Solvency: the meaning
The share of the company funded with its own means rather than debt.
The higher the solvency, the better a company can absorb losses. The sector matters: real estate and trade often sit lower.
How to read it
Above 30 percent is healthy, above 50 strong. Below 15 percent the buffer is thin.
On Nummo you find this figure in the Figures tab of every company that filed annual accounts, over the years. In the tables, a small card gives this explanation in short.
How to calculate it
equity ÷ total assets (in belgian annual accounts: 10/15 ÷ 20/58)
The item numbers follow the official format of Belgian annual accounts, which builds on the European Accounting Directive.
More: Solvency ratio: formula, example and what is good →
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