Enterprise Resource Planning (ERP) is a comprehensive software system that integrates various business processes and functions, including inventory, accounting, human resources, and more, into a unified platform for streamlined operations and data management.
Exposure in foreign exchange refers to the potential risk or sensitivity of a company's financial situation to fluctuations in currency exchange rates.
Financial close is the process of finalizing and completing all financial transactions, adjustments, and reporting at the end of an accounting period to accurately reflect a company's financial standing.
A financial plan is a comprehensive outline detailing an individual's or organization's objectives, strategies, and anticipated actions to manage and optimize their finances effectively.
Financial reporting involves the disclosure of a company's financial performance and position through documents and statements, allowing stakeholders to assess its economic activities and status.
A fiscal year is a 12-month period that organizations or governments use for accounting and budgeting purposes to track financial performance and report income and expenses.
Fixed assets, also known as tangible assets, are long-term physical properties or investments with enduring value used in a company's operations, such as buildings, equipment, and land.
A forward contract is a customized financial agreement between two parties to buy or sell an asset at a predetermined future date and price, providing a hedge against price fluctuations.
The general ledger is a comprehensive record that presents all financial transactions of a company and organizes them into individual accounts for tracking purposes.
Governance refers to the practices and processes used to ensure the effective management and oversight of an organization, typically involving decision-making, compliance, and maintaining accountability.
In options markets, "the Greeks" serve as numerical metrics traders utilize to gauge the risks associated with a specific trade type. These consist of five primary Greeks, each reflecting a distinct variable: Delta, Gamma, Vega, Theta, Rho
Gross profit is the difference between a company's total revenue and the cost of goods sold (COGS), representing the profit generated before deducting operating expenses.
Gross profit margin is a financial metric that represents the percentage of revenue retained after deducting the cost of goods sold, demonstrating a company's efficiency in producing goods or delivering services.
Gross sales represent the total revenue generated by a company from the sale of its products or services before accounting for any deductions or expenses.
Hedging is a financial strategy used to reduce or offset the risk of adverse price movements in assets by taking an offsetting position in a related security or derivative.
Human Capital Management (HCM) encompasses the strategic approach to managing and optimizing a company's workforce, focusing on recruiting, developing, and retaining employees to enhance overall business performance.
The income statement is a financial report that details a company's revenues, expenses, and profits over a specific period, summarizing its financial performance.
The initial margin represents the percentage of the investment or collateral required by a broker or exchange for an investor to engage in a futures contract or securities purchase.
Intangible assets are non-physical assets representing valuable rights and resources such as patents, trademarks, copyrights, goodwill, and intellectual property.
The Interest Coverage Ratio is a financial metric that assesses a company's ability to pay its interest expenses on outstanding debt by comparing its earnings before interest and taxes (EBIT) to its interest expenses.
The Internal Rate of Return (IRR) is a metric used to evaluate the profitability of an investment by calculating the discount rate that makes the net present value of future cash flows equal to zero.
Inventory turnover, in a single sentence, represents the number of times a company sells and replaces its average inventory in a given period, showing how effectively inventory is managed.
The Japanese Yen Carry Trade refers to a financial strategy involving borrowing low-interest Japanese yen to invest in higher-yielding assets in other currencies to capitalize on interest rate differentials.
Jensen's Alpha stands out as a crucial metric used to assess the risk-adjusted returns of an investment portfolio. Named after Michael Jensen, this performance measure evaluates an investment's excess return compared to its expected return based on the Capital Asset Pricing Model (CAPM).
A knock-in option is a type of derivative that becomes active or "knocks in" only if the underlying asset reaches a specific price level during its lifetime.
A lagging indicator is a financial or economic metric that trails behind changes in the overall economy, reflecting historical data and confirming trends after they have occurred.
A leading indicator is a statistical measurement or metric that forecasts and predicts potential future changes in economic trends or financial markets.
Leasehold Improvements (LHI) are enhancements or modifications made to a leased property by the tenant, typically to customize the space to their specific needs, with the costs often amortized over the lease term.
Leverage, in finance, involves using borrowed funds or debt to amplify the potential returns or risks of an investment, allowing an investor to control a larger position than with their own capital.
Long-term assets are tangible or intangible resources that a company holds for an extended period, typically more than a year, to support its operations and generate future revenue.
