AR days, bank reconciliation accuracy, payroll accuracy for AP you could use nothing over 30 days old or % of late invoices depending on your structure.

Elisabeth Bagdiul
Title: Consultant
Company: None
(Consultant, None) |

Key Performance Indicators [KPI] benchmarks are quite business process specific.
By business process I mean the sequence of logically followed tasks and decisions which eventually bring out specific product, service or service as product. There is a lot about AP KPIs in the web, but I would recommend prior getting to what is available on the market first try to answer below questions:
1. what your AP team does and how much your business risks are related to AP activities
2. how do you or can you measure these activities [in terms of volume, timeline, quality, dependencies]
3. what would it mean to your business that AP team is performing ''well'', in other words: what is critical to quality [CTQ] of your team's output. ILet's say: performing well means there is only 1% of all invoices received within the X month which remain unresolved [=not posted] for longer than 5 business days. Upon that it should be possible to define the benchmarks which can be later validated if they are relevant and realistic towards set expectations within your business.
4. how would you measure the benchmarks from point 3, and
5. how would you collect the data for measurement and on which frequency

This should allow you to define your ''key performance indicators matrix'' with dependencies [dependencies meaning -> if your outcomes are below specified benchmark -> what are the root causes of it and how would you plan to eliminate it for future operations].

Key performance indicators should be first of all meaningful for your business (high, medium, low criticality levels], to say: they should be basis for your decisions in future in terms of improvements or any business process reingeneering needs. Otherwise - why you would then need them if they do not bring any value in measuring?

I hope it helps and inspires :)

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