A changed metric definition can create a false weekly improvement

The overdue percentage improves overnight

Suppose the weekly debtor dashboard reports a much lower overdue percentage. The business has not received a major payment. The report was changed to exclude disputed invoices, but the meeting pack does not mention that change.

The new measure may serve a useful purpose, yet it is not directly comparable with the old one. Explain the definition before calling the movement a collection improvement.

Write down what the measure includes

For each important metric, record its numerator, denominator, timing basis and exclusions in plain language. Identify the source report and the person responsible for maintaining the calculation.

Keep the definition short enough to use. The aim is that another reviewer can reproduce the measure and understand what it represents without relying on the original preparer's memory.

Check changes before comparing periods

When a definition changes, explain why and identify the first affected report. Where practical, show a comparable prior-period figure calculated on the same basis, with the method disclosed.

Do not silently replace history or imply that an apparent improvement arose from business action when it came from a reporting change. Preserve the original versions needed to understand earlier decisions.

Retain the underlying balances

Keep the source totals and excluded items available for authorised review. business.gov.au's record-keeping guidance covers maintaining organised financial records, including invoices and payments.

An exclusion from one management metric should not make the underlying amount disappear from the business's overall view. Disputed or unusual items may still require a separate decision even when they are outside the selected calculation.

Source: business.gov.au: Record keeping

Ask whether the metric still answers the question

Review why the measure is being used. A metric designed to monitor routine collection may not describe total credit exposure, and one useful purpose should not be stretched to cover every decision.

Use complementary information where necessary and explain the limitations. Avoid adding more ratios merely to make the dashboard look complete when the team cannot act on them.

Document one frequently quoted measure

Before the next weekly review, write a definition for the figure most often used to judge performance. Check that the current and previous reports apply it consistently.

If they do not, explain the change before discussing the trend. Clear definitions help the business distinguish a real operational result from a different way of counting the same underlying records.