Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, July 18, 1995                   TAG: 9507180092
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A-3   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

NRA CREDIT RATING SHOT DOWN BY AGENCY

Dun & Bradstreet, which evaluates the financial strength and credit worthiness of corporations, businesses and municipalities, gave the NRA a rating of 9 on its scale of credit risk.

Such a rating generally is reserved for companies with extreme financial difficulties and could make it harder for the organization to do business with banks and contractors. By contrast, a rating of 1 would be assigned to the most financially sound entities.

The Dun & Bradstreet report, prepared June 30 for an individual involved in the NRA's operations, was obtained by The Associated Press.

An NRA spokesman, Bill Powers, declined comment. But the gun lobby has said that it is operating in the black this year.

Dun & Bradstreet spokesman Joe Eckert would not comment.

Banks, insurance companies and vendors typically pay Dun & Bradstreet to do such analyses to determine whether they should do business with a company or group, and on what terms.

The Dun & Bradstreet evaluation comes on the heels of an AP report that showed the NRA has depleted its cash and investments by more than half since 1991 and has been running in the red for the last four years with a cumulative deficit of at least $60 million.

Dun & Bradstreet based its assessment on 1993 financial summaries provided by the NRA. Such rankings can change dramatically if the rating agency obtains more detailed information, or if the organization's financial situation changes.

In the four-page report, Dun & Bradstreet cited several reasons for its poor credit assessment of the NRA. They include reported losses and payments made an average of 15 days late, compared with an average of six days late by other nonprofit groups that Dun & Bradstreet studies.

The document, which said that the NRA had just $49.4 million in cash and investments, concluded, ``This business has a deficit tangible net worth.''

``What that means,'' said James Nesbitt, an accountant with BDO Seidman who specializes in auditing nonprofit groups like the NRA, ``is that Dun & Bradstreet sees an organization that has dug itself a deep hole due to the fact that its liabilities exceed its assets by so much.''

Nesbitt, who reviewed the Dun & Bradstreet report at AP's request, said he was not surprised by the rating agency's conclusions.

``A general rule of thumb used by many accountants is that debt should not exceed an organization's equity,'' Nesbitt said. ``Here, the equation is so lopsided that it's further evidence of the deterioration of their financial picture.''

Nesbitt said the analysis could make banks and contractors reluctant to do business with the NRA. An individual close to the NRA said at least one of the group's contractors recently requested and received the Dun & Bradstreet analysis.