Net worth


Net worth

In business, net worth (sometimes called net assets) is the total assets minus total outside liabilities of an individual or a company. For a company, this is called shareholders' preference and may be referred to as book value. Net worth is stated as at a particular year in time. In the case of an individual, the term estate is used in relation to deceased individuals in probate. For businesses, the term is used in the context of fraudulent law and on the dissolution of the company.

In personal finance, net worth (or wealth) refers to an individual's net economic position; similarly, it uses the value of all assets (long term assets) minus the value of all liabilities.

Net worth in business is generally based on the value of all assets and liabilities at the carrying value which is the value as expressed on the financial statements. To the extent items on the balance sheet do not express their true (market) value, the net worth will also be inaccurate.

Net worth in this formulation is not an expression of the market value of the firm: the firm may be worth more (or less) if sold as a going concern.

On reading the balance sheet, if the accumulated losses exceed the shareholder's equity, it is a negative value for net worth.


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Look at other dictionaries:

  • net worth — n: the excess of the value of assets over liabilities: net assets at asset 2 Merriam Webster’s Dictionary of Law. Merriam Webster. 1996 …   Law dictionary

  • net worth — (izg. nȅt vȏrt) m DEFINICIJA ekon. stvarna vrijednost imovine vlasnika poduzeća, iskazana kao razlika koja preostane kada se od stvarne vrijednosti aktive poduzeća odbiju svi dugovi (dobavljačima, bankama i sl.) ETIMOLOGIJA engl …   Hrvatski jezični portal

  • net worth — /net wɜ:θ/ adjective the value of all the property of a person or company after taking away what the person or company owes ● The upmarket product is targeted at individuals of high net worth …   Marketing dictionary in english

  • net worth — /net wɜ:θ/ noun the value of all the property of a person or company after taking away what the person or company owes ● The upmarket product is targeted at individuals of high net worth …   Dictionary of banking and finance

  • net worth — the owner/s interest in a business, calculated by subtracting all liabilities from the assets of the business. Glossary of Business Terms common stockholders equity which consists of common stock, surplus, and retained earnings. Bloomberg… …   Financial and business terms

  • Net worth — Common stockholders equity which consists of common stock, surplus, and retained earnings. The New York Times Financial Glossary * * * net worth ˌnet ˈworth noun [uncountable] ACCOUNTING FINANCE the value of a company calculated by taking its… …   Financial and business terms

  • Net Worth — The amount by which assets exceed liabilities. This term can be applied to companies and individuals. For a company, this is known as shareholders (or owners ) equity and is determined by subtracting liabilities on the balance sheet from assets.… …   Investment dictionary

  • net worth — The amount by which assets exceed liabilities. Remainder after deduction of liabilities from assets. W. H. Miner, Inc. v. Peerless Equipment Co., C.C.A.I1L, 115 F.2d 650, 655. Difference between total assets and liabilities of individual,… …   Black's law dictionary

  • net worth — The amount by which assets exceed liabilities. Remainder after deduction of liabilities from assets. W. H. Miner, Inc. v. Peerless Equipment Co., C.C.A.I1L, 115 F.2d 650, 655. Difference between total assets and liabilities of individual,… …   Black's law dictionary

  • Net Worth — Filmdaten Deutscher Titel: Die Macht des Geldes Originaltitel: Net Worth Produktionsland: USA Erscheinungsjahr: 2000 Länge: 95 Minuten Originalsprache: Englisch …   Deutsch Wikipedia


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