12 Most Important General Ledger Accounting KPIs


The top KPIs are vital in General Ledger Accounting as they provide quantifiable measures of performance and financial health within corporate finance. These metrics enable companies to track the efficiency and effectiveness of their accounting processes, from accounts payable and receivable to cash flow management and budgetary compliance.

They facilitate informed decision-making by highlighting financial trends, identifying areas of strength, and pinpointing opportunities for cost reduction and process improvement.

This article showcases the Most Critical 12 KPIs for General Ledger Accounting and Associated Benchmarks.

1. Current Ratio

Current Ratio is a vital financial ratio that measures a company's ability to cover short-term liabilities with short-term assets.

It serves as a key performance indicator for assessing liquidity and financial health. A higher ratio indicates a stronger ability to meet obligations, which can enhance investor confidence and operational efficiency.

Conversely, a low ratio may signal potential cash flow issues, impacting strategic alignment and business outcomes. Learn more about the Current Ratio KPI.

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We have 5 benchmarks for this KPI available in our database.

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What is the standard formula?
Current Assets / Current Liabilities


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2. Quick Ratio

The Quick Ratio serves as a critical measure of a company's short-term liquidity and financial health.

It assesses the ability to meet short-term obligations without relying on inventory sales, making it essential for cash flow management. A higher Quick Ratio indicates stronger operational efficiency and a buffer against financial distress.

This KPI influences business outcomes such as creditworthiness, investment attractiveness, and overall risk management. Learn more about the Quick Ratio KPI.

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We have 2 benchmarks for this KPI available in our database.

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What is the standard formula?
(Quick Assets / Current Liabilities)


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3. Debt to Equity Ratio

The Debt to Equity Ratio (D/E) is a crucial financial ratio that measures a company's financial leverage by comparing its total liabilities to shareholders' equity.

This KPI matters because it directly influences financial health, operational efficiency, and risk management. A higher ratio indicates greater reliance on debt financing, which can amplify returns but also increases risk.

Conversely, a lower ratio suggests a more conservative approach, potentially leading to lower returns but greater stability. Learn more about the Debt to Equity Ratio KPI.

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We have 3 benchmarks for this KPI available in our database.

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4. Return on Equity (ROE)

Return on Equity (ROE) is a critical financial ratio that measures a company's profitability relative to shareholder equity.

It serves as a key figure for assessing financial health and operational efficiency, influencing investment decisions and strategic alignment. A higher ROE indicates effective management and strong business outcomes, while a lower ROE may signal inefficiencies or underperformance.

This KPI is vital for data-driven decision-making, as it helps track results and benchmark against industry standards. Learn more about the Return on Equity (ROE) KPI.

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We have 12 benchmarks for this KPI available in our database.

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5. Net Profit Margin

Net Profit Margin (NPM) is a crucial KPI that reflects a company's financial health by measuring profitability relative to revenue.

It directly influences operational efficiency, cost control, and strategic alignment. A higher NPM indicates effective cost management and pricing strategies, while a lower margin may signal inefficiencies or increased expenses.

Companies with strong NPM can reinvest in growth initiatives and enhance shareholder value. Learn more about the Net Profit Margin KPI.

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We have 10 benchmarks for this KPI available in our database.

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6. Gross Profit Margin

Gross Profit Margin (GPM) is a critical financial ratio that reflects a company's financial health by measuring the percentage of revenue that exceeds the cost of goods sold.

This KPI directly influences profitability, pricing strategies, and operational efficiency. A higher GPM indicates effective cost control and pricing power, while a lower margin may signal inefficiencies or pricing pressures.

Companies can leverage GPM to make data-driven decisions that align with strategic goals. Learn more about the Gross Profit Margin KPI.

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We have 13 benchmarks for this KPI available in our database.

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7. Return on Assets (ROA)

Return on Assets (ROA) is a critical financial ratio that measures a company's ability to generate profit from its assets.

This KPI influences operational efficiency and financial health, guiding executives in data-driven decision-making. A higher ROA indicates effective asset utilization, while a lower value may signal inefficiencies or underperforming investments.

Companies with strong ROA metrics often enjoy better strategic alignment and improved business outcomes. Learn more about the Return on Assets (ROA) KPI.

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We have 7 benchmarks for this KPI available in our database.

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8. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)

EBITDA serves as a critical measure of a company's operational efficiency and financial health.

It provides insights into profitability by excluding non-operational expenses, making it a reliable performance indicator for stakeholders. Tracking EBITDA helps organizations assess their ability to generate cash flow, which is essential for funding growth initiatives and managing debt.

A strong EBITDA can signal robust business outcomes, while a declining figure may indicate underlying issues. Learn more about the EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) KPI.

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We have 5 benchmarks for this KPI available in our database.

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What is the standard formula?
Net Income + Interest + Taxes + Depreciation + Amortization


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9. EBIT (Earnings Before Interest and Taxes)

EBIT serves as a crucial financial metric, reflecting a company's operational profitability before the impact of interest and taxes.

It influences key business outcomes such as cash flow management and investment capacity. By focusing on EBIT, executives can better assess operational efficiency and make informed, data-driven decisions.

This KPI is essential for understanding the underlying performance of the business, enabling strategic alignment with long-term goals. Learn more about the EBIT (Earnings Before Interest and Taxes) KPI.

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We have 30 benchmarks for this KPI available in our database.

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What is the standard formula?
Net Income + Interest + Taxes


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10. Cash Conversion Cycle (CCC)

Cash Conversion Cycle (CCC) measures how efficiently a company converts its investments in inventory and receivables into cash flow from sales.

A shorter CCC indicates better operational efficiency, allowing businesses to reinvest cash more quickly into growth initiatives. This KPI influences liquidity management, working capital optimization, and overall financial health.

Companies with a streamlined CCC can improve forecasting accuracy and enhance their ROI metrics. Learn more about the Cash Conversion Cycle (CCC) KPI.

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We have 5 benchmarks for this KPI available in our database.

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11. Operating Cash Flow Ratio

The Operating Cash Flow Ratio is a critical financial ratio that measures a company's ability to cover its short-term liabilities with cash generated from operations.

This KPI serves as a leading indicator of financial health, influencing business outcomes such as liquidity management and operational efficiency. A strong ratio indicates effective cost control and robust cash flow, while a low ratio may signal potential liquidity issues.

Companies that actively monitor this metric can make data-driven decisions to improve forecasting accuracy and strategic alignment. Learn more about the Operating Cash Flow Ratio KPI.

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We have 4 benchmarks for this KPI available in our database.

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What is the standard formula?
Cash Flow from Operations / Current Liabilities


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12. Liquidity Ratio

Liquidity Ratio is a crucial measure of a company's financial health, indicating its ability to meet short-term obligations.

A higher ratio suggests robust operational efficiency and effective cost control, while a lower ratio may signal potential liquidity issues. This KPI influences business outcomes like creditworthiness, investment decisions, and cash flow management.

Organizations with strong liquidity ratios can navigate market fluctuations more effectively, ensuring strategic alignment with growth initiatives. Learn more about the Liquidity Ratio KPI.

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We have 6 benchmarks for this KPI available in our database.

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What is the standard formula?
Liquid Assets / Current Liabilities


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These 12 KPIs were selected for the General Ledger Accounting KPI database to provide a balanced view of liquidity, profitability, leverage, and operational efficiency. They combine leading indicators like Cash Conversion Cycle with lagging financial outcomes such as Return on Equity and Net Profit Margin, ensuring comprehensive coverage of the accounting function’s performance drivers.

Monitor Current Ratio alongside Quick Ratio to assess short-term liquidity quality; divergence signals inventory or receivables issues. Track Debt to Equity Ratio with ROE—rising leverage paired with stagnant or declining ROE may indicate inefficient capital structure or risk exposure. Observe EBITDA in relation to Operating Cash Flow Ratio to detect earnings quality; a growing EBITDA with flat or declining cash flow suggests potential accruals or working capital management concerns.

Prioritize Current Ratio and Debt to Equity Ratio first, as these are foundational for liquidity and capital structure analysis and typically available from standard financial statements. Next, implement ROE to connect profitability with shareholder value. These KPIs provide immediate diagnostic value and data accessibility. The full set of General Ledger Accounting KPIs, along with detailed formulas and benchmarks, is available in the KPI Depot database.

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Related Best Practices


These best practice documents below are available for individual purchase from Flevy , the largest knowledge base of business frameworks, templates, and financial models available online.


KPI Depot (formerly the Flevy KPI Library) is a comprehensive, fully searchable database of over 20,000+ KPIs and 30,000+ benchmarks. Each KPI is documented with 12 practical attributes that take you from definition to real-world application (definition, business insights, measurement approach, formula, trend analysis, diagnostics, tips, visualization ideas, risk warnings, tools & tech, integration points, and change impact).

KPI categories span every major corporate function and more than 150+ industries, giving executives, analysts, and consultants an instant, plug-and-play reference for building scorecards, dashboards, and data-driven strategies.

Our team is constantly expanding our KPI database and benchmarks database.

Got a question? Email us at support@kpidepot.com.



Each KPI in our knowledge base includes 12 attributes.

KPI Definition

A clear explanation of what the KPI measures

Potential Business Insights

The typical business insights we expect to gain through the tracking of this KPI

Measurement Approach

An outline of the approach or process followed to measure this KPI

Standard Formula

The standard formula organizations use to calculate this KPI

Trend Analysis

Insights into how the KPI tends to evolve over time and what trends could indicate positive or negative performance shifts

Diagnostic Questions

Questions to ask to better understand your current position is for the KPI and how it can improve

Actionable Tips

Practical, actionable tips for improving the KPI, which might involve operational changes, strategic shifts, or tactical actions

Visualization Suggestions

Recommended charts or graphs that best represent the trends and patterns around the KPI for more effective reporting and decision-making

Risk Warnings

Potential risks or warnings signs that could indicate underlying issues that require immediate attention

Tools & Technologies

Suggested tools, technologies, and software that can help in tracking and analyzing the KPI more effectively

Integration Points

How the KPI can be integrated with other business systems and processes for holistic strategic performance management

Change Impact

Explanation of how changes in the KPI can impact other KPIs and what kind of changes can be expected


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