Financial dictionary

Skip the Jargon - Cassie provides a breakdown of key financial terms to help you master the language of finance. Use our free financial dictionary to understand key terms and concepts to make informed, confident decisions for your business.

a

Accounts Payable (AP)Accounts Receivable (AR)Accounts Receivable TurnoverAccrualsAddendumsAdjusted EBITDAAllowance for Doubtful AccountsAmendmentsAmortizationAmortization ExpenseAmortization ScheduleAngel InvestorAnnual Contract Value (ACV)Annual Percentage Rate (APR)Annual Recurring Revenue (ARR)Anti-Takeover ProvisionsApplicable LawArbitrationAsset Purchase AgreementAsset Turnover RatioAssignment and Assumption AgreementAverage Revenue Per User (ARPU)Average Selling Price (ASP)

b

Bad Debt ExpenseBalance SheetBank LoanBase SalaryBasket and CapBenefits & Tax RatioBreach of ContractBreak-Up FeeBreakeven PointBusiness BrokerBusiness Continuity Plan (BCP)Business DataBusiness InsuranceBusiness PlanBusiness StrategyBusiness Valuation

c

C-CorporationCancellation FeeCapital Expenditure (CapEx)Capital ManagementCash AccountingCash FlowCash Flow StatementChange of Control ProvisionChart of AccountsChoice of ForumChoice of LawClosing ConditionsClosing DateClosing PeriodCo-signerCollateralCommission RateComp / Benefits RatioCompliance AuditConfidential InformationConfidential Information Memorandum (CIM)Confidentiality AgreementConsumer DataContribution MarginConversion RateCopyrightCost MethodCost of Goods Manufactured (COGM)Cost of Goods Sold (COGS)Cost of SalesCounterpartsCovenantsCross-sell RateCurrent AssetsCurrent LiabilitiesCurrent RatioCustomer Acquisition Cost (CAC)Customer Acquisition TimeCustomer ChurnCustomer Retention Rate

d

Deal FlowDeal Ramp TimeDeal Room/Data RoomDebentureDebt FinancingDebt RatioDebt Service Coverage RatioDebt-to-Equity RatioDeductible and LimitDeferred RevenueDeferred Tax AssetDeferred Tax LiabilityDemand GenerationDepreciationDepreciation ExpenseDepreciation ScheduleDirect CostsDisaster Recovery PlanDisclaimer of WarrantiesDisclosing PartyDiscount PercentageDiscounted Cash Flow (DCF)Dividend Payout RatioDown PaymentDrag-Along RightsDue DiligenceDue Diligence Period

e

EBITDAEarn-outEarnest MoneyEconomic Order Quantity (EOQ)Effective DateEfficiency RatioEmergency FundEmployee ProductivityEmployee Retention RateEmployee Turnover RateEncumbranceEntire Agreement ClauseEquity FinancingEquity MethodEquity RatioEscrowEscrow AccountExclusivity AgreementExclusivity PeriodExecution DateExit StrategyExpense Ratio

f

Facilities & Office Spend / HeadFinancial AuditFinancial ForecastFinancial PlanFinancial RiskFinancial Statement MetricsFinancial StatementsFinancial StrategyFixed Asset TurnoverForce Majeure

g

General LedgerGo-Shop ClauseGoodwillGross MarginGross RevenueGrowth RateGuarantor

h

Headcount Ratio

i

Income StatementIndefinite ContractsIndemnificationIndemnified PartyIndemnifying PartyIndemnity ClauseInspection RightsInstallment SaleIntegration PlanningIntellectual PropertyInterest Coverage RatioInterest RateInventory ObsolescenceInventory ShrinkageInventory Turnover

j

Just-In-Time (JIT) Inventory

k

Key Performance Indicators (KPIs)

l

LTV/CAC RatioLead Conversion RateLead GenerationLetter Of Intent (LOI)LiabilitiesLifetime Value (LTV)Limitation of LiabilityLine of CreditLiquidityLiquidity RatioLitigationLock-Up PeriodLong-Term AssetsLong-Term Liabilities

m

Management FeeMarginMarket ValueMarkup PercentageMaterial Adverse Change (MAC)Material Adverse Effect (MAE)Median Selling PriceMediationMezzanine FinancingMonthly Recurring Revenue (MRR)Monthly/Annual run rateMultiple

n

Net Book ValueNet IncomeNet Profit MarginNo-Shop Clause / ExclusivityNon-Compete AgreementNon-Disclosure Agreement (NDA)Non-Disclosure ExpirationNon-Solicit AgreementNoticeNovation Agreement

o

OTE (On-Target Earnings)Onboarding DurationOperating Expense RatioOperating IncomeOperating LeverageOperating MarginOperational Expenditure (OpEx)Option PeriodOther Contractual ProvisionsOverhead CostsOverhead RateOwner's BasisOwner's Capital Contributions

p

Personal InsurancePersonal RightsPersonally Identifiable Information (PII)Physical PropertyPipelinePost-Closing AdjustmentPrepaid ExpensesPrincipalPrivacy PolicyProductivity RateProfitPublic InformationPurchase AgreementPurchase Price Adjustment

q

Quick Ratio

r

Real Estate AgentReceiving PartyReleaseRenewalReporting PeriodRepresentations and WarrantiesRetained EarningsRetention RatioReturn On Ad Spend (ROAS)Return on Assets (ROA)Return on Equity (ROE)Return on Investment (ROI)Revenue ChurnRevenue Retention RateRevenue per EmployeeRevenue per Square FootReverse Termination FeeRight Of First Refusal (ROFR)Right of First Offer (ROFO)Risk Management

s

S-CorporationSales Cycle LengthSales FunnelSales TaxSalesperson ROISalesperson Ramp TimeSandbaggingSecured LoanSellers NoteSensitive InformationSeverability ClauseShareholder RightsSignature DateSolvency RatioStandalone ValueStock Purchase AgreementStraight SaleStrategic PlanningSubsidiary LedgerSuccession PlanSuccessor and AssignsSurvival PeriodSynergy

t

Tag-Along RightsTangible AssetsTechnology Spend / HeadTerm / DurationTerm LoanTerm SheetTerm of the AgreementTermination FeeTime to LiveTime to Market (TTM)Time to OnboardTotal Asset TurnoverTotal Contract Value (TCV)Total Operational Cost per HeadTraditional File SharingTraining Costs / HeadTrust Account

u

Unsecured LoanUpsell RateUse Of MarksUtilization Rate

v

Value-Added Tax (VAT)Variable / Fixed Compensation SplitVariable OTE (On Target Earnings)Venture CapitalVesting PeriodVoting Rights

w

WaiverWarranty Period in M&AWorking Capital
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