Do you agree or disagree with this? Why or why not? What could be added to this discussion to help enhance it$?$

Financial leverage happens when a firm decides to finance most of its assets by taking on debt $($Smart$,$ S$.$ & Zutter, C$.,2022).$ Using too much financial leverage may undermine a company's financial stability. To help mitigate risks, CFOs closely monitor signs indicating excessive financial leverage, such as high debt$-$to$-$equity ratios, declining profitability and credit rating downgrades. A rising debt$-$to$-$equity ratio suggests heavy reliance on debt for financing, potentially signaling excessive financial leverage. Decreasing profitability metrics alongside increasing debt levels could indicate overleverage and a credit rating downgrade by agencies may cause concern regarding the firm's debt management capabilities $($Hayes$,$ A$.,2023).$

If these signs are encountered, CFOs could implement actions that include debt restructuring, focus on accelerating revenue growth, closely monitor credit quality trends, manage balance sheet flexibility, and implement efficiency initiatives to navigate the financial challenges associated with excessive financial leverage $($CFO Enrollment., $2023).$