Selling, general, and administrative (SGA) costs as a percentage of business entity revenue

This measure calculates the organization's expenditure in selling, general, and administrative (SG&A) costs as a percentage of business entity revenue. SG&A costs encompass a wide variety of areas, including marketing/selling products and services, accounting, planning, human resources, research and development, and maintenance of facilities. This measure is part of a set of Cost Effectiveness measures that help companies understand all cost expenditures related to the process "manage financial resources."

Benchmark Data

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Measure Category:
Cost Effectiveness
Measure ID:
104464
Total Sample Size:
34,369 All Companies
Performers:
25th Median 75th
- - -
Key Performance Indicator:
No

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Compute this Measure

Units for this measure are percent.

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(Total SG&A costs / Total business entity revenue) * 100

Key Terms

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Total annual revenue is net proceeds generated from the sale of products or services. This should reflect the selling price less any allowances such as quantity, discounts, rebates and returns. If your business entity is a support unit and therefore does not directly generate revenue, then provide the revenue amount for the units you support. For government/non-profit organizations, please use your non-pass-through budget. For insurance companies the total annual revenue is the total amount of direct written premiums, excluding net investment income. Note: Business entity revenue needs to only include inter-company business segment revenue when the transactions between those business segments are intended to reflect an arm's length transfer price and would therefore meet the regulatory requirements for external revenue reporting.

Includes marketing and selling of products/services, accounting, planning, human resources, research and development and maintenance of facilities. SG&A costs include all compensation and benefits (excluding incentive compensation); direct operating costs related to the provision of traditional SG&A expenses, maintenance time and expenses, subscriptions, publications, and related costs.

Cost effectiveness measures are those in which two related variables, one of which is the cost and one of which is the related outcome related to the expenditure are used to determine a particular metric value.

For survey purposes, a business entity is defined as an entity that:

  1. performs significant aspects of the processes for the surveys identified, or
  2. is part of a cost or revenue center within the company.

Within your organization, diverse departments may be geographically co-located, with closely integrated operations that form part of one "business entity" which may be a great distance apart. When trying to determine if related parts of your operation should be considered a single business entity, look for the following characteristics:

  • Do they operate closely together?
  • Do they serve many of the same customers?
  • Do they support the same region or product group?
  • Do they share any performance measures?
  • Is data meaningful at a consolidated level?

Examples of business entity definition:

  1. A general ledger accounting unit located in Germany has two groups. One performs general ledger accounting for the corporate headquarters, which has three business units. The other group does general ledger accounting for one of the three business units. In spite of their geographic co-location, their roles are substantially different and consolidating their data into a single response would make it less meaningful. Each group should be treated as a separate business entity.
  2. Three business units within a corporation use a shared services center for accounts payable and expense reimbursement, but are self-supporting for the other financial processes. The best approach is to make the shared services centre a separate business entity for accounts payable and expense reimbursement, and to retain the three original business units for the other financial processes.
  3. A global manufacturing company has five plant locations, each manufacturing product and each with its own logistics operations. For purposes of completing a manufacturing and logistics survey, they should be treated as five separate business entities.

Measure Scope

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Cross Industry (7.3.1)

  • 9.1 - Perform planning and management accounting (10728)
    • 9.1.1 - Perform planning/budgeting/forecasting (10738)
      • 9.1.1.1 - Develop and maintain budget policies and procedures (10771)
      • 9.1.1.2 - Prepare periodic budgets and plans (10772)
      • 9.1.1.3 - Operationalize and implement plans to achieve budget (20135)
      • 9.1.1.4 - Prepare periodic financial forecasts (10773)
      • 9.1.1.5 - Perform variance analysis against forecasts and budgets (20136)
    • 9.1.2 - Perform cost accounting and control (10739)
      • 9.1.2.1 - Perform inventory accounting (10774)
      • 9.1.2.2 - Perform profit center accounting (14057)
      • 9.1.2.3 - Perform cost of sales analysis (10775)
      • 9.1.2.4 - Perform product costing (10776)
      • 9.1.2.5 - Perform variance analysis (10777)
      • 9.1.2.6 - Report on profitability (11175)
    • 9.1.3 - Perform cost management (10740)
      • 9.1.3.1 - Determine key cost drivers (10778)
      • 9.1.3.2 - Measure cost drivers (10779)
      • 9.1.3.3 - Determine critical activities (10780)
      • 9.1.3.4 - Manage asset resource deployment and utilization (10781)
    • 9.1.4 - Evaluate and manage financial performance (10741)
      • 9.1.4.1 - Assess customer and product profitability (10782)
      • 9.1.4.2 - Evaluate new products (10783)
      • 9.1.4.3 - Perform life cycle costing (10784)
      • 9.1.4.4 - Optimize customer and product mix (10785)
      • 9.1.4.5 - Track performance of new-customer and product strategies (10786)
      • 9.1.4.6 - Prepare activity-based performance measures (10787)
      • 9.1.4.7 - Manage continuous cost improvement (10788)
  • 9.2 - Perform revenue accounting (10729)
    • 9.2.1 - Process customer credit (10742)
      • 9.2.1.1 - Establish credit policies (10789)
      • 9.2.1.2 - Analyze/Approve new account applications (10790)
      • 9.2.1.3 - Analyze credit scoring history (14187)
      • 9.2.1.4 - Forecast credit scoring requirement (14188)
      • 9.2.1.5 - Review existing accounts (10791)
      • 9.2.1.6 - Produce credit/collection reports (10792)
      • 9.2.1.7 - Reinstate or suspend accounts based on credit policies (10793)
    • 9.2.2 - Invoice customer (10743)
      • 9.2.2.1 - Maintain customer/product master files (10794)
      • 9.2.2.2 - Generate customer billing data (10795)
      • 9.2.2.3 - Transmit billing data to customers (10796)
      • 9.2.2.4 - Post receivable entries (10797)
      • 9.2.2.5 - Resolve customer billing inquiries (10798)
    • 9.2.3 - Process accounts receivable (AR) (10744)
      • 9.2.3.1 - Establish AR policies (10799)
      • 9.2.3.2 - Receive/Deposit customer payments (10800)
      • 9.2.3.3 - Apply cash remittances (10801)
      • 9.2.3.4 - Prepare AR reports (10802)
      • 9.2.3.5 - Post AR activity to the general ledger (10803)
    • 9.2.4 - Manage and process collections (10745)
      • 9.2.4.1 - Establish policies for delinquent accounts (10804)
      • 9.2.4.2 - Analyze delinquent account balances (10805)
      • 9.2.4.3 - Correspond/Negotiate with delinquent accounts (10806)
      • 9.2.4.4 - Discuss account resolution with internal parties (10807)
      • 9.2.4.5 - Process adjustments/write off balances (10808)
      • 9.2.4.6 - Perform recovery workout (14007)
      • 9.2.4.7 - Manage default accounts (14008)
    • 9.2.5 - Manage and process adjustments/deductions (10746)
      • 9.2.5.1 - Establish policies/procedures for adjustments (10809)
      • 9.2.5.2 - Analyze adjustments (10810)
      • 9.2.5.3 - Correspond/Negotiate with customer (10811)
      • 9.2.5.4 - Discuss resolution with internal parties (10812)
      • 9.2.5.5 - Prepare chargeback invoices (10813)
      • 9.2.5.6 - Process related entries (10814)
  • 9.3 - Perform general accounting and reporting (10730)
    • 9.3.1 - Manage financial policies and procedures (10747)
      • 9.3.1.1 - Negotiate service-level agreements (10815)
      • 9.3.1.2 - Establish accounting policies (10816)
      • 9.3.1.3 - Publish accounting policies (20604)
      • 9.3.1.4 - Set and enforce approval limits (10817)
      • 9.3.1.5 - Establish common financial systems (10818)
    • 9.3.2 - Perform general accounting (10748)
      • 9.3.2.1 - Maintain chart of accounts (10819)
      • 9.3.2.2 - Process journal entries (10820)
      • 9.3.2.3 - Process allocations (10821)
      • 9.3.2.4 - Process period end adjustments (10822)
      • 9.3.2.5 - Post and reconcile intercompany transactions (10823)
      • 9.3.2.6 - Reconcile general ledger accounts (10824)
      • 9.3.2.7 - Perform consolidations and process eliminations (10825)
      • 9.3.2.8 - Prepare trial balance (10826)
      • 9.3.2.9 - Prepare and post management adjustments (10827)
    • 9.3.3 - Perform fixed-asset accounting (10749)
      • 9.3.3.1 - Establish fixed-asset policies and procedures (10828)
      • 9.3.3.2 - Maintain fixed-asset master data files (10829)
      • 9.3.3.3 - Process and record fixed-asset additions and retires (10830)
      • 9.3.3.4 - Process and record fixed-asset adjustments, enhancements, revaluations, and transfers (10831)
      • 9.3.3.5 - Process and record fixed-asset maintenance and repair expenses (10832)
      • 9.3.3.6 - Calculate and record depreciation expense (10833)
      • 9.3.3.7 - Reconcile fixed-asset ledger (10834)
      • 9.3.3.8 - Track fixed-assets including physical inventory (10835)
      • 9.3.3.9 - Provide fixed-asset data to support tax, statutory, and regulatory reporting (10836)
    • 9.3.4 - Perform financial reporting (10750)
      • 9.3.4.1 - Prepare business unit financial statements (10837)
      • 9.3.4.2 - Prepare consolidated financial statements (10838)
      • 9.3.4.3 - Perform business unit reporting/review management reports (10839)
      • 9.3.4.4 - Perform consolidated reporting/review of cost management reports (10840)
      • 9.3.4.5 - Prepare statements for board review (10841)
      • 9.3.4.6 - Produce quarterly/annual filings and shareholder reports (10842)
      • 9.3.4.7 - Produce regulatory reports (10843)
      • 9.3.4.8 - Perform legal and management consolidation (14074)
  • 9.4 - Manage fixed-asset project accounting (10731)
    • 9.4.1 - Perform capital planning and project approval (10751)
      • 9.4.1.1 - Develop capital investment policies and procedures (10844)
      • 9.4.1.2 - Develop and approve capital expenditure plans and budgets (10845)
      • 9.4.1.3 - Review and approve capital projects and fixed-asset acquisitions (10846)
      • 9.4.1.4 - Conduct financial justification for project approval (10847)
    • 9.4.2 - Perform capital project accounting (10752)
      • 9.4.2.1 - Create project account codes (10848)
      • 9.4.2.2 - Record project-related transactions (10849)
      • 9.4.2.3 - Monitor and track capital projects and budget spending (10850)
      • 9.4.2.4 - Close/capitalize projects (10851)
      • 9.4.2.5 - Measure financial returns on completed capital projects (10852)
  • 9.5 - Process payroll (10732)
    • 9.5.1 - Report time (10753)
      • 9.5.1.1 - Establish policies and procedures (10853)
      • 9.5.1.2 - Collect and record employee time worked (10854)
      • 9.5.1.3 - Analyze and report paid and unpaid leave (10855)
      • 9.5.1.4 - Monitor regular, overtime, and other hours (10856)
      • 9.5.1.5 - Analyze and report employee utilization (10857)
    • 9.5.2 - Manage pay (10754)
      • 9.5.2.1 - Enter employee time worked into payroll system (10858)
      • 9.5.2.2 - Maintain and administer employee earnings information (10859)
      • 9.5.2.3 - Maintain and administer applicable deductions (10860)
      • 9.5.2.4 - Monitor changes in tax status of employees (10861)
      • 9.5.2.5 - Process and distribute payments (10862)
      • 9.5.2.6 - Process and distribute manual checks (10863)
      • 9.5.2.7 - Process period-end adjustments (10864)
      • 9.5.2.8 - Respond to employee payroll inquiries (10865)
    • 9.5.3 - Manage and process payroll taxes (10755)
      • 9.5.3.1 - Develop tax plan (14075)
      • 9.5.3.2 - Manage tax plan (14076)
      • 9.5.3.3 - Calculate and pay applicable payroll taxes (10866)
      • 9.5.3.4 - Produce and distribute employee annual tax statements (10867)
      • 9.5.3.5 - File regulatory payroll tax forms (10868)
  • 9.6 - Process accounts payable and expense reimbursements (10733)
    • 9.6.1 - Process accounts payable (AP) (10756)
      • 9.6.1.1 - Verify AP pay file with purchase order vendor master file (10869)
      • 9.6.1.2 - Maintain/Manage electronic commerce (10870)
      • 9.6.1.3 - Audit invoices and key data in AP system (10871)
      • 9.6.1.4 - Approve payments (10872)
      • 9.6.1.5 - Process financial accruals and reversals (10873)
      • 9.6.1.6 - Process payables taxes (10874)
      • 9.6.1.7 - Research/Resolve payable exceptions (10875)
      • 9.6.1.8 - Process payments (10876)
      • 9.6.1.9 - Respond to AP inquiries (10877)
      • 9.6.1.10 - Retain records (10878)
      • 9.6.1.11 - Adjust accounting records (10879)
    • 9.6.2 - Process expense reimbursements (10757)
      • 9.6.2.1 - Establish and communicate expense reimbursement policies and approval limits (10880)
      • 9.6.2.2 - Capture and report relevant tax data (10881)
      • 9.6.2.3 - Approve reimbursements and advances (10882)
      • 9.6.2.4 - Process reimbursements and advances (10883)
      • 9.6.2.5 - Manage personnel accounts (10884)
    • 9.6.3 - Manage corporate credit cards (20929)
      • 9.6.3.1 - Establish corporate credit card policies and approval limits (20930)
      • 9.6.3.2 - Process corporate credit card requests (20931)
      • 9.6.3.3 - Order corporate credit cards (20932)
      • 9.6.3.4 - Manage corporate credit card accounts (20933)
      • 9.6.3.5 - Approve/Change credit limits (20934)
      • 9.6.3.6 - Cancel/Deactivate credit card (20935)
  • 9.7 - Manage treasury operations (10734)
    • 9.7.1 - Manage treasury policies and procedures (10758)
      • 9.7.1.1 - Establish scope and governance of treasury operations (10885)
      • 9.7.1.2 - Establish and publish treasury policies (10886)
      • 9.7.1.3 - Develop treasury procedures (10887)
      • 9.7.1.4 - Monitor treasury procedures (10888)
      • 9.7.1.5 - Audit treasury procedures (10889)
      • 9.7.1.6 - Revise treasury procedures (10890)
      • 9.7.1.7 - Develop and confirm internal controls for treasury (10891)
      • 9.7.1.8 - Define system security requirements (10892)
    • 9.7.2 - Manage cash (10759)
      • 9.7.2.1 - Manage and reconcile cash positions (10893)
      • 9.7.2.2 - Manage cash equivalents (10894)
      • 9.7.2.3 - Process and oversee electronic fund transfers (EFTs) (10895)
      • 9.7.2.4 - Develop cash flow forecasts (10896)
      • 9.7.2.5 - Manage cash flows (10897)
      • 9.7.2.6 - Produce cash management accounting transactions and reports (10898)
      • 9.7.2.7 - Manage and oversee banking relationships (10899)
      • 9.7.2.8 - Analyze, negotiate, resolve, and confirm bank fees (10900)
    • 9.7.3 - Manage in-house bank accounts (10760)
      • 9.7.3.1 - Manage in-house bank accounts for subsidiaries (10901)
      • 9.7.3.2 - Manage and facilitate inter-company borrowing transactions (10902)
      • 9.7.3.3 - Manage centralized outgoing payments on behalf of subsidiaries (10903)
      • 9.7.3.4 - Manage central incoming payments on behalf of subsidiaries (10904)
      • 9.7.3.5 - Manage internal payments and netting transactions (10905)
      • 9.7.3.6 - Calculate interest and fees for in-house bank accounts (10906)
      • 9.7.3.7 - Provide account statements for in-house bank accounts (10907)
    • 9.7.4 - Manage debt and investment (10761)
      • 9.7.4.1 - Establish investment policy (14079)
      • 9.7.4.2 - Manage financial intermediary relationships (10908)
      • 9.7.4.3 - Manage liquidity (10909)
      • 9.7.4.4 - Manage issuer exposure (10910)
      • 9.7.4.5 - Process and oversee debt and investment transactions (10911)
      • 9.7.4.6 - Process and oversee foreign currency transactions (10912)
      • 9.7.4.7 - Produce debt and investment accounting transaction reports (10913)
      • 9.7.4.8 - Process and oversee interest rate transactions (14210)
    • 9.7.5 - Monitor and execute risk and hedging transactions (11208)
      • 9.7.5.1 - Develop risk management/hedging strategy (12974)
      • 9.7.5.2 - Manage interest rate risk (11209)
        • 9.7.5.2.1 - Manage interest rate market data (19575)
        • 9.7.5.2.2 - Determine interest rate exposure for all markets (19576)
        • 9.7.5.2.3 - Determine interest rate hedge requirements in accordance with risk policy (19577)
        • 9.7.5.2.4 - Execute interest rate trades (19578)
      • 9.7.5.3 - Manage foreign exchange risk (11210)
        • 9.7.5.3.1 - Manage foreign exchange market data (19579)
        • 9.7.5.3.2 - Determine foreign exchange exposure for all currencies (19580)
        • 9.7.5.3.3 - Determine foreign exchange hedge requirements in accordance with risk policy (19581)
        • 9.7.5.3.4 - Execute foreign exchange trades (19582)
        • 9.7.5.3.5 - Manage foreign exchange balance sheet risk (19583)
      • 9.7.5.4 - Manage exposure risk (11211)
        • 9.7.5.4.1 - Determine current customer exposures and limit exceptions (19584)
        • 9.7.5.4.2 - Resolve customer exposure limit violations (19585)
        • 9.7.5.4.3 - Manage customer collateral (19586)
        • 9.7.5.4.4 - Perform annual customer credit reviews (19587)
      • 9.7.5.5 - Execute hedging transactions (20137)
        • 9.7.5.5.1 - Measure physical positions (19588)
        • 9.7.5.5.2 - Establish hedges (19589)
        • 9.7.5.5.3 - Unwind hedges (19590)
        • 9.7.5.5.4 - Evaluate and refine hedging positions (11213)
        • 9.7.5.5.5 - Monitor credit (11215)
      • 9.7.5.6 - Produce hedge accounting transactions and reports (11214)
    • 9.7.6 - Manage financial fraud/dispute cases (16958)
  • 9.8 - Manage internal controls (10735)
    • 9.8.1 - Establish internal controls, policies, and procedures (10762)
      • 9.8.1.1 - Establish board of directors and audit committee (10914)
      • 9.8.1.2 - Define and communicate code of ethics (10915)
      • 9.8.1.3 - Assign roles and responsibility for internal controls (10916)
      • 9.8.1.4 - Define business process objectives and risks (11250)
      • 9.8.1.5 - Define entity/unit risk tolerances (11251)
    • 9.8.2 - Operate controls and monitor compliance with internal controls policies and procedures (10763)
      • 9.8.2.1 - Design and implement control activities (10917)
      • 9.8.2.2 - Monitor control effectiveness (10918)
      • 9.8.2.3 - Remediate control deficiencies (10919)
      • 9.8.2.4 - Create compliance function (10920)
      • 9.8.2.5 - Operate compliance function (10921)
      • 9.8.2.6 - Implement and maintain controls-related enabling technologies and tools (10922)
    • 9.8.3 - Report on internal controls compliance (10764)
      • 9.8.3.1 - Report to external auditors (10923)
      • 9.8.3.2 - Report to regulators, share-/debt-holders, securities exchanges, etc. (10924)
      • 9.8.3.3 - Report to third parties (10925)
      • 9.8.3.4 - Report to internal management (10926)
  • 9.9 - Manage taxes (10736)
    • 9.9.1 - Develop tax strategy and plan (10765)
      • 9.9.1.1 - Develop foreign, national, state, and local tax strategy (10927)
      • 9.9.1.2 - Consolidate and optimize total tax plan (10928)
      • 9.9.1.3 - Maintain tax master data (10929)
    • 9.9.2 - Process taxes (10766)
      • 9.9.2.1 - Perform tax planning/strategy (10930)
      • 9.9.2.2 - Prepare tax returns (10931)
      • 9.9.2.3 - Prepare foreign taxes (10932)
      • 9.9.2.4 - Calculate deferred taxes (10933)
      • 9.9.2.5 - Account for taxes (10934)
      • 9.9.2.6 - Monitor tax compliance (10935)
      • 9.9.2.7 - Address tax inquiries (10936)
  • 9.10 - Manage international funds/consolidation (10737)
    • 9.10.1 - Monitor international rates (10767)
    • 9.10.2 - Manage transactions (10768)
    • 9.10.3 - Monitor currency exposure/hedge currency (10769)
    • 9.10.4 - Report results (10770)
  • 9.11 - Perform global trade services (17059)
    • 9.11.1 - Screen sanctioned party list (14090)
    • 9.11.2 - Control exports and imports (14091)
    • 9.11.3 - Classify products (14092)
    • 9.11.4 - Perform currency conversion (19593)
    • 9.11.5 - Calculate duty (14093)
    • 9.11.6 - Communicate with customs (14094)
    • 9.11.7 - Document trade (14095)
    • 9.11.8 - Process trade preferences (14096)
    • 9.11.9 - Handle restitution (14097)
    • 9.11.10 - Prepare letter of credit (14098)