FINANCIAL TERMS AND CONCEPTS - 02

FINANCIAL TERMS AND CONCEPTS - 02

26. Articles of association: A company’s document that sets out the shareholders’ rights and the directors’ powers.

27. Asset: Something owned.

28. Asset management:  A service from a financial adviser to spread a person’s investment between a number of assets, such as shares, Government bonds, cash and property, so that they can potentially earn more money.

29. Asset management:  Insurance cover for an event that will definitely happen, such as death, rather than an event that might happen, such as fire or theft.

30. ATM:  Automated teller machine – a computerised machine that allows bank customers to get information on their bank account, withdraw money or sometimes top up their phone in a public place, without dealing with another person.

31. Audit:  An independent examination of an organisation’s records and accounts to make sure that they show a fair, accurate and legal reflection of the financial position of the company at the accounting date

32. Auditor’s report:  A report by an independent person or firm on an organisation’s financial records

33. Authorised share capital: The highest amount of share capital that a company can issue, as set out by the company’s memorandum of association.

34. Available credit:  The difference between a person’s credit limit and the amount of money they have already borrowed or spent on their credit card.

35. Balance:  An amount of money, shown on a person’s statement, that they have in their account or that they owe at any time.

36. Balance brought forward:  An amount shown on a person’s last statement that is brought forward to the next statement, either to show money saved or money owed.

37. Balance transfer:  An amount a person owes on one credit or store card that they can switch to another credit card.

38. Balance sheet:  A summary of a company’s assets (what a company owns) and liabilities (debts a company owes) at a point in time.

39. Balloon payment:  A higher than normal final payment for a loan in return for lower regular repayments.

40. Bank :  An organisation that invests and lends money.

41. Bank identifier code:  A bank’s unique code, which is used when transferring money between banks, especially in different countries, and when exchanging messages; sometimes found on account statements.

42. Bankrupt: A situation of not having enough money to pay debts, declared by a court order.

43. Bankruptcy: A type of order issued by a court when a person cannot pay their debts when they are due, which allows the person’s property to be sold to raise money to pay their creditors.

44. Barter: A way of paying for things by exchanging goods and services instead of money.

45. Basic bank account: A service from a bank or building society that only lets a person spend what they have in their account so there is no risk of becoming overdrawn and running up overdraft charges.

46. Bear: Someone who sells shares now, expecting the share price to fall in the future so they can buy the shares back later at a lower price.

47. Benefactor: A person who gives a gift, for example in a will.

48. Beneficiary: A person who receives a gift.

49. Benefit statement: A statement, usually issued once a year, of the value of a person’s occupational pension.

50. Benefit-in-kind: A ‘perk’ of a job, such as a company car, gym membership or health insurance, that a company gives to its employees or directors and that may be subject to tax