Business or Professional Activity Code refers to six-digit code numbers used to classify enterprises by the type of activity for the administrative purposes of the Internal Revenue Service (IRS). These codes are analogous to the North American Industry Classification System (NAICS).
A business organization refers to the legal structure of a particular business in terms of how it functions. Its purpose is central to its structure.
Business Performance Management (BPM) is a framework of metrics that enables companies to analyze and ensure they meet their key performance indicators. This guide explains BPM, its applications, and related concepts.
A business plan is a comprehensive guide that outlines a company's goals, strategies, and financial projections, essential for both new ventures and established businesses seeking capital or strategic direction.
Business process re-engineering (BPR) is a strategic approach to improving organizational efficiency by fundamentally rethinking and redesigning business processes.
Business Process Re-engineering (BPR) aims to lower costs and improve quality through a radical reassessment of an organization's working methods, leveraging enhanced information technology for fundamental redesign.
Business property refers to any property used in a trade or business that is not classified as a capital asset. This could include inventory, property held for sale, trade receivables, depreciable property, real property, and intangible assets like copyrights or trademarks.
A comprehensive insurance package that provides protection for a business's property against damage or destruction caused by perils such as fire, smoke, and vandalism, as well as liability coverage if the actions (or non-actions) of the business's representatives result in bodily injury or property damage.
Business Property Relief (BPR) is a form of inheritance tax relief available on certain types of business property, designed to protect family businesses from the burden of inheritance tax upon the death of an owner.
A principle applied to various transactions to ensure that the transaction serves a legitimate business purpose, other than solely for tax benefits, in order to be considered valid for tax purposes.
The local tax paid in the UK by businesses, based on a local valuation of the property occupied by the business and the Uniform Business Rate (UBR) set by central government.
A Business Reply Card (BRC) or envelope is a pre-addressed reply mechanism, typically used for promotion, that allows respondents to reply without needing to pay postage. The initiating mailers cover the postage costs via an annual business reply permit fee.
A service allowing businesses to distribute preaddressed cards, envelopes, labels, or cartons that can be mailed back without prepayment of postage, with charges incurred upon delivery.
Separately identifiable parts of the business operations of a company or group whose activities, assets, risks, and returns can be clearly identified. Companies are obliged to disclose in their annual report and accounts certain financial information relating to these business segments.
Business software packages (commonly referred to as office suites) encompass a broad range of software programs sold to facilitate various business activities, from bookkeeping to document processing.
A business trust is an unincorporated business organization created by a trust instrument. It is an alternative to a corporation or partnership structures, allowing the trustee to manage the trust's assets for beneficiaries.
Business value encompasses the total worth of a business, considering both tangible and intangible assets. It represents the value above the mere physical assets, including elements such as goodwill and going-concern value.
A form of advertising intended to communicate among businesses as opposed to consumer advertising. B2B advertising is directed at business people or companies that purchase or specify products for business use.
A Businessowners Policy (BOP) is a package policy commonly tailored for small and medium-sized businesses. It combines property and business interruption insurance to cover a range of expenses resulting from damage, destruction or liability issues related to business operations.
An insurance policy that combines various risk coverages into one package designed for small to medium-sized businesses.
In corporate acquisitions, a bust-up acquisition is a strategy where a raider sells some of the acquired company's assets to finance the leveraged acquisition.
A defined area of the screen, usually designed to look like a pushbutton, which, when clicked with a mouse, performs a given action often represented by an icon on the button face.
To acquire property, goods, or services in return for money or its equivalent. It can also be used synonymously with bargain.
A buy down involves paying extra upfront to a lender in exchange for a lower interest rate on a mortgage loan. This lower rate can apply to either the entire loan term or part of it.
In securities trading, a buy order is an instruction to a broker to purchase a specified quantity of a security at the market price or another stipulated price.
A buy-and-sell agreement is a strategic approach utilized in sole proprietorships, partnerships, and close corporations to safeguard the continuity of the business upon the death or disability of a proprietor, partner, or shareholder. Such agreements involve selling the business interests to remaining members according to a predetermined formula.
A buy-back agreement is a contractual provision where the seller agrees to repurchase the property at a stated price upon the occurrence of a specified event within a certain period of time.
A Buy-In is a procedure used in options trading and securities transactions to manage the responsibility for the delivery or acceptance of stock when the original agreement is not met.
The purchase of a holding of more than 50% in a company by (or on behalf of) a group of executives from outside the company who wish to run the company.
A Buy-In Management Buy-Out (BIMBO) is a strategic acquisition where existing management, along with external investors, purchase a company, offering a blend of insider expertise and additional capital with more managerial control.
A buy-out, also known as a buyout, refers to the purchase of a substantial holding in a company, often by its existing managers or employees. This enables the acquiring party to gain greater control or full ownership of the company.
A buy-sell agreement is a legally binding pact among partners or stockholders that outlines the process for one party to buy the interests of another if certain events occur, such as the death of a partner.
A buyer is an individual or entity that purchases goods or services. Buyers can be categorized into various types based on their role and the nature of their purchasing activity.
Buyer behavior is a field of study crucial for understanding how buyers make their purchase decisions, influenced by personality, sociodemographic characteristics, and lifestyle. It plays an essential role in modern marketing strategies.
A buyer's broker in real estate brokerage represents the buyer's interests explicitly, locating appropriate properties, assisting in making offers, and negotiating contracts. The buyer may or may not pay a fee for these services.
A buyer's market is an economic situation where the supply of goods or assets exceeds demand, giving buyers an upper hand in negotiations over sellers. This term is widely used in the real estate sector to describe conditions where property buyers have an abundance of choices and leverage to negotiate lower prices.
Buyer's remorse refers to the regret or anxiety that a person may feel after making a significant purchase, often due to cognitive dissonance. This phenomenon is common in both consumer and business purchases.
Buying on margin involves purchasing securities using credit from a broker, facilitated through a margin account, and is strictly regulated by the Federal Reserve Board (FRB).
A buyout involves purchasing at least a controlling percentage of a company's stock to take over its assets and operations. It can be accomplished through negotiation or a tender offer.
Buzz words are slang terms or phrases often used by specific groups to convey ideas in an impressive but sometimes imprecise manner. They can become part of standard English if their usage becomes widespread.
The term 'By the Book' refers to acting in a very rigid manner, according to pre-established written guidelines and regulations. It often represents a criticism implying a lack of flexibility and responsiveness within an organization.
A by-product is a secondary product derived from a manufacturing process or chemical reaction, often with some economic value.
Bylaws are rules adopted for the regulation of an association's or a corporation's own actions. In corporation law, bylaws are self-imposed rules that constitute an agreement or contract between a corporation and its members to conduct the corporate business in a particular way.
A bypass trust, also known as a credit shelter trust or an exemption trust, is an irrevocable trust that allows parents to pass assets to their children while reducing or eliminating estate taxes.
A byte is the amount of computer memory space needed to store one character, which is typically 8 bits. A computer with 8-bit bytes can distinguish 2^8 = 256 different characters. The size of a computer's memory is measured in kilobytes, where 1 kilobyte (KB) = 1024 bytes.
A C Corporation is a type of corporation that is taxed separately from its owners under Subchapter C of the Internal Revenue Code. This structure allows the corporation to retain earnings and provides liability protection for its shareholders.
A C-type reorganization, also known as a stock-for-assets reorganization, is a type of corporate restructuring defined under the Internal Revenue Code (IRC) section 368(a)(1)(C). This specific type of merger involves the acquisition by one corporation of substantially all of the properties of another corporation solely in exchange for all or a part of its voting stock.
C.C.C. stands for 'Cwmni Cyfyngedig Cyhoeddus,' which is the Welsh equivalent of a Public Limited Company (plc) in English. It refers to a type of company in Wales that is permitted to offer its shares to the public.
A code of best practice, established by Thomas Dunfee and David Hess of the University of Pennsylvania, that outlines how a company and its employees should deal with any attempt to make or solicit improper payments. This code emphasizes ethical behavior in business practices to prevent bribery and corruption.
Computer-Assisted Audit Techniques (CAATs) are techniques that utilize computer systems to execute auditing processes, which streamline the traditional audit workflow, enhance accuracy, and improve overall audit efficiency.
A modern method of transferring funds or other assets internationally in an expeditious manner. Typically involving electronic communication channels rather than physical wires.
A cablegram is a telegram sent overseas by means of a submerged wire.
The CAC 40 (Cotation Assistée en Continu) is a capitalization-weighted price index of the 40 most actively traded shares on the Paris Bourse (now Euronext Paris).
A cache is a storage location that holds frequently accessed data to speed up future retrievals. It is commonly used in computing to improve performance by reducing the time to access data.
Cachet refers to a mark of quality or distinction, individuality, or authenticity typically associated with superior status or elite standing. A product or brand with cachet often enjoys a higher value and esteem among consumers and peers.
A cadastre is a comprehensive register of the real property in a jurisdiction, which includes detailed information about property boundaries, land ownership, and the value of the land and its improvements. It is commonly used to determine the amount of tax assessed on each parcel of land.
The Cadbury Report, issued in 1992, laid the foundation for the principles of corporate governance in the UK, emphasizing the importance of non-executive directors, formal appointing processes, and accountability.
An arrangement that allows employees to choose their own employee benefit structure, tailoring it according to their personal needs and preferences.
A cafeteria plan allows employees to choose from a variety of fringe benefits, including cash, without including the chosen benefit in their gross income for tax purposes.
A Comprehensive Annual Financial Report (CAFR) is a detailed presentation of a state, municipality, or other governmental entity's financial condition. It can serve various stakeholders, including citizens, governing bodies, investors, and creditors.
A calendar year refers to a continuous period beginning on January 1 and ending on December 31, widely used for financial and accounting purposes. In contrast, a fiscal year can vary depending on the organization's specific reporting requirements.
A call is a financial term used in various contexts, including banking, bonds, and options, signifying the right or action to demand repayment, redeem or buy securities under specific conditions.
A call center is a facility equipped to handle a large volume of telephone calls, mainly for taking orders, serving customers, or for selling products through telemarketing. Call centers can be primarily inbound or outbound, depending on their function.
A call feature or call provision is part of the agreement a bond issuer makes with a buyer, detailing the schedule and price of redemptions before maturity. Most corporate and municipal bonds have ten-year call features, while government securities usually do not.
Call forwarding is a telecommunication service provided by phone companies, allowing incoming calls to be automatically redirected to another designated phone number.
A call option is a financial contract that gives the holder the right, but not the obligation, to buy a specified amount of an underlying asset at a predetermined price within a fixed timeframe.
In financial terms, a call premium is either the amount paid by the buyer of a call option above the stock's or index’s current market price, or the additional amount over par that an issuer of bonds or preferred stock pays to redeem the security early.
The call price is the price at which a bond or a preferred stock with a call feature can be redeemed by the issuer prior to its maturity date. It is also known as the redemption price.
A call report is a detailed documentation maintained by an advertising agency, capturing the specifics of conferences between agency representatives and current or prospective advertiser clients. It is alternatively known as a conference report or contact report. This document includes information such as the date of the meeting, participants, and discussion points.
Call Waiting is a telecommunications service offered by local telephone companies that allows users to receive a tone indicating another incoming call while they are currently on the line, enabling them to answer the new call and place the first caller on hold.
A callable security can be redeemed by the issuer before its scheduled maturity date, usually triggering a necessity for extra payment to the holder, identified as a call premium.
Fixed-rate bonds wherein the issuer holds the right, but not the obligation, to redeem the bond at par value or at a premium during its lifetime. Callable bonds often include a grace period where the issuer cannot call the bond, with conversion possible later if specific conditions are met.
Called-up share capital refers to the part of issued share capital that has been requested to be paid by the shareholders. This term is relevant when dealing with partly paid shares.
Camera-Ready Copy (CRC) refers to artwork or a printout that is ready to be photographed and transformed into a printing plate for offset reproduction. This stage signifies the final step before actual printing, ensuring all elements are properly positioned and formatted.
The Canadian Institute of Chartered Accountants (CICA) is the professional body of practising accountants in Canada, originally founded in 1902 as the Dominion Association of Chartered Accountants. It plays a crucial role in setting accounting standards and providing professional development for its members.
In financial and legal contexts, 'cancel' refers to the act of voiding a negotiable instrument by annulling or settling it, prematurely terminating a bond or other contract, or voiding an order to buy or sell securities.
A cancellation clause is a contract provision that grants the right to terminate obligations upon the occurrence of specified conditions or events. For example, a cancellation clause in a lease might permit the landlord to break the lease upon the sale of a building.
A company-prepared selling presentation where sales representatives memorize and repeat it verbatim when making a sales presentation. This technique is often used for inexperienced sales personnel but can appear too artificial for complex selling transactions.
A canned program is a prewritten computer program available for purchase, often designed to perform a range of common tasks for users with minimal customization.
A ceiling on a charge; for example, an interest-rate cap would set a maximum interest rate to be charged on a loan, regardless of prevailing general interest-rate levels.
Cap and Trade is an environmental policy approach aimed at reducing pollutants by setting a limit on emissions and allowing companies to trade emissions permits.
The Cap Rate, or Capitalization Rate, is a fundamental metric used in real estate to determine the rate of return on an investment property based on the income it is expected to generate.
The Confederation of Asian and Pacific Accountants (CAPA) is an organization that represents professional accountancy bodies in the Asia-Pacific region, facilitating cooperation and advancing accounting standards.
Understanding an organization’s maximum achievable output given the available resources such as labor and machinery, under specific conditions.
Capacity planning is a long-term strategic process that determines the production capacity needed by an organization to meet changing demands for its products.
Capacity Usage Variance (CUV) measures the difference between the actual hours worked and the budgeted hours, specifically in relation to fixed overheads. It is an essential metric in manufacturing and production, providing insights into operational efficiency and resource utilization.
The landmark case of *Caparo Industries plc v Dickman and others* (1990) significantly influenced the realm of audit law by ruling that auditors owe a duty of care to existing shareholders as a collective entity rather than to individual shareholders.
In finance and accounting, 'capital' refers to various forms of assets, interests, or financial contributions that play a critical role in the functioning of an entity or the production process, enhancing productivity and enabling operations.
A comprehensive financial account in various types of business, recording different aspects of share capital, investments, and capital expenditures.
A critical metric used to evaluate a bank's ability to meet its liabilities, ensuring it maintains a sufficient buffer to absorb potential losses and protect the interests of depositors and creditors.
Capital allocation refers to the deployment of funds across various units or projects within an organization based on calculated potential returns and risks, often employing techniques like value-at-risk (VaR) and contributing to metrics such as shareholder value and Economic Value Added (EVA).
Capital allowances refer to allowances against UK income tax or corporation tax available to businesses, sole traders, partnerships, or limited companies that have capital expenditures on plant and machinery used in the business.
A capital asset is property of any type held by an individual or business, excluding inventory and certain other types of property. Capital assets can include buildings, land, equipment, vehicles, stocks, and bonds.
The Capital Asset Pricing Model (CAPM) is a sophisticated model that establishes a relationship between expected risk and expected return. It operates on the principle that investors require higher returns as compensation for higher risks.
The CAPM is a formula used to determine the expected return on an investment by accounting for both the risk-free rate of return and the risk premium.
The Capital Asset Pricing Model (CAPM) is a cornerstone of modern financial theory, providing a framework used to determine the expected return on an investment for a given level of risk.
Capital assets are forms of property with a relatively long life, often used in trade or business, that receive specific tax treatments when sold, resulting in either capital gain or capital loss.
A measure of possible worst-case losses in excess of the average used in banking to calculate both capital adequacy requirements and certain performance measures, such as risk-adjusted return on capital (RAROC). It is usually based on the value-at-risk (VaR) methodology.
The Capital Budget, also known as the capital expenditure budget or capital investment budget, is part of the master budget that outlines the anticipated capital expenditures an organization plans to make within a given budget period.
Capital budgeting, also known as capital investment appraisal or investment appraisal, is the process by which an organization evaluates different investment projects to determine which is likely to provide the highest financial return.
