This ratio calculates the relationship between a company’s debt and its effective tangible net worth, as increased by subordinated debt. As with "Debt / Worth", the lower the ratio the higher the degree of relative capitalization and the lower the degree of leverage. 

Formula:

(Total Liabilities – Subordinated Debt [included in long term liabilities]) / (Net Worth – Net Intangible Assets + Subordinated Debt [included in long term liabilities])

This calculation is available within the CASH|Suite Insight Application to assess financial capacity and risk.