ABSTRACT
Over a decade ago, sensing that existing paradigms for assessing financial condition were too complex for most governments to use, a professor from Southwest Missouri State University introduced a relatively simple analytical tool that has become widely popular among finance officers and financial analysts alike. Dr. Ken W. Brown’s (1993) ‘‘10-point test’’ employed ten ratios indicative of factors relevant to financial condition. Using the 10-point test, a government would calculate the ratios and would gain or lose points depending on how favorably or unfavorably the ratios compared with the ratios of governments with similarly-sized populations. The resulting sum, when compared with other, similar governments, or with the results of previous years for the same government, could provide
a quick read of a government’s financial standing (Koloziej, Rogers and Gardner, 1994).
