This is an indicator of whether or not the company pays its bills on time. It’s the total value for supplier payments that are still due divided by all AP, and a higher ratio means they're paying more often than expected! Paying out in smaller increments can ease some cash flow problems but it might mean suppliers won't extend any further favors if things get tight again soon enough.
The formula is: Current accounts payable =
(Total accounts payable – Past due accounts receivable) / Total accounts receivable