The world of finance is complex. A lot of words and numbers that don't really make sense until you understand the concept behind those words. This is why I made this Glossary. My name is Etienne Beaumont, I live in Laval and have been studying Social Sciences : Business profile for 2 years at Ahuntsic College. This glossary will be filled with words and definitions about the world of financing. I hope it will help people understand the ins-and-outs of finance.
account
noun
A record or statement of financial expenditure and receipts relating to a particular period or purpose.
Example: The current account was opened in August 1994, and the capital account is cautiously, though gradually, being liberalized.
fr: compte
asset
noun
Property owned by a person or company, regarded as having value and available to meet debts, commitments, or legacies.
Example: The first step for any corporation requiring security to protect their business is an assessment of the assets they wish to protect, and analysis of the value of those assets in order to determine the appropriate balance of cost and security depending on the cost to the business of a compromise to the security of a given asset. The following table lists the chief assets of Amazon's business with a brief evaluation of their value to the business.
fr: actif
capital
noun
Wealth in the form of money or other assets owned by a person or organization or available or contributed for a particular purpose such as starting a company or investing.
Example: This would require capital investment, but would give long term financial benefit (less remediation costs in the future).
fr: capital
credit
The ability of a customer to obtain goods or services before payment, based on the trust that payment will be made in the future.
Example: The first task for me when conducting a financial analysis is assess the farms goals in performance, solvency (whether or not a bank or supplier can safely grant credit) and potential value (whether an investment will be positive).
fr: crédit
debit
noun
An entry recording an amount owed, listed on the left-hand side or column of an account.
Example: As the projects started to emerge from the new road map, the researchers (and the top management) were not able to convince the donors to fund them, being more and more reliant on core funds, ultimately leaving a debit of one million US dollars in ISNAR's account.
fr: débit
debt
noun
The state of owing money.
Example: The issuer is responsible for the cardholder's debt payment.
fr: dette
equity
noun
The value of the shares issued by a company.
Example: It is usually considered that high amount of equity in comparison with high debt is better.
fr: Équité
exchange
noun
A building or institution used for the trading of a particular commodity or commodities.
Example: The New York Stock exchange.
fr: échange
finance
noun
The management of large amounts of money, especially by governments or large companies.
Example: Committees finance and General Purposes (F&GP): deals with the administration of the Institute, e.g. budget planning, preparation of annual reports and annual meetings, property maintenance.
fr: Finance
fund
noun
A sum of money saved or made available for a particular purpose.
Example: It is a healthy and growing company based on the high return in shareholder's fund of 120%.
fr: Fonds
interest
noun
Money paid regularly at a particular rate for the use of money lent, or for delaying the repayment of a debt.
Example: In PCD Maltron's case this is bad news; as the company is not very well established the security they can offer is quite low and so the interest charged on the loan would probably not justify taking the loan out.
fr: Intérêt
invest
verb
Expend money with the expectation of achieving a profit or material result by putting it into financial schemes, shares, or property, or by using it to develop a commercial venture.
Example: Business Angels tend to invest a smaller amount, typically only 24% of investments are greater than £100k, so this may or may not affect PCD Maltron.
fr: Investir
mortgage
noun
A legal agreement by which a bank or other creditor lends money at interest in exchange for taking title of the debtor's property, with the condition that the conveyance of title becomes void upon the payment of the debt.
Example: Inflation lowers owning costs because of the tax-deductibility of mortgage payments.
fr: Hypothèque
net
noun
A net amount of money is the total amount after taxes or costs have been removed.
Example: At the bottom there is the net income, this is the profit or loss for the given time.
fr: net
portfolio
noun
A range of investments held by a person or organization.
Example: Firstly, he states that with the acquisition of the new facilities Bodycote managed to "rebalance its portfolio" .
fr: Portefeuille
profit
noun
A financial gain, especially the difference between the amount earned and the amount spent in buying, operating, or producing something.
Example: Objective As a manager, I want to make my farm business as efficient as I possibly can in order to make a profit and create a sustainable future for myself and my staff.
fr: Profit
revenue
noun
Income, especially when of a company or organization and of a substantial nature.
Example: Automation increases production efficiency, uses less energy and often fewer operators, and generates an increased revenue and market share because of the resulting high quality of the finished product (Fellows, 2000).
fr: revenu
stock
noun
The capital raised by a business or corporation through the issue and subscription of shares.
Example: Finally, as Allisgood PLC is the smallest company by market capitalization (low number of shares or low share price) on London stock Exchange, it implies that raising a high amount of capital is difficult using this method.
fr: actions
term
noun
A fixed or limited period for which something, e.g., office, imprisonment, or investment, lasts or is intended to last.
Example: I financed my car for a 60-month term.
fr: Terme
wealth
noun
An abundance of valuable possessions or money.
Example: Such increase in consumer wealth helped offset the fall in share prices at the time allowing the American consumers to keep up their spending.