Financial ratio analysis using ARMS data-Reference-Cited by-同舟云学术

Financial ratio analysis using ARMS data

Published:2012-07-27 Issue:2 Volume:72 Page:262-272
ISSN:0002-1466
Container-title:Agricultural Finance Review
language:en
Short-container-title:

Author:

Ahrendsen Bruce L.,Katchova Ani L.

Abstract

PurposeThe purpose of this research is to evaluate the financial performance measures calculated and reported by the Economic Resource Service (ERS) from Agricultural Resource Management Survey (ARMS) data. The evaluation includes the calculation method and the underlying assumptions used in obtaining the reported values. Recommendations for improving the information reported are proposed to ERS.Design/methodology/approachThe financial measures calculated and reported are compared with those recommended by the Farm Financial Standards Council (FFSC). The underlying assumptions are identified by analyzing the software code used in calculating the values reported. The values reported by ERS are duplicated and alternative methods for calculating the financial performance measures are considered. The values obtained from the various calculation methods are compared and contrasted.FindingsRecommendations for ERS include: calculate and report the financial measures recommended by FFSC, note values that are imputed, periodically update and validate assumptions used in calculating imputed values, review its policy for flagging estimates as statistically unreliable, report medians and other select percentiles, and consider reporting the percent of farm businesses that have values within critical zones.Originality/valueA total of four methods for calculating financial performance measures are compared and contrasted. These are the aggregate mean, sample mean, sample median, and percentage of farm businesses with values in critical zones.

Publisher

Emerald

Subject

Agricultural and Biological Sciences (miscellaneous),Economics, Econometrics and Finance (miscellaneous)

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