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About A-Score - Understand our ratios ::.
 
The A-Score model uses a statistical, multi-tiered weighting methodology for each ratio used and impacts the overall score based on three factors:
     1.  The relative importance of the ratio to the overall score - high, medium or low
     2.  The desirable target level for each ratio; and
     3.  The deviation of the actual ratio from the desirable target.
 
High Value Ratios
     
DAYS CASH ON HAND
Calculation: (Cash + Investments) / (Total Expenses / 365)
Description: The larger the number the better, with a target of 30 days. This is a measure of how many days the Agency can operate without converting its other assets to cash.
 
DAYS OUTSTANDING IN ACCOUNTS RECEIVABLE
Calculation: Accounts Receivable / (Total Revenue / 365)
Description: The smaller the number the better, with a target of 55 days. This is a measure of the effectiveness in collection of accounts receivable.
 
CURRENT RATIO
Calculation: Current Assets / Current Liabilities
Description: The larger the number the better, with a target of > 1.00 days. This is a measure of liquidity - the ability to pay current liabilities utilizing current assets.
 
DEBT - SERVICE RATIO
Calculation: (Change in Net Assets + Depreciation + Interest Expense) / (Principal Payments on Debt + Interest Expense)
Description: The larger the number the better, with a target of > 1.20 days. This is a measure of  the Agency's can ability to pay debt.
 
NET SURPLUS TO TOTAL REVENUE
Calculation: Change in Net Assets / Total Revenue
Description: The larger the number the better, with a target of 1 to 3%. This is a measure of the Agency's ability to generate surplus.
 
 
Medium Value Ratios
     
DAYS OUTSTANDING IN ACCOUNTS PAYABLE
Calculation: Accounts Payable / (Total Expenses / 365 x .25)
Description: The smaller the number the better, with a target of 35 days. This is a measure of the Agency's aging of its trade payables.
 
TOTAL LIABILITIES AS A PERCENTAGE OF NET ASSETS
Calculation: Total Liabilities / Net Assets
Description: The smaller the number the better, with a target of < 1.8. This is a measure of how the Agency assets have been acquired and an indication of the Agency's capacity to incur additional debt.
 
LINE OF CREDIT BALANCE AS A PERCENTAGE OF TOTAL CURRENT ASSETS
Calculation: Line of Credit / Current Assets
Description: The smaller the number the better, with a target of < 10%. This is a measure of the Agency's reliance on its line of credit.
 
PERCENTAGE REVENUE RECEIVED FROM THE LARGEST PAYER SOURCE
Calculation: Major Revenue Source / Total Revenue
Description: The smaller the number the better, with a target of less than 50%. This is a measure of the Agency's reliance upon one funding source.
 
REVENUE AS A PERCENTAGE OF TOTAL ASSETS
Calculation: Total Revenue / Total Assets
Description: The larger the number the better, with a target of 1.5. This is a measure of the Agency's reliance upon its assets to generate revenue.
 
 
Low Value Ratios
     
ADMINISTRATIVE EXPENSES AS A PERCENTAGE OF TOTAL EXPENSES
Calculation: Administrative Costs / Total Expenses
Description: The smaller the number the better, with a target of 8 to 12%. This is a measure of administrative efficiencies.
 
FUND-RAISING REVENUE AS A PERCENTAGE OF TOTAL REVENUE
Calculation: Fund-raising Revenue / Total Revenue
Description: The larger the number the better, with a target of 3 to 5%. This is a measure of the Agency's ability to generate income other than from government funding.
 

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