Revalorization of currency involves replacing one currency unit with another to counteract the effects of frequent or significant currency devaluation, often associated with high inflation rates.
Revaluation involves increasing the value of an asset to reflect its current market value, where the asset cost account is debited and the revaluation reserve is credited.
In a partnership, the revaluation account captures changes in the value of assets and liabilities when a new partner is admitted, or an existing partner exits. It ensures that these adjustments are equitably shared according to the partnership agreement.
The revaluation clause, also referred to as a reappraisal lease, is a provision in a lease agreement that allows for periodic reassessment of the rental value of the leased property. This clause is often used to ensure that rental payments reflect the current market value of the property, protecting the interests of both the landlord and the tenant.
A method of determining the depreciation charge on a fixed asset against profits for an accounting period by revaluing the asset each year and writing off the fall in value.
A process usually undertaken by a government to increase the value of its currency in terms of gold or other currencies, typically to address a balance of payments surplus.
Revaluation of Fixed Assets refers to the process of re-assessing the value of a company's capital assets, either because they have increased in value or due to inflation rendering balance-sheet values unrealistic. This accounting practice is crucial for presenting accurate financial statements.
The revaluation reserve account is a reserve accounting entry where unrealized profits or losses from the revaluation of fixed assets are recorded. It's essential for financial accuracy and compliance in the revaluation method used.
Revenue is the total income generated by an entity from its main operating activities. It is a key indicator of financial performance and forms the base upon which profit and loss are calculated.
Revenue and Expense Accounts are fundamental components in accounting that track the income and expenditures of a business over a specific period. These accounts help determine the net profit or loss and are essential for financial reporting and analysis.
A Revenue Anticipation Note (RAN) is a short-term debt issue by a municipal entity, used to finance urgent needs and repaid with anticipated revenues such as sales taxes. Interest earned on RANs is generally tax-free for holders.
A type of municipal bond issued to finance revenue-generating projects and repaid with the revenues produced by those projects, such as toll bridges, highways, educational facilities, hospitals, sewer systems, stadiums, or other public facilities.
Revenue bonds are municipal bonds where the repayment of the principal and interest is secured by the revenue generated from the specific project they finance, such as toll bridges or utilities.
A revenue center is an area within an organization designated for generating income without being responsible for costs associated with production or service delivery.
Revenue evaporation is a significant drop in income from the sale of a product or service, often due to fundamental changes in the market, such as technological innovations.
Revenue expenditure refers to the costs that are immediately written off to the income statement in the accounting period in which they are incurred. These expenditures are associated with the revenue generated within the same period.
A revenue function is a mathematical representation illustrating how different items of income behave when plotted on a graph. The most common form is the total revenue function where total revenue is expressed as a function of the number of units sold multiplied by the selling price per unit.
Revenue management, also known as yield management, employs sophisticated algorithms and data analysis to forecast demand and adjust pricing dynamically, optimizing revenue for industries with fixed and perishable resources.
Changes in the tax laws designed to ensure that there is no net change in the total amount of revenue the government collects.
Revenue Procedures are published statements from the Internal Revenue Service (IRS) detailing instructions for the taxpayer and IRS officials in performing their duties.
A Revenue Procedure is an official published statement by the Internal Revenue Service (IRS) detailing procedural and administrative matters pertaining to the tax laws. Initial publications appear in the Internal Revenue Bulletin and are later transferred to the Cumulative Bulletin.
The process of recording revenue in the accounts of an organization in the appropriate accounting period is known as revenue recognition. This principle determines the specific conditions under which income becomes realized as revenue.
A revenue reserve is a distributable reserve, meaning it is part of a company's retained earnings that can be distributed to shareholders in the form of dividends or used to cover future uncertainties and contingencies.
An official interpretation by the IRS of the internal revenue laws, related statutes, tax treaties, and regulations, published in the Cumulative Bulletin. Revenue rulings are issued only by the National Office of the IRS and are published for the information and guidance of taxpayers, IRS officials, and others concerned.
A Revenue Ruling (REV. RUL.) is an official interpretation by the Internal Revenue Service (IRS) that provides guidance for taxpayers on how the IRS applies the law to specific factual situations. These rulings are intended to promote understanding and compliance with tax laws.
In the UK, the Revenue Support Grant (RSG) is central government funding provided to local authorities to supplement income from local taxes, enabling them to maintain services and taxes at levels comparable to other authorities. It was formerly known as the Rate Support Grant.
The Revenue Support Grant (RSG) is a financial allocation provided by central government to local authorities to aid in funding public services and infrastructure projects.
A transaction that is generally of a short-term nature and is only expected to benefit the current period. Revenue transactions appear in the profit and loss account of the period.
Reversal, a multifaceted term, can signify a change in direction of financial markets, an offsetting accounting entry, a negative business event, or the overturning of a court decision.
A Reverse Annuity Mortgage (RAM) is a financial instrument that allows elderly homeowners to convert home equity into a steady stream of income or a lump sum, while continuing to live in their home. This facility is especially useful for retirees needing to access additional funds without selling their property.
Reverse channels in marketing refer to a channel of distribution where products are moved from the consumer back to the producer. This often includes activities like recycling and product recalls.
Reverse discrimination is a condition occurring when an employer illegally favors the hiring and promotion of protected groups of minorities and women while excluding other candidates from consideration.
Reverse engineering is the process whereby a competitor's product is completely dismantled to learn everything about it, usually for the purpose of replication.
Products made by a multinational corporation's overseas units for export to the home country.
Reverse leverage, also known as negative leverage, occurs when the financial benefits from ownership accrue at a lower rate than the interest rate paid for borrowed money.
A reverse premium, also known as a lease incentive, is a cash payment made by the lessor to the lessee to encourage the latter to enter into a lease agreement.
A reverse split is a corporate action in which a company reduces the number of its outstanding shares while keeping the market value the same immediately after the reverse split as it was before. Each share will be worth more post-reverse split.
A Reverse Takeover (RTO) involves a private company purchasing control of a publicly-traded company, often as a cost-effective means to obtain a stock exchange listing.
An indication that a decision of one court has been overturned by a higher court.
A reversing entry is a journal entry made to nullify a previous journal entry, thereby preventing errors caused by the previous entry.
Reversion in real estate law refers to the future interest that the grantor retains when they transfer property rights to another party but stipulate that the property will return to them upon the occurrence of a specific event or the expiration of a certain term.
A sum added to the amount payable on death or maturity of a with-profits policy for life assurance, based on surplus or profit on the investment of life funds.
The Reversionary Factor is a mathematical factor that indicates the present worth of one dollar to be received in the future. It is equivalent to the Present Value of 1.
Reversionary interest refers to the interest a person holds in a property upon the termination of the preceding estate. This future interest in the property typically arises when the preceding estate, such as a life estate, comes to an end.
Reversionary value refers to the estimated value of a property at the end of a predefined period of time, typically used in real estate and financial projections.
A review in accounting service provides limited assurance to the Board of Directors and other interested parties about the reliability of financial data. It does not involve an audit conducted according to generally accepted auditing standards but focuses on inquiry and analytical procedures.
In standard costing, a revision variance, also known as a planning variance, measures the expected difference arising from the original standard and the modified standard due to changed circumstances. These variances help in understanding how accurately performance predictions align with actual outcomes.
A revocable beneficiary is a designated individual or entity that can receive benefits from a life insurance policy, trust, or other financial product, and whose designation can be changed or revoked by the policyholder or grantor at any time.
Revocable transfers are property transfers that can be rescinded or revoked by the transferor, resulting in the property being included in the transferor's gross estate upon death.
A revocable trust is an estate planning tool that allows the grantor to alter or cancel the trust agreement during their lifetime, providing flexibility compared to an irrevocable trust.
Revocation refers to the withdrawal or cancellation of an authority, offer, or instrument that was previously effective. It impacts the offeree's power of acceptance and has legal implications in various contexts, such as contracts, wills, and licenses.
A comprehensive look at the term 'revolution,' encompassing its definitions ranging from total and complete change in contextual applications to the movement on an axis such as revolutions per minute (rpm). Relevant across various disciplines like technology, mechanics, social change, and more.
RAFT, or Revolving Acceptance Facility by Tender, is a financial arrangement commonly used to manage and facilitate short-term financing needs of corporations. This instrument is widely adopted in the banking and corporate finance world due to its flexibility and efficiency.
Revolving Acceptance Facility by Tender (RAFT) is an underwritten facility provided by a bank to place sterling acceptance credits through a tender panel of eligible banks.
A revolving bank facility, also known as standby revolving credit, is a flexible loan agreement between a bank or a group of banks and a company, which allows the company to draw and repay funds multiple times during the loan's term.
A Revolving Charge Account is a type of credit account that allows for continuous borrowing as long as the account stays within the credit limit and minimum payments are made. It is commonly used in credit cards and lines of credit.
Revolving credit is a financial arrangement where a lender provides funds up to a pre-approved credit limit, which the borrower can repeatedly use, repay, and use again. Common in both commercial and consumer banking, revolving credit helps businesses manage working capital and allows consumers flexible access to funds.
Revolving credit is a type of credit that does not have a fixed number of payments, allowing the borrower to reborrow money as they repay the principal.
A revolving fund is an account or sum of money designed to be replenished to its original balance after use, enabling it to be spent or loaned repeatedly for ongoing financial activities.
A revolving line of credit is a flexible borrowing option that allows individuals or businesses to access and repay funds on an as-needed basis up to a specified credit limit.
Rezoning is the process of changing the land use designation of a specified parcel or group of parcels on the zoning map, thereby altering the permitted uses for the affected parcels.
RGB is a color model used to produce color images on electronic displays by combining red, green, and blue light in various intensities.
The term 'RICH' has various meanings in finance and everyday language, from denoting high-valued securities or interest rates to simply describing wealth.
Rich Text Format (RTF) is a universal computer format for text documents that allows the inclusion of various formatting attributes, using different fonts and typefaces to enhance document presentation.
Rich Text Format (RTF) is a proprietary document file format with published specification developed by Microsoft Corporation. Making it easier to exchange text files between different word processors and operating systems, RTF can store information about text formatting, document structure and even embed additional content such as images.
An endorsement to an insurance policy that modifies clauses and provisions of the policy, adding or excluding coverage.
In legal and ethical contexts, a right refers to a justified claim or entitlement that individuals or groups possess. These rights can be grounded in moral obligations or codified within legal systems, such as Subscription Rights in securities.
A contractual opportunity granted to a specific party to match the terms of a proposed contract before it is executed with another party.
The Right of First Refusal (ROFR) is a contractual right that gives its holder the option to enter into a business transaction with the owner of an asset before the owner is entitled to enter into that transaction with a third party.
The right of redemption allows a property owner to recover their property that has been transferred due to a mortgage or other lien by repaying the debt, typically before or shortly after foreclosure. This right is also known as the equity of redemption.
A right granted by the federal Consumer Credit Protection Act of 1968 allowing consumers to void a credit contract within three business days with full refund of any downpayment and without penalty.
The right of return refers to an agreement that allows the purchaser to return goods to the seller for a full credit or refund. This policy is often included in sales contracts and consumer agreements to enhance customer satisfaction and trust.
The right of survivorship is a legal concept in property ownership that permits the surviving co-owner(s) to automatically inherit the property upon the death of a fellow co-owner. This principle is particularly applicable to joint tenancy and tenancy by the entirety.
Right-Click refers to the action of pressing the right or secondary button on a computer mouse or touchpad. This action typically opens context-specific menus that provide additional options related to the element under the cursor.
The right to use a particular path for access or passage, often considered a type of easement beneficial for infrastructure development, transportation, and property access.
Right-to-Work Laws are statutes that prohibit agreements between labor unions and employers that make union membership, dues, or fees a condition of employment, as permitted by Section 14(b) of the Taft-Hartley Act.
A method by which listed companies on a stock exchange raise new capital by offering new shares to existing shareholders. This concept is based on pre-emption rights, ensuring existing shareholders can purchase new shares proportionally to their existing holdings.
Rightsizing is the restructuring and rationalization of an organization to improve effectiveness and cut costs without involving a comprehensive downsizing. It can also mean adjusting the size of an organization to align with current business demands, though it's typically associated with moderate and controlled downsizing.
A rigid price (also referred to as an administered price) is a pricing strategy wherein the price of a product or service remains unchanged despite ongoing shifts in market demand and supply conditions.
The concept of ring-fencing is used in finance and corporate restructuring to isolate a certain portion of assets, liabilities, or operations to protect the rest of the company or to dedicate specific funds for particular purposes.
Riparian rights refer to the entitlements vested in landowners whose property abuts bodies of water, such as rivers and lakes.
Measurable possibility of losing or not gaining value. Risk is differentiated from uncertainty, which is not measurable. Various types of risk include actuarial risk, exchange risk, inflation risk, interest rate risk, inventory risk, liquidity risk, political risk, repayment (credit) risk, risk of principal, systemic risk, underwriting risk, and unsystemic risk.
The measurement and analysis of the risk associated with business, financial, and investment decisions. It involves the identification of risk, the classification of risks in regard to their impact and likelihood, and a consideration of how they might best be managed.
Risk Arbitrage, also known as takeover arbitrage, is a strategy involving the simultaneous purchase of stock in a company being acquired and the sale of stock in its proposed acquirer.
Understanding risk-averse investors who prioritize security over potential higher returns.
Risk avoidance involves management methods utilized to bypass as much situational risk as possible. While the elimination of all risk is rarely feasible, in many situations it is prudent to develop strategies where specific risks can be circumvented.
Risk capital refers to the funds invested in projects with a high level of uncertainty, such as new ventures or expanding businesses, where substantial risk exists but the potential for high returns is present.
Risk financing transfer involves paying an insurance premium to an insurance firm to cover certain risk hazards, thereby transferring the financial consequences of those risks.
Risk management is a process that aims to help organizations understand, evaluate, and take action on all their risks to maximize their value. This can include taking out insurance or hedging through derivatives.
The risk premium represents the difference between the expected rate of return on an investment and the risk-free rate of return (such as those on government bonds) over the same period. It accounts for the compensation investors require to bear the additional risk associated with investment.
Risk retention is a method of self-insurance where an organization retains a reserve fund to offset unexpected financial claims. It involves setting aside funds to handle potential future losses and can be an effective risk management strategy under certain conditions.
Risk vs. Reward is a financial concept that attempts to compare the potential fluctuations, especially the downside, with potential benefits to determine whether the proposed investment or cost is worthwhile.
In capital budgeting and portfolio management, the risk-adjusted discount rate is the discount rate used in calculations of present value to reflect the level of risk embodied in the cash flows being considered.
RAROC is a performance measurement tool used by financial institutions to determine the risk-adjusted profitability of various units within the organization.
An auditing technique focused on identifying and assessing the levels of risk in different areas of an organization's systems to concentrate efforts on the areas of highest risk, thereby improving the detection of errors or fraud.
Methods used to reduce the amount of inherent risk. The four basic risk control techniques are Risk Avoidance, Risk-Control Transfer, Loss Prevention, and Loss Reduction.
Risk-financing techniques involve strategies used to reduce financial risk through methods such as risk retention or risk-financing transfer.
The risk-free rate or risk-free return represents the interest rate on the safest investments, such as federal government obligations. It is a fundamental component in financial models, particularly in assessing the required return on investments.
The rate of return on an investment that has no risk. The return on US and UK Treasury bills is often regarded as a very close approximation to this rate. The risk-free rate is an important concept in the Capital Asset Pricing Model (CAPM).
An essential concept in investment management suggesting that the potential return on any investment rises with an increase in risk. In practice, higher-risk investments generally offer greater potential returns, and vice versa.
