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Financial performance measures in the private sector




               2.4 Measuring risk

                             Also needs to considers since measures the ability of the organisation
                             to meet its liabilities.




                             Measures include:

                                  Financial gearing = (long-term debt÷ shareholders’ funds) × 100

                                   or = (long-term debt÷ (long-term debt + shareholders’ funds))
                                   × 100

                                  Operating gearing = fixed costs ÷ variable costs


                                  Interest cover = PBIT ÷ interest charges





















































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