AOTG: What is Debt to Asset Ratio in AOTG

Question: What is Debt to Asset Ratio in AOTG?

Answer:

The debt to assets ratio indicates the proportion of a company's assets that are being financed with debt, rather than equity. The ratio is used to determine the financial risk of a business.

A ratio greater than 1 shows that a considerable proportion of assets are being funded with debt, while a low ratio indicates that the bulk of asset funding is coming from equity.

A ratio greater than 1 also indicates that a company may be putting itself at risk of not being able to pay back its debts, which is a particular problem when the business is located in a highly cyclical industry where cash flows can suddenly decline.

To view the deb to asset ratio, login on to AOTG > Financial > Asset & Liabilities

System auto capture ratio by today’s date. Example: -0.073

You can refer Balance Sheet Statement for the figure taken to calculate Deb to Asset Ratio.

• to date filtering
• Assets = DR (Type: Assets) - CR (Type: Assets)
• Liabilities = CR (Type: Liabilities) - DR (Type: Liabilities)

Debt to Asset Ratio = Liabilities / Assets -1567.35 / 21607.47 = -0.073

By: CK 180618, KM 180618, P180628

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