capital adequacy ratio
Capital adequacy ratio is the sacred number meant to gauge a company's reliance on debt, in reality nothing but an internal fire alarm. A high ratio is hailed as virtuous, yet secretly a confession of shirking risk-taking. It becomes the boast of boardroom presentations and nothing more than chaff in actual investment decisions. Ultimately, it is the paradoxical touchstone of business that tests both the conscience of management and the wallets of shareholders.