economists, think tanks, media organizations, and, most importantly, our readership gain the most accurate account of the financial performance and ownership status of the nation’s largest black-owned businesses.
In conducting due diligence for the 2004 BE INDUSTRIAL/SERVICE 100 list, BE AUTO DEALER 100 list, and the 15 companies that comprise the BE ADVERTISING AGENCIES list, BE Research and the BE 100S editorial team required all of the companies on these rankings to complete a survey that requested the following: total revenues for calendar year 2003, a detailed description of business activities, the company’s corporate structure, and confirmation that the entity is at least 51% black-owned or owns at least 51% of the controlling shares if the company is publicly traded. We also request historical data as to when the company came under majority black ownership. BE Research required that the CEO, CFO, or another current corporate officer sign and date the survey as verification of the validity of the information. And we don’t stop there. Once a company that received the survey responded, BE Research and the BE 100S editors made a series of phone calls to each company to verify survey information. They also checked the accuracy of financial and business information through government agencies, corporate purchasing offices, and industry reporting services such as Dun & Bradstreet.
Any company that received our survey and failed to provide financial information and confirmation of their black ownership, or that refused to respond to the queries of BE Research and our editors was not included on this year’s rankings. These a
re companies that have not proven their financial viability or our 51% black ownership requirement. Some of the more prominent companies that failed to meet these standards are Harpo Inc., The Heritage Companies, Luster Products, Bad Boy Entertainment, Sean John Clothing, Roc-A-Wear, and FUBU.
Our BE financial services firms also underwent a stringent due diligence process. With the assistance of Barge Consulting L.L.C., we consulted the Securities & Exchange Commission to get an accurate account of the filed assets under management of our asset management firms — those companies that make investments in equities and fixed-income vehicles for institutional and individual investors. Asset management firms that failed to register with the SEC — a criterion for making the BE ASSET MANAGERS list — were not included on this year’s ranking. For example, according to the SEC, New York-based Paradigm Capital Management hadn’t filed its assets under management for calendar year 2003 at the time of the development of this year’s list. Therefore, the firm was not included on this year’s ranking. Asset managers that could not reconcile their reported assets with those found in SEC filings were required to restate their financials and resubmit new surveys that more accurately reflected their assets under management for calendar year 2003. Firms refusing to comply with this request were not included on this year’s list.
To confirm the validity of the transactions of the nation’s largest black-owned investment banks — firms that provide underwriting services for institutions and government agencies and engage