2015 Best Practices Study

2015 Best Practices Study

Key Benchmarks Profile

36. Office Equipment Depreciation/Amortization — Current year depreciation expense for equipment, furniture, fixtures. Include Section 179 purchases. 37. Total Office Equipment — The sum of items 35 & 36 38. IT Expenditures — Expensed/leased computers, servers, software, wiring, maintenance and maintenance contracts, website development/maintenance, website hosting, internet connections, & training 39. IT Depreciation / Amortization — Current year depreciation expense for computers, servers, software amortization, etc. Include Section 179 items. 40. Total IT — The sum of items 38 & 39 41. Telephone — Local & long distance, cellular telephone, and fax expenses. (Excludes leased telephone equipment; included under Office Equipment) 42. Postage — Postage, Express mail, FedEx, UPS, courier services (Excludes postage meter lease/maintenance; included under Office Equipment) 43. Supplies / Printing — Office supplies, paper, copying/printing, coffee/soft drinks/break room expenses 44. Dues / Subscriptions/ Contributions — Professional dues/membership fees, periodical & information services subscriptions, contributions 45. Taxes / Licenses — Miscellaneous local & franchise taxes, sales tax, other property taxes, license fees. (Excludes property taxes entered under Occupancy, payroll taxes, & state/federal income taxes) 46. Insurance — All property & casualty insurance including employee auto insurance, and any payments for E&O claims /settlements 47. Professional Fees — Expenses for CPAs, lawyers, consultants and other outside advisors (Excludes directors’ fee included in Administrative-Other) 48. Bad Debts — Any bad debts written off, claims paid (Excludes E&O claims/settlements) 49. Outside Services — MVRs, bank fees, employment fees, moving expenses and all other outside service expense including those used to deliver value added services to the agency’s clients (e.g. Zywave, actuarial services, COBRA administration, etc.) 50. Education / Training — Registration fees, materials, in-house training programs, etc. (Excludes training on how to use your agency management system or other agency technology) 51. Miscellaneous — Other non-specific miscellaneous operating expenses not included elsewhere 52. Total Operating — The sum of items 34, 37, 40-51 Administrative 53. Amortization of Intangibles — Acquired expirations, covenants, non-competes, etc. 54. Officer Life — Premium paid by agency, agency is beneficiary 55. Interest — All interest expense incurred 56. Other — Director’s fees, non-specific overhead allocations to parent companies, deferred compensation, and

Revenues Expenses Profitability Employee Overview Producer Info Service Staff Info Technology Insurance Carriers Appendix

any other miscellaneous administrative expenses 57. Total Administrative — The sum of items 53-56 58. Total Expenses — The sum of 25, 31, 52, & 57

PROFITABILITY

2015 Best Practices Study

59. Pretax Profit / Loss — Net revenues minus total expenses 60. EBITDA — (Earnings Before Interest, Taxes, Depreciation, and Amortization) The agency’s profit before interest, taxes, depreciation and amortization expenses are included. 61. Pro Forma Pretax Profit — The agency’s profit if all “discretionary” expenditures made for the benefit of the owners, based solely on ownership, were removed and all extraordinary / non-reoccurring expenses or revenues were normalized.

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