Asset-liability ratio = total liabilities/total assets times 100%. This ratio shows that a part of enterprise assets is financed by debt. Total liabilities include short-term and long-term debts of the enterprise, and total assets are the sum of all assets of the enterprise. This ratio can reflect the degree of dependence on external debt and solvency of enterprises.
Influencing factors of asset-liability ratio:
1, company capital structure: different capital structures will lead to different asset-liability ratios;
2. Industry characteristics: the capital demand of different industries and the habit of using financial leverage will affect the asset-liability ratio;
3. Business strategy: the company's expansion strategy and risk preference will affect its asset-liability ratio;
4. Financial policy: the company's debt strategy and equity financing decision will affect the asset-liability ratio;
5. Macroeconomic environment: macroeconomic factors such as economic cycle and interest rate level will have an impact on asset-liability ratio;
6. Growth of the company: High-growth companies may tend to use more debt to support rapid development.
To sum up, the asset-liability ratio is calculated by multiplying the ratio of total liabilities to total assets by 100%, which reveals what proportion of the assets of the enterprise are financed by debt, and also reflects the dependence of the enterprise on foreign debt and its solvency.
Legal basis:
People's Republic of China (PRC) accounting law
Article 9
All units must conduct accounting according to actual economic and business matters, fill in accounting vouchers, register accounting books and prepare financial and accounting reports. No unit may use false economic and business matters or materials for accounting.
Accounting Standards for Enterprises-Basic Standards
Article 23
Liabilities refer to the current obligations formed by past transactions or events of an enterprise, which are expected to lead to the outflow of economic benefits from the enterprise. Current obligations refer to the obligations that the enterprise has undertaken under the current conditions. Obligations arising from future transactions or events are not current obligations and should not be recognized as liabilities.
Article 24
An obligation that meets the definition of liability stipulated in Article 23 of these Standards is recognized as a liability when the following conditions are met at the same time: (1) The economic benefits related to the obligation are likely to flow out of the enterprise; (2) The amount of economic benefits flowing out in the future can be measured reliably.