2.3.1.1 Net Worth
Net worth is the difference between assets and liabilities. Assets are what a firm owns and liabilities are what a firm owes to outsiders. Net worth is also called “owners’ equity” because it is what is left over of the assets when all the creditors are paid off. On a balance sheet, assets must always equal liabilities plus owners’ equity.
Adjustments to net worth. Net worth is usually calculated from the assets and liabilities contained on the firm’s balance sheet. For purposes of calculating net capital, the SEC requires certain adjustments to be made to a broker-dealer’s net