Georgia's universe of public corporations ranges in size from close to $100 billion in market value at the top, with companies such as Coca-Cola and UPS, to as little as $5 million to $10 million at the bottom.

How can companies on that spectrum be compared fairly?

That's the job — the challenge — of the Georgia 100, which measures and then compares how these companies perform individually.

"Performance" refers to what a company's management did with the resources it had in the economic and market environment it shared with peers and competitors, in this case during their 2005 fiscal years.

Fortune magazine ranks companies on its 500 and 1,000 lists according to revenue, which means its annual list is skewed toward big companies.

The smallest company by revenue on this year's Fortune 500 is LandAmerica Financial Group of Richmond, with revenue of $3.96 billion.

Another way to rank companies is by percentage changes from year to year in some variable such as profits or sales.

While that seems fair, it also gives small and very small companies an advantage, since they can post big percentage changes on comparatively small numbers.

Ranking companies by their performance attempts to get around this problem with a mix of absolute and percentage variables.

The process begins with a list of about 170 publicly traded companies that meet certain minimum standards for variables such as market value, frequency of trading and price history. And they must be headquartered in Georgia.

Companies that fail to file relevant financial documents with the Securities and Exchange Commission by the deadline set by the publication timetable are omitted, along with companies whose auditors issue a "going concern" opinion.

Some companies file late because of regulatory investigations or other legal matters that make on-time reporting impossible.

For the remaining universe of 145 companies, analysts in the Atlanta office of PricewaterhouseCoopers LLP, an international accounting and business consulting firm, retrieved relevant financial data from the firms' annual 10-K reports to the SEC.

The 5 components

The analysts applied five weighted variables to come up with the final ranking:

• Annual revenue, which represents 10 percent of the final score. For banks, revenue is determined by adding net interest income and noninterest income.

• Year-over-year revenue change (15 percent).

• Annual percent change in profit margin, based on net income available to common shareholders (15 percent).

• Return on equity (30 percent), or how much profit is produced on shareholders' investment.

• Total return for calendar 2005 (30 percent), or the change in stock price assuming any dividends were reinvested in the company's shares.

The companies were ranked for each of these measures.

The overall ranking was then determined by totaling the five variable rankings for each company and dividing by five.

Unlike most scoring, smaller is better in this case — the lower the final score, the higher the rank.

Profit numbers used to rank the companies were from continuing operations, net of any preferred dividends, and excluded income or loss from discontinued operations as well as changes in accounting principles.

While total return was for calendar 2005, all other financial data were for the companies' fiscal years, even if different. In most cases — but not all — the fiscal and calendar years coincide.

The purpose of the Georgia 100 is not to give bragging rights to companies on the list — although that happens. Instead, the information in this section is intended to be a starting point for an investor's money management.

Investors are expected to do more homework before they add one or more of these companies to a portfolio — or delete it, as the case may be.