Finance Essentials

The Practitioners' Guide

Scott Moeller

• Publisher: Bloomsbury Information
• Year: 2012
• Print ISBN: 9781849300407
• eBook ISBN: 9781849300599
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

Collated by Scott Moeller of Cass Business School, this collection brings together the informative articles a budding finance practitioner needs to operate effectively in today's corporate environment. Bringing together core finance knowledge and cutting-edge research topics in an engaging and effective way, this text is the ideal companion for all practitioners and students of finance. You will find insights into the practical applications of theory in key areas such as balance sheets and cash flow, financial regulation and compliance, funding and investment, governance and ethics, mergers and acquisitions, and operations and performance. Contributors to this collection include some of the leading experts in their respective fields: Aswath Damodaran, Harold Bierman, Jr, Andreas Jobst, Frank J. Fabozzi, Ian Bremmer, Javier Estrada, Marc J. Epstein, Henrik Cronqvist, Daud Vicary Abdullah, Meziane Lasfer, Dean Karlan, Norman Marks, Seth Armitage, and many others. In this collection you will discover: * Over 80 best-practice articles, providing the best guidance on issues ranging from risk management and capital structure optimization through to market responses to M&A transactions and general corporate governance * Over 65 checklists forming step-by-step guides to essential tasks, from hedging interest rates to calculating your total economic capital * 55 carefully selected calculations and ratios to monitor firms' financial health * A fully featured business and finance dictionary with over 5, 000 definitions

DICTIONARY
a-z

A

AAA¹ abbr ACCOUNTING American Accounting Association

AAA² STOCKHOLDING & INVESTMENTS top investment rating the maximum safety rating given to potential investments by Standard & Poor’s or Moody’s, the two best-known rating agencies. Also called triple A

AAD abbr CURRENCY & EXCHANGE Arab Accounting Dinar

AASB abbr ACCOUNTING Australian Accounting Standards Board

AAT abbr ACCOUNTING Association of Accounting Technicians

ABA abbr BANKING American Bankers Association

abacus FINANCE frame holding rods strung with beads for calculating a counting device used for making basic arithmetic calculations, that consists of parallel rods strung with beads. Still widely used in education worldwide and for business and accounting in China and Japan, its origins can be traced back to early civilizations. Australia’s oldest accounting journal bears the same name.

abandonment option STOCKHOLDING & INVESTMENTS early investment-termination option the option of terminating an investment before the time that it is scheduled to end

abandonment value STOCKHOLDING & INVESTMENTS value of investment terminated early the value that an investment has if it is terminated at a particular time before it is scheduled to end

ABA routing number BANKING number allocated to US financial institution in the United States, a nine-digit number allocated to a financial institution, such as a bank. It appears on US checks in the bottom-left corner. Also called routing number. See also sort code

abatement FINANCE decrease in debt obligation a reduction in an amount of a liability, for example, in the amount of a person’s debts, or in a company’s costs of paying employee benefits

ABB abbr TREASURY MANAGEMENT activity based budgeting

abbreviated accounts ACCOUNTING abridged UK company accounts in the United Kingdom, a shortened version of a company’s annual accounts that a company classified as small- or medium-sized under the Companies Act (1989) can file with the Registrar of Companies, instead of having to supply a full version

ABC abbr ACCOUNTING activity based costing

abnormal loss ACCOUNTING loss exceeding normal allowance any loss which exceeds the normal loss allowance. Abnormal losses are generally accounted for as though they were completed products.

abnormal shrinkage ACCOUNTING shrinkage contributing to abnormal loss the unexpectedly high level of reduction in inventory that has contributed to an abnormal loss

abnormal spoilage ACCOUNTING shortfall contributing to abnormal loss the unexpectedly high level of shortfall that has contributed to an abnormal loss

abnormal waste ACCOUNTING waste contributing to abnormal loss the unexpectedly high level of waste that has contributed to an abnormal loss

above par STOCKHOLDING & INVESTMENTS trading above face value used to describe a security that trades above its nominal value or redemption value

above-the-line 1. ACCOUNTING indicating exceptional items in accounts used to describe entries in a company’s profit and loss accounts that appear above the line separating those entries that show the origin of the funds that have contributed to the profit or loss from those that relate to its distribution. Exceptional and extraordinary items appear above the line. See also below-the-line (sense 1) 2. ECONOMICS indicating country’s revenue transactions in macroeconomics, used to describe a country’s revenue transactions, as opposed to its below-the-line or capital transactions. See also below-the-line (sense 2) 3. MARKETING relating to marketing costs for advertising used to describe marketing expenditure on advertising in media such as the press, radio, television, film, and the World Wide Web, on which a commission is usually paid to an agency. See also below-the-line (sense 3)

abridged accounts ACCOUNTING provisional UK company financial statement in the United Kingdom, financial statements produced by a company that fall outside the requirements stipulated in the Companies Act. Abridged accounts are often made public through the media.

ABS abbr 1. STOCKHOLDING & INVESTMENTS asset-backed security 2. STATISTICS Australian Bureau of Statistics

absolute advantage ECONOMICS favorable position of regions having low production costs an advantage enjoyed by a country or area of the world that is able to produce a product or provide a service more cheaply than any other country or area

absorb ACCOUNTING merge production overhead costs to assign an overhead to a particular cost center in a company’s production accounts so that its identity becomes lost. See also absorption costing

absorbed account ACCOUNTING account merged with related accounts an account that has lost its separate identity by being combined with related accounts in the preparation of a financial statement

absorbed business MERGERS & ACQUISITIONS firm combined with another a company that has been merged into another company with which it is not on an equal footing

absorbed costs ACCOUNTING indirect manufacturing costs the indirect costs associated with manufacturing, for example, insurance or property taxes

absorbed overhead ACCOUNTING locally adjusted overhead an overhead attached to products or services by means of absorption rates

absorption costing ACCOUNTING method allocating overhead costs to product an accounting practice in which fixed and variable costs of production are absorbed by different cost centers. Providing all the products or services can be sold at a price that covers the allocated costs, this method ensures that both fixed and variable costs are recovered in full. However, if sales are lost because the resultant price is too high, the organization may lose revenue that would have contributed to its overhead. See also marginal costing

absorption rate ACCOUNTING rate of merging production overhead costs the rate at which overhead costs are absorbed into each unit of production

ACA 1. ACCOUNTING ICAEW Associate Chartered Accountant an Associate (member) of the Institute of Chartered Accountants in England and Wales 2. abbr REGULATION & COMPLIANCE Australian Communications Authority

Academy of Accounting Historians ACCOUNTING US institution for accounting history a US organization founded in 1973 that promotes “research, publication, teaching, and personal interchanges in all phases of Accounting History and its interrelation with business and economic history”

ACAUS abbr ACCOUNTING Association of Chartered Accountants in the United States

ACCA abbr ACCOUNTING Association of Chartered Certified Accountants

accelerated cost recovery system ACCOUNTING use of asset depreciation to reduce US taxes in the United States, a system used for computing the depreciation of some assets acquired before 1986 in a way that reduces taxes. Abbr ACRS

accelerated depreciation ACCOUNTING assigning higher depreciation to new assets a system used for computing the depreciation of some assets in a way that assumes that they depreciate faster in the early years of their acquisition. The cost of the asset less its residual value is multiplied by a fraction based on the number of years of ...

Table of contents

• Cover
• Title Page
• Contents
• Introduction
• Contributor Biographies
• Best Practice
• Checklists
• Calculations and Ratios
• Dictionary
• Imprint