A simple percentage comparison between the profits generated by a business and the assets used or utilised to generate that profit. Eg I have Â£1 Million assets in a business and make Â£100,000 profits per annum = 10% Return On Assets
I make a Â£1 Million profit every year. This sounds good, but if I have used Â£100 Million of cash and business assets to generate this amount then this return is not so good after all. This is because I have only returned 1% on the assets used in the business to realise this profit.