2006 Best Practices Study

AGENCIES WITH REVENUES UNDER $500,000

FINANCIAL STABILITY

2006

A.

Current Ratio A current ratio greater than 1:1 indicates that cash and assets with short-term maturities are sufficient to meet a firm’s short-term obligations.

Average

Top 25%

Liquidity/Current Ratio

0.91:1

1.22:1

PROFILE

B.

Tangible Net Worth The tangible net worth is an important measure as it represents the net value of the corporation if it were liquidated. A low or negative tangible net worth impacts a firm’s ability to invest in new opportunities, develop new products, hire new employees, make other capital expenditures and handle stockholder redemption obligations .

REVENUES/ EXPENSES

Average

Top 25%

Tangible Net Worth (as % of Net Rev)

18.7% 30.0%

FINANCIAL STABILITY

C1.

Receivables The following ratio measures the collection practices of an agency, with a lower ratio representing more timely collections.

Average

Top 25%

Receivables/Payables Ratio

64.4% 13.0%

EMPLOYEE OVERVIEW

C2.

Aged Receivables

Average

Top 25%

Over 60 Over 90

32.6% 11.6%

6.6% 5.8%

PRODUCER INFO

SERVICE STAFF INFO

TECHNOLOGY

INSURANCE CARRIERS

2006 Best Practices Study

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