CEI formula
CEI (%) = [(Beginning AR + Credit sales - Ending total AR) / (Beginning AR + Credit sales - Ending current AR)] × 100
Use the same reporting period, currency, and account population throughout. Beginning AR is opening receivables; ending total AR includes all closing receivables; ending current AR is the closing portion not yet due. Credit sales exclude cash sales.
Worked example
Hypothetical figures: Beginning AR is $100,000, credit sales are $50,000, ending total AR is $90,000, and ending current AR is $60,000.
CEI = ($60,000 / $90,000) × 100 = 66.7%.
The numerator and denominator must not be reversed.
Interpreting the result
A higher CEI generally indicates a greater share collected on a comparable basis. It is not a universal performance benchmark. Credits, write-offs, unapplied payments, and adjustments can change balances without representing cash receipts; reconcile these effects.
Do not interpret the ratio when the denominator is zero or negative. Review unexpected results and use CEI alongside aging, disputes, and cash collections.
Source: Oracle's CEI metric documentation.