Numbers dressed up in fancy suits pretending to be words.
The correction of previously issued financial statements due to errors, fraud, or accounting policy changes—corporate speak for 'we messed up, never mind what we told you before.' It's never a good sign when a company announces one.
A report categorizing accounts receivable by how long they've been outstanding, typically in 30-day buckets. It's a snapshot of who owes you money and which customers are slow payers or potential deadbeats.
The complete month-end or year-end financial closing process with all adjustments, reconciliations, and financial statements finalized—as opposed to a soft close that's faster but less comprehensive. It's the accounting equivalent of spring cleaning versus just shoving everything in the closet.
The practice of selling investments at a loss to offset capital gains and reduce tax liability, then often buying similar assets to maintain market exposure. It's using the tax code's lemons to make lemonade.
The difference between the present value of cash inflows and outflows over time, discounted because a dollar today is worth more than a dollar tomorrow—thank you, inflation and opportunity cost. If it's positive, invest; if negative, run away.
A hierarchy determining who gets paid first when money comes in, ensuring investors and executives eat before employees see a dime. It's trickle-down economics but explicitly documented.
How much profit a company generates per dollar of shareholder investment, or as executives call it, the only number that matters. Because shareholders' yachts don't buy themselves.
A metric measuring a company's ability to meet short-term obligations with liquid assets, like the current ratio or quick ratio. Think of it as the financial equivalent of asking whether you can make rent next month without selling your car.
In accounting, the money your company owes but hasn't paid yet—basically corporate IOUs sitting on the balance sheet like financial landmines. Also known as "accounts payable," these are the bills that make CFOs wake up in cold sweats. The bigger this number gets, the more creative the excuses to vendors become.
A journal entry made at the corporate level above the normal operational accounting system, often used for adjustments or consolidation. It's headquarters overriding local books, sometimes legitimately, sometimes suspiciously.
A loan covenant preventing borrowers from pledging assets as collateral to other lenders, protecting unsecured creditors from being subordinated. It's lenders making sure you can't promise the same car to multiple people.
A potential obligation that may or may not materialize depending on future events, like pending lawsuits or product warranty claims. It's Schrödinger's debt—simultaneously owing money and not owing money.
The master accounting record containing all financial transactions, organized by account. It's the single source of truth for a company's finances, assuming someone entered everything correctly.
A lease treated as a rental agreement rather than an asset purchase, historically kept off the balance sheet in a beautiful accounting loophole. Airlines loved these for planes; retail loved them for stores.
The process of distributing indirect costs across products or departments, often using arbitrary methods that accountants swear are reasonable. It's making sure everyone shares blame for the heating bill and executive salaries.
A contra-asset account estimating receivables that customers will never pay, because optimism doesn't belong on a balance sheet. It's acknowledging reality before reality forces you to.
Breaking down financial results by business unit, geography, or product line to show which parts of the company are actually making money. It's where corporate winners and losers get exposed despite management's attempts at averaging.
The accounting method where you recognize revenue when earned and expenses when incurred, regardless of when cash actually changes hands. It's like claiming you're rich because people owe you money, even if you're currently broke.
A fancy legal term for embezzlement that makes stealing company funds sound almost scholarly. It's the misappropriation of money held in trust or fiduciary capacity, often discovered when the auditors start asking uncomfortable questions.
A bond provision allowing holders to demand early repayment at par if certain events occur, like a change of control or credit downgrade. The bondholder's nuclear option when they don't like new management's plans.
A stock that appears cheap based on traditional metrics but deserves the low valuation because the business is deteriorating. Looks like a bargain, performs like a money incinerator.
A financial wizard who makes money by exploiting price differences across markets, basically the sophisticated cousin of the person who buys concert tickets cheap and sells them expensive. They're the reason your economics professor kept going on about market efficiency being impossible. Investment banks love them; everyone else thinks they're basically legalized scalpers in suits.
The minimum cushion of high-quality capital that banks must maintain relative to their risk-weighted assets, determined by regulators who learned that 'trust us' isn't adequate oversight. Your taxpayer-funded insurance against banker recklessness.
The prices charged between subsidiaries of the same multinational corporation for goods or services, theoretically based on arm's-length principles but conveniently used to shift profits to low-tax jurisdictions. Tax authorities are not amused.