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Ratios
AAT finance ratios
| Term | Definition |
|---|---|
| Return on Capital Employed | Profit from operations/total equity + Non current liabilities |
| Return on shareholders' funds | Profit after tax / total equity |
| Gross Profit Margin | Gross profit / Revenue |
| Expense percentage | Specified expenses / Revenue |
| Operating Profit percentage | Profit from operations / Revenue |
| Current Ratio | Current assets /current liabilities |
| Quick Ratio | Current assets - inventory / current liabilities |
| Inventory turnover | Cost of sales / Inventories = x times |
| Inventory holding period | Inventories / Cost of sales x 365 days |
| Receivables collection period | Receivables / revenue x 365 days |
| Payables payment period | Payables / cost of sales x 365 days |
| Working capital cycle | Inventory days + Receivables days - Payables days |
| Net Asset Turnover | Revenue / Total Assets - Current liabilities |
| Non Current Asset Turnover | Revenue / Non-current assets |
| Interest cover | Profit from Operations / Finance Costs |
| Gearing | Non current Liabilities / Total Equity + Non current liabilities |