Lockup is the combination of your Work In Progress (WIP) and Debtors.  

It can also be expressed in days - the amount of days taken to convert your WIP and your Debtors (Receivables) into Cash.

It is calculated by combining the two measurements:
 

Debtors (Receivables) - money owed to you

To improve Debtors you could:

•      Have clear terms of trade.
•      Make Payments easier.
•      Issue statements property on overdue accounts.
•      Issue letters / followed by phone call advising the client / customer of the overdue account.

Work In Progress (WIP) - Work that has been done but not invoiced

To improve your WIP you could:

•      Communicate to the client / customer what is required to complete the task / engagement.
•      Issue interim accounts.
•      Issue invoices promptly at the end of the engagement.

If you would like to discuss further please contact us:
McNamara & Company - Chartered Accountants, located minutes from the Melbourne CBD
www.mcnamaraandcompany.com.au/contact-us
Phone +61 3 9428 1062
Email admin@mcnamaraandco.com

Please refer to disclaimer at the bottom of the page.