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| Glossary |
| Allocation of resources: Distributing
any available limited resources over various operations, periods, or products. Assets: Anything of value owned by a corporation. Balance sheet: The summary of financial condition of a organization at a specific of time which includes its assets, liability, income and expenditure. Board of directors: Individuals who oversee the management of a company. The shareholders of the company elect these individuals. Capital markets: A market where long term or indefinite maturity financial instruments and assets are traded. Cash flow: Refers to cash receipts of a company minus its cash payments Claim: Requesting for any amount due under certain terms. Credit rating: A ranking given by a independent agency based on a detailed financial analysis. Lenders to approve a loan use this rating. Current assets: An asset that could be converted to cash in less than one year. The term includes account receivables, cash equivalents, inventory etc Current liabilities: All sums payable by a company within one year. Includes account payables etc. Debtors: Money due to a company for products sold or services provided on credit. Defaulters: Any person who fails to make the required payments as per agreement at a required time Discount rate: The rates used for discounting the future cash flows Estimates: Probable quantitative information for the future. Expenditure: A payment or a promise for future payments Financial activity: Any activity that has monetary implications. Financial institutions: Institution that collects money from public and invests them in various assets Financial management: Managing acquisition of funds and utilization of those acquired funds Forecasting: Predict the future trends by analyzing the present and historical information available Guarantee: The acceptance of responsibility to pay in case of default by the borrower Income: Net revenue earned by the company after deducting its expenses Inflation: The general upward movements of prices of goods and services in an economy. It is usually measured by an index Inflows: All cash payments received or receivable by a company. Interest: The income earned by a lender for lending his money. Usually a percentage of money lent Inventory: A company's products, raw materials, and finished and unfinished goods that are yet to be sold Investment: The use of money in order to make more money Liquidation: To sell all the assets of the company, pay the debts, give any reminder to shareholders and close the business. Long-term instruments: Any financial instrument that is valid for a longer term Merge: Combining two different corporations either through acquisition of shares or pooling of the shares Outflows: All cash payments made or payable by a company. Pre-requisites: Specific conditions that have to be satisfied before a process can start Primary market: The market where the new shares are issued Private companies: A company whose shares are not traded in the market Rate of return: The return earned on an investment usually as a percentage of amounts invested Resource: An available source of wealth, that can be drawn upon when needed Revenue: Earning by a company for goods sold and services rendered. Short-term instruments: Financial instruments valid for one year or less. Usually refer to bonds Takeover: Acquiring ownership of another corporation either through purchase or exchange of shares Trade: Any transaction of a financial instrument. Treasury bills: Any instrument backed by governments usually having a maturity of less than one year. Venture: Any enterprise or investment that involves high risk. It can give high returns or lead to losses. |
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