What is it?
The sum of a company’s current assets and non-current assets.
Current assets are assets used in the short-term. Current assets on the balance sheet contain all of the assets that are likely to be converted into cash within one year. Companies rely on their current assets to fund ongoing operations and to pay current expenses. Current assets include cash, inventory, and accounts receivables.
Noncurrent assets are a company’s long-term investments or assets that have a useful life of more than one year and usually last for several years. Noncurrent assets are considered illiquid, meaning they can’t be easily liquidated into cash. Long-term assets are considered noncurrent assets and the two terms are used interchangeably.
Who is interested?
The financial community and investors.
What does it tell me?
The total book value of a company’s assets adjusted for depreciation. Investors use total assets for valuation purposes and to measure a company’s effectiveness of operations.