Value-Added Tax (VAT) is a consumption tax imposed at each step of the production process, calculated as the difference between the purchase cost of an asset to the taxpayer and its resale price. It is a key source of tax revenue in many European countries.
Value-at-Risk (VaR) is a statistical technique developed to measure and quantify the level of financial risk within a firm or portfolio over a specific time frame. It represents the maximum potential loss with a given confidence level.
Value-at-Risk (VaR) is a statistical technique used to measure and quantify the level of financial risk within a firm or investment portfolio over a specific time frame.
Vanilla finance, also known as plain vanilla finance, refers to basic, standard financial instruments or products that lack any complex features or special conditions. These products are straightforward and easy to understand.
A variable is a data item that can change its value; it is also referred to as a factor or an element in various fields such as statistics, computer science, and mathematics.
A variable annuity is a type of life insurance annuity whose value fluctuates with that of an underlying securities portfolio or other index of performance. It contrasts with a conventional or fixed annuity, whose rate of return is constant.
Variable cost refers to expenses that change in proportion to the production output or sales volume. They fluctuate based on the operational activity, such as material costs, labor costs, and utility expenses.
Variable costs are expenses that change in proportion to the level of activity or volume of production a business undertakes.
The Variable Cost Ratio measures the ratio of variable costs to sales revenue, expressed as a percentage. It provides insight into the relationship between production costs and sales, crucial for cost management and pricing strategies.
Variable costing, also known as direct or marginal costing, is a managerial accounting method where only variable costs are included in the cost of a product.
Variable costs, or variable expenses, are business costs that fluctuate in direct proportion to changes in production or sales volume. They contrast with fixed costs, which remain constant regardless of production levels.
A variable interest rate is the amount of compensation to a lender that is allowed to vary over the maturity of a loan. It is generally governed by an appropriate index.
Variable Life Insurance is a type of life insurance policy where the face value and death benefit can fluctuate based on the performance of investments chosen by the policyholder. The value can increase or decrease but never falls below a guaranteed minimum.
Variable overhead costs represent the elements of an organization's indirect expenses for a product that change in total with fluctuations in production or sales levels. Examples include power, commissions earned by sales personnel, and consumable materials.
Understand the key concept of variable overhead efficiency variance within a standard costing system, and how it affects business financial performance.
Variable overhead expenditure variance in standard costing is the difference between the budgeted variable overhead expenses and the actual variable overhead expenses incurred.
In a system of standard costing, the total difference arising between the standard variable overhead absorbed for the actual units produced and the actual variable overhead expenditure incurred. See also Overhead Total Variance.
Variable pricing refers to a marketing strategy that allows different prices to be charged to different customers or at different times. This strategy is common among industries like airlines, hotels, and certain niche market sellers.
The elements of an organization's indirect manufacturing costs that vary in total in proportion to changes in the level of production or sales.
A Variable-Rate Note (VRN) is a type of bond with adjustable interest coupons set at regular intervals, reflecting the prevailing market rates.
A comprehensive overview of Variable-Rate Notes (VRNs), highlighting their characteristics, benefits, and implications for investors.
A variable-rate security is a financial instrument where the interest rate is not fixed but fluctuates in response to changes in market rates.
Variables sampling is a statistical method used primarily in auditing to predict the value of a given variable within a population. It is often used to estimate the total amount or the arithmetic mean of a characteristic within a sample.
Variance in standard costing and budgetary control refers to the difference between the standard or budgeted levels of cost or income for an activity and the actual costs incurred or income achieved.
Variance Analysis identifies the deviations in financial performance by analyzing the differences between planned financial outcomes and actual results, helping organizations make informed decisions and improve their operations.
A retail store carrying a variety of items in the low and popular price ranges, targeted for the family market, including apparel, women's accessories, gift items, and stationery.
An informal name for an employee of HM Revenue and Customs dealing with value added tax. It is often used to refer to a VAT Inspector responsible for routine VAT inspections.
Vault cash refers to the currency that a bank keeps on hand in its vault and ATMs to meet its day-to-day transaction needs.
The velocity of money refers to the frequency at which one unit of currency is used to purchase domestically-produced goods and services within a certain period. It is essential in understanding the health and efficiency of an economy.
A vendee is a buyer, particularly in the context of a contract for the sale of real estate.
A vendor is a seller, particularly one involved in the sale of real estate, but also encompassing suppliers, retailers, or street peddlers.
A vendor placing is a strategic financial maneuver used for acquiring another company or business, involving the placement of issued shares with prearranged investors as an alternative to direct cash transactions.
A Vendor's Lien is a collateral granted to the seller of a property as security for a promissory note taken by the seller as part of the selling price.
An entrepreneurial business undertaking involving a degree of risk, where capital is exposed to potential loss in pursuit of profit.
Venture capital is a form of private equity financing provided by venture capital firms or individual investors to early-stage, high-potential, and high-risk startup companies.
A Venture Capital Trust (VCT) is an investment vehicle in the United Kingdom designed to provide capital to small, expanding companies and give investors tax benefits.
Venture Capital Trusts (VCTs) offer a high-risk, high-reward investment avenue that provides risk capital for smaller unlisted trading companies, with the added advantage of certain tax benefits in the UK.
A management team assembled for the purpose of a new business operation. A venture team supervises and manages a start-up business, attending to all the details from raising venture capital to managing the initial operations.
A venturer is a party in a joint venture, an arrangement where two or more entities have joint control over an undertaking, sharing profits, losses, and control equally or as defined by a contractual agreement.
Verbatims are research reports that consist of word-for-word duplications of interviews or other forms of recorded communication, without any editorial comment.
The principle that the reliability (faithful representation) of the financial information provided by a company should be open to confirmation, i.e., that an independent person with a reasonable knowledge of accounting should be able to look at the same data and reach broadly similar conclusions. The International Accounting Standards Board's Conceptual Framework for Financial Reporting recognizes verifiability as a qualitative characteristic that enhances the usefulness of financial information.
Vertical analysis is a financial analysis method wherein each line item in a financial statement is listed as a percentage of a base item.
Vertical conflict represents the disagreements and disputes that arise between different hierarchical levels within the same channel of distribution, such as between manufacturers and retailers. This often results from mismatched objectives or perspectives regarding product sales and promotions.
A special reduced rate offered for the purchase of multiple radio or television time slots to be broadcast at intervals within a specified period of time, typically within a day.
The presentation of a financial statement where debits and credits are displayed one above the other.
Vertical integration refers to a strategy where a firm takes control over several production or distribution steps involved in the creation of its product or service. This can include owning the suppliers of raw materials, the manufacturing process, and the distribution channels.
Vertical integration involves the combination of companies operating at different stages within the same industry's supply chain. It strengthens control over production, distribution, and other critical steps, often resulting in increased efficiency and cost savings.
A detailed exploration of the hierarchical structure and functioning of an organization characterized by layers of management delegation of authority.
Vertical Marketing Systems (VMS) are systems where hierarchical distribution channel members coordinate marketing efforts to reduce conflicts and improve efficiency.
A vertical merger is a business combination in which members of a vertical channel of distribution merge, eliminating the middleman, potentially lowering costs, and possibly making a company more competitive if the savings are passed on to the consumer.
Vertical mobility refers to the movement of individuals or groups upward or downward in a social hierarchy, often resulting in a change in social status and economic position.
A hierarchically structured organization where all management activities are controlled by a centralized management staff, often leading to strong bureaucratic control.
Vertical promotion refers to the advancement or upgrading of management or supervisory responsibilities within an organization, often accompanied by an increase in compensation. For example, an individual receiving a promotion from a department manager to a vice president not only gains greater responsibilities but also receives higher remuneration.
Vertical specialization refers to the delegation of responsibilities and duties to others within the same line of authority in an organization. This happens as organizations grow more complex, necessitating the involvement of additional personnel to manage increasing workloads.
A vertical union is a labor union that includes workers from multiple crafts and unskilled occupations within the same industry, rather than grouping workers by specific trade or skill.
In financial and legal contexts, 'vest' generally refers to granting an individual full ownership of certain assets or benefits after meeting specific conditions, such as a period of service in a company.
A vested benefit is a benefit which an employee possesses full entitlement to, and will retain under any circumstances. Vesting ensures that the employee will retain specific benefits such as pension entitlements or shares, typically after serving the company for a specified period. The vesting status impacts how entities account for obligations under defined-benefit pension schemes or employee share plans.
A vested interest refers to a right or potential benefit in property that will certainly come about, or an involvement in an outcome that could lead to personal gain. This term is used in both legal and business contexts.
The entitlement of a pension plan participant to receive full benefits upon reaching the normal retirement age or a reduced benefit upon early retirement, regardless of their employment status with the same employer.
The Department of Veterans Affairs (VA) is a government agency that provides a wide range of services for eligible veterans, including loans, education benefits, and medical care.
Vicarious liability is a legal concept where one party is held liable for the actions or omissions of another person, even if the liable party did not personally commit the act. This is often seen in employer-employee relationships, where employers can be held accountable for the actions of their employees performed within the scope of their employment.
A vice-president (VP) is a corporate officer subordinate to the president, typically responsible for a specific functional area such as marketing, production, finance, or human resources.
A Vice-President (VP), often simply referred to as VP, is a senior executive in an organization who is responsible for various vital operational aspects and play a pivotal role in the strategic planning and decision-making process.
Videotex, also known as viewdata or interactive videotex, is a revolutionary system wherein information is transmitted via telephone lines between a computer and a TV screen, allowing for interactive data entry and retrieval.
A veteran who served in the U.S. armed forces during the Vietnam War and is entitled to employment preference on federal government contracts under the Veterans Readjustment Assistance Act.
Vigorish, often referred to as the 'vig,' is a term commonly used to describe usurious rates of interest or the charge taken by a bookmaker on bets.
A violation refers to an act or condition that is contrary to law or the permissible use of real property. It often leads to penalties such as fines and legal actions.
In certain systems of budgetary control, virement is an agreed practice allowing for the transfer of funds from one part of the budget to another within the financial year. This can help manage projected surpluses and deficits across different budget heads.
Virtual cooperation refers to a group of companies that form a temporary alliance using a computer network to accomplish a shared objective. This strategic collaboration allows businesses to leverage each other's strengths and resources without the need for physical proximity.
Visibility refers to the immediate insights that managers gain into a business operation through effective supply chain management. It involves tracking and managing all aspects of the supply chain process, from procurement of raw materials to delivery of the final product.
A vision is a comprehensive view of the future that can significantly influence and guide current management strategies. It serves as a long-term organizational goal, aligning efforts and providing a clear direction for future growth and development.
VocaLink is the company responsible for owning and operating the UK's national bank payments infrastructure. It works closely with Bacs, the automated payments scheme used by British banks, and LINK, the national network of cash machines.
Vocational guidance, also known as career counseling, is the process by which individuals are advised and aided in making career decisions. This involves understanding personal traits and preferences, assessing skills, exploring job opportunities, and matching these factors to suitable careers.
Vocational rehabilitation aims at equipping individuals with updated job skills to return to the workplace. This can involve various training programs and resources tailored to meet individual needs, ranging from simple skills like word processing to complex occupational tasks.
Voice activated systems are machines that can recognize and respond to spoken words, enabling hands-free operation and providing enhanced accessibility.
Voice over IP (VoIP) is a technology that enables the transmission of voice communications over data networks such as the Internet or corporate intranets. It is commonly referred to as Internet telephony. VoIP has revolutionized telecommunications by enabling voice calls to be transmitted over the internet, providing cost-effective and flexible communication solutions.
Voice recognition refers to a computer's ability to recognize spoken commands and act on them as if they were keyboard or mouse commands, and to enable dictation input. Despite advancements, the technology is still evolving and can produce errors even after training to accommodate a user's accent and speech.
Voicemail refers to messages that are received by telephone, recorded, and played automatically when the recipient requests them. Voicemail systems are computer-controlled, and messages are saved in digital form.
In legal terms, void refers to something that is null, empty, unenforceable, or incapable of ratification.
In legal terms, 'voidable' describes a situation where a legal obligation or transaction remains valid and enforceable unless an affected party chooses to void it. This legal classification often arises in contracts, where a defect that allows for annulment can be systematically asserted or proven in court. Until such action happens, the voidable act or agreement retains its legal force.
In finance and economics, the term 'volatile' refers to the tendency for rapid and extreme fluctuations in the price of a particular asset such as stocks, bonds, or commodities. Market-related volatility in stocks is typically measured by the Beta Coefficient.
A Voltage Regulator is a protective device that maintains electric line voltage within a prescribed range, protecting computers and other electronic devices from potential damage caused by power surges.
Volume can refer to the total number of stock shares traded, a set of periodical issues, or the amount of space occupied in three dimensions.
A Volume Discount is a pricing strategy where a seller offers a lower price per unit of a product when purchased in larger quantities. This encourages buyers to purchase more to gain the benefit of lower unit costs.
A manufacturer's discount offered to a retailer or wholesaler for buying large quantities of merchandise, encouraging bulk purchasing and long-term business relationships.
Volume variances refer to the differences between the actual volume of sales or production and the expected (budgeted or planned) volume. These variances can be further divided into specific categories like fixed overhead volume variance and sales margin volume variance.
A Voluntary Accumulation Plan is a financial strategy subscribed to by a mutual fund shareholder to accumulate shares in that fund over time. The shareholder decides both the investment amount and the investment intervals.
A detailed examination of Company Voluntary Arrangements (CVA) and Individual Voluntary Arrangements (IVA) as defined under the Insolvency Act 1986, including their objectives, processes, and key differences.
Voluntary bankruptcy is a legal proceeding initiated by the debtor who files a petition of bankruptcy in the appropriate U.S. district court under the Bankruptcy Act. This process contrasts with involuntary bankruptcy, where creditors petition the court to declare the debtor insolvent.
A voluntary conveyance refers to the sale or transfer of property done willingly by the owner, without any form of external compulsion or legal coercion. It stands in contrast to involuntary acts such as condemnation or eminent domain.
A group that provides for the payment of life, sickness, or accident benefits to individuals with an employment-related bond.
A voluntary lien is a legal claim against a property, typically agreed upon by the property owner, often involving mortgages or other secured loans.
Voluntary liquidation, also known as voluntary winding-up, is a process where a company's directors choose to dissolve the company, usually to terminate its operations and distribute its assets.
A voluntary plan, short for voluntary deductible employee contribution plan, is a type of pension plan where the employee elects to have contributions (which, depending on the plan, may be before or after-tax) deducted from each paycheck.
Registration for value-added tax (VAT) by a taxable person whose taxable turnover does not exceed the registration threshold. This option allows businesses to benefit from claiming input tax credits even if their revenue—taxable turnover—does not mandate compulsory VAT registration.
An organization of unpaid individuals who help others prepare their tax returns. Principally assisted are elderly, disabled, and non-English-speaking taxpayers.
Vonage is a public company that provides cloud communications services, including Voice over Internet Protocol (VoIP) services for businesses and individuals.
Voting right refers to the entitlement of a common shareholder to vote on the corporate affairs of a company either in person or by proxy.
Voting shares are shares in a company that give the shareholder the right to vote at the company's general and extraordinary meetings, typically associated with ordinary shares.
Voting stock refers to shares in a corporation that entitle the shareholder to participate in voting on matters such as electing the board of directors, mergers, acquisitions, and other significant corporate policies.
