GLOSSARY

This page contains the definitions to the terms, jargon, and acronyms that I have used in my blogs.

Term	Definition
Accounting Gimmicks	Loopholes in Generally Accepted Accounting Principles that alters the story that financial statements are telling to stakeholders
Annual Report	A report issued to a company's shareholders, creditors, and regulatory organizations following the end of its fiscal year. The report typically contains at least an income statement, balance sheet, statement of cash flows, and accompanying footnotes
Balance Sheet	Statement of the assets, liabilities, and capital of a business or other organization at a particular point in time, detailing the balance of income and expenditure over the preceding period
Book Value	The value of a security or asset as entered in a firm's books
Capital Expenditure (CAPEX)	Money spent by a business or organization on acquiring or maintaining fixed assets, such as land, buildings, and equipment
Cash Flow Statement	A financial statement that measures the cash generated or used by a company in a given period
Changes in Working Capital	The net change in current assets and current liabilities
Current Liabilities	Debts or obligations that are due within one year, appears on the company's balance sheet, and include short term debt, accounts payable, accrued liabilities and other debts
Depreciation and Amortization	Methods used to prorate the cost of a specific type of asset to the asset's life
Equity	The amount of the funds contributed by the owners (the stockholders) plus the retained earnings (or losses)
Foreign Exchange	Dealing in the currencies of other countries
Free Cash Flow	Measure of how much cash a business generates after accounting for capital expenditures such as buildings or equipment
Growth Rates (g)	The rate at which the company is expected to grow
Income statement	A financial statement that measures a company's financial performance over a specific accounting period
Industrial Imperative	The urge to follow what others in the industry are doing regardless whether it is a wise thing to do
Intrinsic Value	The underlying perception of an asset's true value
Margin of Safety	The gap between perceived value and reality acting as buffer against errors
Non-Current Liabilities	Long-term financial obligations that are not due within the present accounting year, including long-term borrowing, bonds payable and long-term lease obligations
Operating Cash Flows	Measure of the cash generated or used by a company in a given period solely related to core operations
Plough Back Ratio	Measures the amount of earnings retained after dividends have been paid out
Property, Plant and Equipment (PP&E)	All of a company's purchases of property, manufacturing plants and pieces of equipment to that point in time, less any amortization
Return on Equity (ROE)	The amount of net income returned as a percentage of shareholders equity. Measures a corporation's profitability by revealing how much profit a company generates with the money shareholders have invested
Revenue	The amount of money that is earned by a company through its business activities
Total Liabilities	The aggregate of all debts an individual or company is liable for, classified as current and non-current liabilities
Working Capital	The difference between a company's current assets and current liabilities for measuring a company's short term liquidity or its ability to cover short term liabilities