A Glossary of Business and Financial Terms



  • Acceptance of Offer

    A buyer's agreement to purchase goods or services from a seller

  • Acceptance of Order

    A seller's agreement to provide goods at a defined price

  • Account Number

    A unique identifier designating a particular account. Typically, the first digits indicate account group or corporation, the middle digits indicate a budget group or department, and the final two digits specify the sub-account.

  • Account Rollover

    Permitting account numbers to be transferred from the current fiscal year to the upcoming fiscal year. Only active accounts are rolled over, while closed, inactive, or zero-balance accounts are not.

  • Adjusted Balance

    The true balance of a checking account, after pending debits and credits have been recorded


  • Balance Forward

    A proceeding that transfers an account's remaining balance from the current fiscal year into the upcoming fiscal year

  • Budget Group

    A group of associated accounts, typically assigned to the same business unit. Budget groups can be identified by their account numbers having the same first and middle digits.

  • Bundle

    A group of items intended to be inventoried together


  • Cannibalization

    The practice of removing parts from one piece of equipment for direct use on another piece of equipment

  • Capital

    Money invested in a business, whether in the form of cash or possessions

  • Capital Equipment

    Equipment having a certain minimum cost and having an expected service life of several years. The value of capital equipment is depreciated over time.

  • Cash Sales

    Sales of goods or services by a company in exchange for cash or other immediate payment (such as credit card)


  • Depreciated Value

    An asset's value, derived from its acquisition cost and modified by its remaining useful life

  • Diversification

    Investing capital across multiple types and categories. Diversification reduces the risk of exposure to any single investment type, category, or market.


  • Electronic Signature

    A form of signature designed to take the place of a handwritten (or "wet") signature. An electronic signature has the same legal effect as a traditional signature while being more convenient for modern business transactions.

  • Endowment

    A donation to a tax-exempt organization designed to use its earnings for future expenditures. In an endowment (as opposed to a simple donation), the principal is retained and used to generate income.


  • Fiduciary

    A party charged with a duty to act within the best interests of another party. A fiduciary can be a person or a company.

  • Fund Balance

    The total of cash on hand, disbursements, and vouchers that make up a petty cash fund


  • Gratuity

    Sometimes called a tip, a gratuity is payment voluntarily given in exchange for service. The gratuity is typically over and above the standard price of the service and is intended to directly compensate a staff member (as opposed to the employer).


  • Historical Value

    An asset's cost when purchased


  • Imprest Fund

    A petty cash fund used to cover incidental expenses. Employees use a voucher system to track cash in and out of the imprest fund.

  • Incidental Expense

    An expense that occurs when traveling on official business. This does not include common personal expenses such as meals and lodging.

  • Income

    The money earned by a business, including interest and dividends from investments

  • Inventory Number

    A unique identifier assigned to a piece of equipment for tracking purposes

  • Investment

    Money assigned to a property, stock, or other vehicle for the purpose of growth or income


  • Jurat

    A clause added to an affidavit stating the time and place of the affidavit as well as the authority before whom the affidavit was sworn


  • Lease

    A contract for the use of property. The lessee receives the right of use, but the lessor retains legal ownership of the property.

  • Liquidity

    The ability to convert an investment to cash without significant delay or penalty


  • Market Value

    The price of a security (such as a stock) at a particular point in time

  • Money Market Fund

    A mutual fund that invests in money market instruments. This is considered a low-risk, low-return investment vehicle.


  • Non-Working Hours

    Also known as non-productive hours, including all portions of a day other than working hours, like lunches, breaks, time off, etc.


  • Official Signer

    An officer of the company who is authorized to sign legally binding accounting documents

  • Outstanding Checks

    Checks that have been written but not yet cashed


  • Payment Voucher

    A form used to track cash in and out of an imprest fund

  • Portfolio

    All investments held by a person or company

  • Professional Services

    Labor that can be performed by an outside agency in a more timely, cost-effective, or skilled manner than when using company employees


  • Quasi-Endowment

    An endowment that can be dissolved and returned to the donor under certain circumstances


  • Real Property

    Land and buildings owned by a person or company

  • Record

    An official document recording the activities of a company, person, or government agency

  • Reimburse

    To repay a person in kind for expenditures they have incurred


  • Sales Tax

    A state tax on the sale or rental of goods and services

  • Signature Authority

    The ability to sign legally binding documents on behalf of a company. A person's authority may be limited to their department or budget group.

  • Social Security Number

    A unique identifier assigned to individuals for tracking in the Social Security system

  • Sole Proprietor

    A person who wholly owns a company


  • Tangible Personal Property

    Items that can be owned, traded, or sold

  • Tax-Exempt

    Any person or company that is not required to pay sales tax on a particular transaction

  • Travel Expense

    Personal expenses incurred during travel, typically including things like food and lodging

  • Sole Proprietor

    A person who wholly owns a company


  • Unit

    A specified business group, such as a department or team


  • Visa

    A passport stamp required for entry into a country


  • Work Day

    A day on which work is performed. The number of days may vary depending on the business type: a retail location may be open Monday through Saturday, while a hospital would typically be open seven days per week.

  • Working Hours

    Also known as productive hours, these are the hours of a work day when business is conducted and an employee is scheduled to perform such work.