Industry benchmarks Ngā paearu ahumahi

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# Work out your performance ratios

You can work out your business performance ratios by:

• using your accounting software
• consulting your tax agent, bookkeeper or accountant
• using the formulas provided below.

If you are using the formulas you may need:

Industry benchmark: Formula:
Gross profit ratio = gross profit divided by sales and/or services
Box 6 divided by Box 2 [in your IR10 form]
Stock turnover per annum = cost of goods sold divided by ((opening stock plus closing stock) divided by 2)
(Box 3 plus Box 4 minus Box 5) divided by ((Box 3 plus Box 5) divided by 2) [in your IR10 form]
Salaries and wages/turnover ratio = salaries and wages divided by (sales and/or services plus interest received plus dividends plus rental and lease payments plus other income)
Box 23 divided by (Box 2 plus Boxes 7, 8, 9 and 10) [in your IR10 form]

Balance sheet ratios:

 Return on total assets = Total current year taxable profit divided by total assets Box 29 divided by Box 45 [in your IR10 form] Return on equity = Total current year taxable profit divided by total proprietor or shareholder funds Box 29 divided by Box 54 [in your IR10 form] Current ratio = Total current assets divided by total current liabilities Box 33 divided by Box 49 [in your IR10 form] Quick ratio = (Total current assets minus closing stock) divided by total current liabilities (Box 33 minus Box 5) divided by Box 49 [in your IR10 form] Liability structure = Total proprietor or shareholder funds divided by (total proprietor or shareholder funds plus total liabilities) Box 54 divided by (Box 54 plus Box 51) [in your IR10 form]

Find your industry benchmarks here

See an example based on Mike's takeaways to see how to make the calculations.

Currently industry benchmarks are available for 45 industries, based on data from the 2013/2014 financial year.