KPIs – i.e. key performance indicators – are important figures that help the controlling department continually measure and evaluate the performance and state of a company. Such KPIs also play a significant role in bookkeeping and accounting. In this article we take a look at the most important accounting KPIs, explaining what they mean and how they are calculated.
18. March 2026
New accounting KPIs: The new key figures in accounting
At a glance: The classic and new accounting KPIs
- Accounting KPIs are the relevant key figures for accounting and finance controlling
- Accounting KPIs are not freely defined, but rather must always satisfy a variety of important criteria – including relevance, measurability and influenceability
- In addition to the classic accounting KPIs, a range of new KPIs are now playing an increasingly significant role in the context of electronic payments.
- Software solutions with practical dashboard tools can help managers generate underlying data, perform analysis and display results in the form of graphics and reports.
Definition: What are accounting KPIs?
KPI stands for “key performance indicator”: this refers to important figures that, according to the Gabler Wirtschaftslexikon, relate to “the success, performance or capacity of the business” or its individual units. KPIs are used to evaluate processes and projects within a company as objectively as possible.
In the context of accounting or bookkeeping, there are of course other relevant factors compared to other areas of a company. All the key figures that are relevant for accounting and finance controlling are referred to as “accounting KPIs”.
Criteria: What matters for KPIs?
There are a few important criteria that have to be considered when developing accounting KPIs, before you can just start defining your own accounting key figures.
Defining SMART accounting targets
In accounting, KPIs are used to measure the degree to which certain targets have been achieved. To do this, you first have to define these targets properly.
Such a target should always be as specific, measurable, attainable and realistic as possible and should be achievable in a timely manner. The acronym SMART makes it easy to recall these attributes when defining appropriate accounting targets.
The context of accounting KPIs must be controllable
It only makes sense to measure key figures for performance if they also have an impact on the achievement of associated targets. In other words, the KPIs within the context of your company must be controllable and influenceable.
Measurement simply makes no sense otherwise. This is because KPIs that are dependent on external factors are difficult to control.
Coordinating accounting KPIs with your own bookkeeping processes
Your accounting KPIs should not become an end in themselves. Improving a new KPI should thus involve as little additional work as possible. That is simply unproductive – and is more likely to harm your company than benefit it.
Accordingly, make sure the processes you have defined are fully harmonised with existing ones – and that you won’t have any unnecessary extra work to achieve specific newly defined targets.
Accounting KPIs are only as good as the data they’re based on
The robustness of the underlying data is essential if you want to work with KPIs in accounting or bookkeeping. In other words: the key figures can only be as good as the data used to calculate them.
The use of business intelligence software must be mentioned explicitly here: it can make data generation much easier, avoid the risk of errors – and, in particular, help to analyse the gathered data reliably and prepare it quickly and easily.
Progress has to be measured regularly
Accounting KPIs are only meaningful if they are checked at regular intervals. This is the only way to identify a development reliably – and correlate it with specific adjustments.
That’s why we recommend measuring your accounting KPIs regularly. This is the only way you can reliably analyse whether your processes are developing in the right direction.
The growing significance of the new accounting KPIs in the context of electronic payments
Digitisation is also changing the way we pay. This in turn has a direct impact on the daily work of finance and accounting teams – especially in retail companies, restaurants, the cultural sector and in the beauty and wellness industry.
Electronic payments are not only becoming ever more important in e-commerce, but also at the POS itself. They have accounted for a steadily growing share of total revenue over the last few years according to EHI surveys. In 2022, for example, the share of card payments at the POS was 59.7% – and rising!
The resulting service fees and the delays between the payment itself and the receipt of funds create a new kind of complexity for accounting that needs to be managed properly.
The finance team also need to review acquirer fees, as these fees are a factor that should not be underestimated as their percentage of total volume increases. A number of completely new finance and accounting KPIs are consequently becoming ever more significant.
The classic accounting KPIs
Regardless of the company type or business model: there are a few classic accounting KPIs that provide important insights into the effectiveness of a company’s payment processes. We explain a few of the most important ones to you here.
KPIs for liabilities from deliveries and services
“Liabilities” refers to all outstanding payment amounts owed to companies that have provided a specific service. In other words: all open invoices that need to be settled.
Days payable outstanding (DPO)
The accounting KPI “days payable outstanding” (DPO) describes the number of days until payment of open invoices.
Companies usually aim for a high DPO value, in order to have more money available for short-term investments. The level of the DPO value also has its limits as an accounting KPI, of course: if the value is too high, this may indicate that payment periods are being exceeded or that a company is unable to pay.
The formula for days payable outstanding:
DPO =
portfolio of liabilities * selected period in days
material usage (COGS)
Invoice cycle time
This accounting KPI involves calculating the average time needed to process an invoice from receipt of invoice until payment is due. It indicates the time efficiency of bookkeeping processes.
The formula for invoice cycle time:
Invoice cycle time =
total time for invoice processing
number of processed invoices
Cost per invoice
In accounting, the “cost per invoice” KPI is used to determine the average cost incurred in processing an invoice.
It indicates the efficiency of processing in the bookkeeping department: the lower this KPI, the more efficient invoice processing is in the bookkeeping department.
The formula for cost per invoice:
Cost per invoice =
total costs for invoice processing
number of processed invoices
Accounting KPIs for receivables from deliveries and services
Receivables are the outstanding payment amounts for all products or services that have already been provided for customers. In other words: all open invoices that the company is still owed.
Days sales outstanding (DSO)
In bookkeeping, the days sales outstanding (DSO) KPI refers to the number of days between the sale and the receipt of payment.
The lower the DSO, the higher the cashflow – and thus the money available to the company for short-term investments. Companies usually aim for as low a DSO as possible.
The formula for days sales outstanding:
DSO =
portfolio of receivables
total sales on credit
* selected period in days
Average days delinquent (ADD)
The ADD KPI refers to the average number of days customers are taking to settle invoices after their due date.
Like the DSO accounting KPI, a lower value indicates a high cashflow. Companies therefore usually aim to keep this ADD value as low as possible. If the ADD value gets too high, this can also be an important warning sign: the company’s financial stability is namely at risk.
The formula for average days delinquent:
ADD =
total number of days delayed
total number of accounts
Accounts receivable turnover ratio (ART)
The accounts receivable turnover ratio (ART) is an accounting KPI that indicates the share of received payments in relation to total revenue. It thus shows how quickly receivables are being converted into cashflow.
A higher value is preferable here. If the value is too low, it may be worth incentivising faster payment of open invoices, e.g. through discounts.
The formula for accounts receivable turnover ratio:
ART =
sales + VAT
average portfolio of accounts receivable
KPIs for internal accounting performance
In addition to the “classics” above, there are a number of accounting KPIs that in particular measure how efficiently processes are running within bookkeeping and accounting. We’ve listed the KPIs we feel are most important in this context for you here.
Accuracy of accounting records
This key figure indicates how accurate bookkeeping is compared to all effected transactions. This value should naturally be as high as possible. This internal accounting KPI is calculated from the number of all correct entries divided by all entered transactions.
The formula for accuracy of accounting records:
accuracy of accounting records =
number of correct entries
total number of all entries
* 100
Reconciliation accuracy
This accounting KPI measures the accuracy of the reconciliation processes – providing important insights into the robustness of the data in bookkeeping. The higher the value, the fewer inconsistencies there are.
If this KPI is too low, you should consider increasing the digitisation of payment reconciliation. There is software that largely automates the time-consuming and error-prone reconciliation processes – and can rapidly reduce the error rate as a result.
The formula for reconciliation accuracy:
Reconciliation accuracy =
number of correctly reconciled payments
total number of payments
* 100
Average time for payment reconciliation
How long does it take to reconcile a payment on average? This accounting KPI measures the efficiency of the payment reconciliation processes. The lower this value, the higher the efficiency of payment reconciliation.
At this point it’s also worth mentioning the potential of software to massively increase the efficiency of payment reconciliation. This accounting KPI can quickly be significantly reduced using intelligent automated solutions.
The formula for average time for payment reconciliation:
average time for payment reconciliation =
total time for reconciliation
number of reconciled payments
The new accounting KPIs
In the light of the ever increasing number of electronic payments, a range of new KPIs are playing an increasingly important role for bookkeeping and finance departments, especially in retail, restaurants and the event sector.
On the one hand, you have the costs of processing electronic payments, but, on the other, you have to consider the increased efficiency that can be achieved using new automated solutions in accounting.
New accounting KPIs relating to automated payment reconciliation
The large number of electronic payments combined with their high complexity in the context of bookkeeping processing often pushes accounting teams to the limits of their capacities. No wonder then that more and more companies are taking advantage of the option of automated payment reconciliation.
This is based on software solutions that import all necessary data automatically from different sources, reconcile this data – and then export the finished posting entries to the respective bookkeeping system.
New accounting KPIs relating to automated payment reconciliation measure how well this automation is working – and how much they are actually relieving the burden on the accounting teams.
Percentage of automatically reconciled payments
This accounting KPI indicates the percentage of all payments that were reconciled fully automatically – and no longer had to be reprocessed manually. The higher this percentage, the better the payment reconciliation tool is supporting bookkeeping with laborious payment reconciliation.
The formula for percentage of automatically reconciled payments:
Percentage of automatically reconciled payments =
number of automatically reconciled payments
total number of reconciled transactions
Percentage of manual adjustments
To a certain extent, “percentage of manual adjustments” is the counterpart to “percentage of automatically reconciled payments”. The key figure indicates the percentage of transactions that the accounting team still had to adjust manually during reconciliation.
The formula for percentage of manual adjustments:
Percentage of manual adjustments =
number of manual adjustments
total number of reconciled transactions
With the increasing number of card payments and mobile payments, the percentage of fees that companies have to pay to payment processors (acquirers and payment service providers) is also rising.
Controlling and managing these fees is becoming an increasingly important finance discipline, because substantial costs can quickly be saved here. The basic requirement is first to create the necessary transparency for the amount, percentage and composition of these fees.
Payment processing cost ratio
This KPI indicates the percentage of the total payment volume that is being spent on payment processing costs. In principle: the lower this value is, the better.
The formula for payment processing cost ratio:
Payment processing cost ratio =
total costs for payment processing
total volume of payments
* 100
Average cost per transaction
This key figure indicates the average costs incurred for each transaction. In the long term, companies naturally want to keep this value as low as possible.
The formula for average cost per transaction:
Average cost per transaction =
total costs for payment processing
number of transactions
Transaction costs as a percentage of revenue
This KPI reveals the percentage of revenue that is being used for payment processing costs. This figure is particularly interesting as it also incorporates potential revenue increases from the provision of new payment methods (card payments, mobile payments, etc.).
The formula for transaction costs as a percentage of revenue:/strong>
transaction costs as a percentage of revenue =
total costs for payment processing
revenue
Average time to implement new payment service providers
In addition to basic fees for payment processing, companies also incur costs from integrating new payment options into their infrastructures.
Normally: the faster integration goes, the lower the incurred costs. This KPI measures the average time needed to implement new payment service providers.
The formula for the average time to implement new payment service providers:
average time to implement new payment service providers =
total time to integrate payment methods
number of integrated payment methods
It’s also worth mentioning universal software solutions here, which can make it much easier and faster to integrate new payment methods.
The increasing importance of dashboard tools for accounting KPIs
In terms of generating, analysing and displaying accounting KPIs, new software solutions offer managers in bookkeeping and controlling a whole variety of new possibilities: The underlying data for accounting KPIs is continually gathered automatically, analysed reliably and prepared immediately in customisable graphics or reports.
Practical dashboards allow managers to review significant KPIs and their development at a glance at any time. A good example of this is the “Payment Analytics Center” from Matchbox.
Nicolas Schwotzer
Article Author
Nicolas is the Chief Product Owner, a member of the treibauf Executive Board and founded our company more than 25 years ago. Thanks to this wealth of experience, he is one of the most important experts in reconciliation software and POS integration.
POS Integration
The Nexo protocol: an initiative to standardise cashless payments
The world of cashless payments is characterised by a range of standards, technologies and protocols – especially when it comes to cross-border transactions. The Nexo Standards consortium has taken on the task…
Read more →
Reconciliation
Success Story
How SPAR Switzerland has turned crypto payments into the new standard.
In 2024, Swiss retailer SPAR Handels AG, decided it also wanted to offer its customers the option of paying with cryptocurrencies at the POS, alongside the usual payment methods.
Read more →
POS Integration
POS middleware or direct integration? What you should look out for when tendering.
If you want to stay flexible long term and shorten your time to market, you should consider POS middleware for your POS integration. In the new article, we explain when a middleware…
Read more →