Similar to the Sovereign Wikirating Index SWI, Wikirating wants to introduce a Corporation Wikirating Index (CWI), a simple, transparent and understandable rating method to assess companies’ credit worthiness. This rating methods for companies should aggregate a few identified and known criteria in order to calculate a reference credit rating.
Possible criteria for the CWI
- Net asset value (NAV)
- German income approach
- Cash flow
- Return On Investment (ROI)
- Equity-to-fixed-assets ratio (see below)
- Equity ratio
- Return on equity (ROE)
- Accounts receivable turnover
- Accounting liquidity
- Cost of purchased materials ratio
- Personnel expenses ratio
- Operating margin
- Debt-to-equity ratio
Equity-to-fixed-assets ratio
Equity-to-fixed-assets ratio, Shareholder Equity Ratio or fixed asset-to-equity capital ratio (inverse)
Definition
Equity-to-fixed-assets ratio (EFA ratio) is used to help determine how much shareholders would receive in case of a company -wide liquidation. The ratio is calculated by dividing equity capital by fixed assets of the firm, and it represents the amount of assets on which shareholders have a equity claim (also called a residual claim, a claim to a share of earnings after debt obligation have been satisfied). The figures used to calculate the ratio are taken from the company’s balance sheet.
Calculation
{\displaystyle {\text{EFA ratio}}={\frac {\text{Equity Capital}}{\text{Fixed Assets}}}}
Scaling factor
- Emission compared to other companies
- Brandindex (compared to other branches of business by www.interbrand.com)
- Corporate Social Responsibility
- Most Innovative Companies (by Forbes)
- Most Innovative Companies (by Visual Capitalist)
- Most Innovative Companies (by BCG)