Days of Accounts Payable Outstanding
Calculate the days payables outstanding, an efficiency ratio that measures the number of days it takes a company to pay its suppliers.
The days payables outstanding (DPO) ratio is used to assess how efficiently a company manages its accounts payable. It calculates the average number of days it takes for a company to pay its suppliers after receiving an invoice. A higher DPO ratio indicates that the company is taking longer to pay its suppliers, which may have implications for its relationships with suppliers.
The formula is as follows:
\[\text{Days Payables Outstanding} = (\text{Average Accounts Payable} / \text{Cost of Goods Sold}) \cdot \text{Days}\]Also known as: DPO, days payable outstanding.
Days of Accounts Payable Outstanding in Python or via the MCP
Install the Finance Toolkit with:
pip install financetoolkit -U
Then call get_days_of_accounts_payable_outstanding as shown below.
from financetoolkit import Toolkit
toolkit = Toolkit(
["GM", "F", "TSLA"],
api_key="FINANCIAL_MODELING_PREP_KEY",
start_date="2021-01-01",
end_date="2025-12-31",
)
toolkit.ratios.get_days_of_accounts_payable_outstanding()
Or, after setting up the Finance Toolkit MCP, ask:
How many days did General Motors, Ford and Tesla take to pay their suppliers from 2021 to 2025?
Which returns:
| 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|
| F | 72.7319 | 65.8213 | 61.9989 | 56.6067 | 55.4167 |
| GM | 72.691 | 69.371 | 71.0554 | 63.4048 | 54.8851 |
| TSLA | 72.951 | 76.1207 | 68.4805 | 61.1935 | 60.6784 |
Parameters
get_days_of_accounts_payable_outstanding accepts the following parameters.
| Parameter | Type | Description | Example |
|---|---|---|---|
days | int | float | The number of days in the window the flows cover. Defaults to None, which uses 365 for annual data and 365 / 4 for quarterly data, multiplied by trailing when set (e.g. 365 for quarterly data with trailing=4). | 360 |
rounding | int | None | The number of decimals to round the results to. Defaults to None, which uses the rounding of the Toolkit (4 unless set otherwise). | 2 |
growth | bool | Whether to calculate the growth of the ratios. Defaults to False. | True |
lag | int | list[int] | The lag to use for the growth calculation. Defaults to 1. | 4 |
compound | bool | Whether the growth is the compound annual growth rate over the lag (e.g. lag=5 for the five-year CAGR) instead of the total change. Defaults to False. | False |
standardize | bool | Whether to standardize (Z-Score) the result. When combined with growth=True, standardizes the growth values instead of the raw values. Defaults to False. | True |
trailing | int | The number of periods to sum flows (income and cash flow statement items) over, with balance sheet items averaged over the same number of period ends. E.g. 4 with quarterly data gives the trailing twelve months (TTM) and 3 with annual data a three-year cumulative figure. Defaults to None, which uses single-period flows (per quarter and not annualized with quarterly data). | 4 |