How is Total Invested Capital calculated?

Total Invested Capital is key in measuring the efficiency & profitability of investments

Calen Olesen avatar
Written by Calen Olesen
Updated over a week ago


Formula for Total Invested Capital

Total Invested Capital =

Total Current Assets - Total Operating Liabilities (i.e. Current Liabilities excluding any debt) + Total Non-Current Assets

Fathom uses Total Invested Capital as a variable to calculate the Activity Ratio, Economic Profit, and Return on Capital Employed (ROCE) for a business. All three metrics measure the efficiency or profitability of a business's invested capital.

Where can I see the numbers?

The best way to determine how Total Invested Capital is calculated is to go to the Financial Statements tool in Fathom.

In the 'Balance Sheet' view, select 'Separation of Operations and Finance' as the layout. 'Total Invested Capital' will then be listed in the Balance Sheet along with 'Total Current Assets', 'Total Operating Liabilities', and 'Total Non-Current Liabilities'.

Additional knowledge & common questions:

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