A list of terms that can help you understand more about the accountancy world.
The body in the UK that sets accounting statements of practice.
The ratio of liquid assets to current liabilities.
The relationship between a principal and an agent, for example in a limited liability the company is the principal and the director is the agent.
Similar to depreciation, applied to fixed assets.
The rate that changes estimated future cash payments through the expected duration of the financial instrument.
Something that exists independently, for example a business exists independently of its owner.
Reports in the balance sheet of the group’s investment in the share capital of an associated company.
Users of financial statements that are not allowed access to financial documents on a day-to-day basis.
Information that is reported in terms of money.
When a company has long-term finance and they can’t commit to repayments on the loan due to interest rates or other financial factors.
The way in which financial statements are laid out in the order they appear.
Stocks of goods held for resale or manufacture.
An alternative phrase for gearing.
Loan finance traded on a stock exchange.
An agreement to keep some assets away from the entity’s balance sheet.
Operating profit as a percentage of sales.
An investor that is deciding whether to invest into a company.
The yield or reward on an investment.
The sales of a business or revenue from the operations of a business.
