Technical terms
A method for creating a statement of cash flows a company may use during any given reporting period. The indirect method uses accrual accounting information...
The risk posed by an error or omission in a financial statement due to a factor other than a failure of control. In a financial audit, inherent risk is most...
A listing showing the closing balances of ledger accounts.
The state of being unable to pay the money owed, by a person or company, on time; those in a state of insolvency are said to be insolvent. There are two for...
The interest coverage ratio is used to determine how easily a company can pay their interest expenses on outstanding debt.
A process for assuring achievement of an organization's objectives in operational effectiveness and efficiency, reliable financial reporting, and compli...
The International Accounting Standards Board (IASB) issued its 'Framework for the Preparation and Presentation of Financial Statements' in 1989. Thi...
A classification used for business units within an enterprise. The essential element of an investment center is that it is treated as a used which is measur...
Investment income comes from interest payments, dividends, capital gains collected upon the sale of a security or other assets, and any other profit made th...
A product used by investors with the intention of gaining positive returns. Investment vehicles can be low risk, such as certificates of deposit (CDs) or bo...