Above Water
 |
Definition of 'Above Water'1. Refers to the condition of a company's asset when its actual value is higher than the book value used in its financials.2. Financially referring to a person staying out of economic trouble or a company remaining financially viable. |
 |
Investopedia explains 'Above Water'1. Generally, the book value of an asset listed in a company's balance sheet cannot be adjusted according to Generally Accepted Accounting Principles (GAAP). Should the asset appreciate, its market value would be "above water". A company with above water assets tends to attract value investors. This is because of the hidden value that most investors won't discover if they don't look beyond the financials. For example, if a company purchased a piece of land for $100,000 and the company later discovered an oil reserve on the property, the market value of the land would increase and be above water, because the book value would remain at $100,000.2. Used in the context of "keeping their head above water" symbolizing the ability to stay alive. For example, company XYZ kept its head above water with an increase in profit even though its revenue dropped. |
Related Definitions
Articles Of Interest
-
Understanding Pro-Forma Earnings
These figures can either shed light on a company's performance or skew it. Find out why. -
Can You Count On Goodwill?
Carefully examine goodwill and its sources before considering the value of your investment. -
Intangible Assets Provide Real Value To Stocks
Intangible assets don't appear on balance sheets, but they're crucial to judging a company's value. -
What's the difference between bottom-line and top-line growth?
A company's bottom line is its net income, or the "bottom" figure on a company's income statement. More specifically, the bottom line is a company's income after all expenses have been deducted ... -
What does it mean to be "above water"?
The term "above water" is used to describe any situation in which the ending or current value of a subject is higher than its beginning or opening price. In accounting, an asset with a value ... -
Earnings Guidance: Can It Accurately Predict The Future?
Explore the controversies surrounding companies commenting on their forward-looking expectations. -
Depreciation: Straight-Line Vs. Double-Declining Methods
Appreciate the different methods used to describe how book value is "used up". -
Financial Statement: Extraordinary Vs. Nonrecurring Items
When it comes to analyzing a company, successful analysts spend considerable time differentiating between accounting items that are likely to recur going forward from those that most likely will ... -
Get A Career In Showbiz Accounting
An accounting career doesn't have to be boring. If you love numbers, but want excitement as well, consider the field of showbiz accounting. -
What Management Accountants Do
If you like keeping track of a company's income and expenses but also want to hold a position with significant responsibility and authority, management accounting could be the job for you.
Free Annual Reports
