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Financial Terms | |
Future-Oriented Financial Information |
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Definition of Future-Oriented Financial InformationFuture-Oriented Financial Informationinformation about prospective results of operations, financial position and/or changes in financial position, based on assumptions about future economic conditions and courses of action. future-oriented financial information is presented as either a forecast or a projection.
Related Terms:Asymmetric informationinformation that is known to some people but not to other people. Changes in Financial PositionSources of funds internally provided from operations that alter a company's chief financial officer (CFO)Officer who oversees the treasurer and controller and sets overall financial strategy. Corporate financial managementThe application of financial principals within a corporation to create and Corporate financial planningfinancial planning conducted by a firm that encompasses preparation of both costs of financial distressCosts arising from bankruptcy or distorted business decisions before bankruptcy. Country financial riskThe ability of the national economy to generate enough foreign exchange to meet ![]() Currency futureA financial future contract for the delivery of a specified foreign currency. Deferred futuresThe most distant months of a futures contract. A bond that sells at a discount and does not Dupont system of financial controlHighlights the fact that return on assets (ROA) can be expressed in terms Expected future cash flowsProjected future cash flows associated with an asset of decision. Expected future returnThe return that is expected to be earned on an asset in the future. Also called the Expected value of perfect informationThe expected value if the future uncertain outcomes could be known External Financial StatementsCorporate financial statements that have been reported on by an external independent accountant. Financial accountingThe production of financial statements, primarily for those interested parties who are external to the business. financial accountinga discipline in which historical, monetary Financial analystsAlso called securities analysts and investment analysts, professionals who analyze Financial assetsClaims on real assets. financial assetsClaims to the income generated by real assets. Also called securities. Financial AssistanceEconomic assistance provided by unrelated third parties, typically government agencies. They may take the form of loans, loan guarantees, subsidies, tax allowances, contributions, or cost-sharing arrangements. financial budgeta plan that aggregates monetary details Financial controlThe management of a firm's costs and expenses in order to control them in relation to Financial CovenantA feature of a debt or credit agreement that is designed to protect the lender or creditor. It is common to characterize covenants as either positive or negative covenants. Financial CovenantsA promise made related to financial conditions or events. Often a promise not to allow certain balance sheet items or ratios to fall below an agreed level. Usually found in loan documents, as a protection mechanism. Financial distressEvents preceding and including bankruptcy, such as violation of loan contracts. Financial distress costsLegal and administrative costs of liquidation or reorganization. Also includes Financial engineeringCombining or dividing existing instruments to create new financial products. Financial futureA contract entered into now that provides for the delivery of a specified asset in exchange financial incentivea monetary reward provided for performance Financial IncentiveAn expression of economic benefit that motivates behavior that might otherwise not take place. Financial intermediariesInstitutions that provide the market function of matching borrowers and lenders or financial intermediaryFirm that raises money from many small investors and provides financing to businesses or other Financial IntermediaryAny institution, such as a bank, that takes deposits from savers and loans them to borrowers. Financial IntermediationThe process whereby financial intermediaries channel funds from lender/savers to borrower/spenders. Financial leaseLong-term, non-cancelable lease. Financial LeaseLease in which the service provided by the lessor to the lessee is limited to financing equipment. All other responsibilities related to the possession of equipment, such as maintenance, insurance, and taxes, are borne by the lessee. A financial lease is usually noncancellable and is fully paid out amortized over its term. Financial leverageUse of debt to increase the expected return on equity. financial leverage is measured by financial leverageThe equity (ownership) capital of a business can serve financial leverageDebt financing amplifies the effects of changes in operating income on the returns to stockholders. Financial leverage clienteleA group of investors who have a preference for investing in firms that adhere to Financial leverage ratiosRelated: capitalization ratios. Financial marketAn organized institutional structure or mechanism for creating and exchanging financial assets. financial marketsMarkets in which financial assets are traded. Financial Numbers GameThe use of creative accounting practices to alter a financial statement Financial objectivesObjectives of a financial nature that the firm will strive to accomplish during the period Financial planA financial blueprint for the financial future of a firm. Financial planningThe process of evaluating the investing and financing options available to a firm. It Financial PositionStatus of a firm's assets, liabilities, and equity accounts as of a certain time, as shown in its financial statement. Financial pressThat portion of the media devoted to reporting financial news. Financial ratioThe result of dividing one financial statement item by another. Ratios help analysts interpret financial reports and statementsfinancial means having to do with Financial reports or statementsThe Profit and Loss account, Balance Sheet and Cash Flow statement of a business. Financial riskThe risk that the cash flow of an issuer will not be adequate to meet its financial obligations. financial riskRisk to shareholders resulting from the use of debt. financial slackReady access to cash or debt financing. Financial Trend AnalysisProcess of analyzing financial statements of a company for any continuing relationship. Financial yearThe accounting period adopted by a business for the production of its financial statements. Fraudulent Financial ReportingIntentional misstatements or omissions of amounts or disclosures FutureA term used to designate all contracts covering the sale of financial instruments or physical Future investment opportunitiesThe options to identify additional, more valuable investment opportunities Future valueThe amount of cash at a specified date in the future that is equivalent in value to a specified Future ValueThe amount a given payment, or series of payments, will be worth future valuethe amount to which one or more sums of Future valueThe value that a sum of money (the present value) earning future valueAmount to which an investment will grow after earning interest. Future ValueThe amount to which a payment or series of payments will grow by a given future date when compounded by a given interest rate. FVIF future value interest factor. FuturesA term used to designate all contracts covering the sale of financial instruments or physical Futures commission merchantA firm or person engaged in soliciting or accepting and handling orders for Futures contractAgreement to buy or sell a set number of shares of a specific stock in a designated future futures contractExchange-traded promise to buy or sell an asset in the future at a prespecified price. Futures ContractA contract in which the seller agrees to provide something to a buyer at a specified future date at an agreed price. Futures contract multipleA constant, set by an exchange, which when multiplied by the futures price gives Futures marketA market in which contracts for future delivery of a commodity or a security are bought or sold. Futures optionAn option on a futures contract. Related: options on physicals. Futures priceThe price at which the parties to a futures contract agree to transact on the settlement date. informationbits of knowledge or fact that have been carefully Information asymmetryA situation involving information that is known to some, but not all, participants. Information Coefficient (IC)The correlation between predicted and actual stock returns, sometimes used to Information-content effectThe rise in the stock price following the dividend signal. information content of dividendsDividend increases send good news about cash flow and earnings. Dividend cuts send bad news. Information costsTransaction costs that include the assessment of the investment merits of a financial asset. Information-motivated tradesTrades in which an investor believes he or she possesses pertinent Information servicesOrganizations that furnish investment and other types of information, such as Informational efficiencyThe speed and accuracy with which prices reflect new information. Informationless tradesTrades that are the result of either a reallocation of wealth or an implementation of an Insider informationRelevant information about a company that has not yet been made public. It is illegal for London International Financial Futures Exchange (LIFFE)A London exchange where Eurodollar futures London International Financial Futures Exchange (LIFFE)London exchange where Eurodollar futures as well as futures-style options are traded. Long-term financial planfinancial plan covering two or more years of future operations. management information system (MIS)a structure of interrelated elements that collects, organizes, and communicates Medical Information BureauThis organization was established in 1902. The Medical information Bureau (M.I.B.) is a non-profit association of life insurance companies. Its purpose is to detect and deter fraud by providing warnings called, alerts, to member companies. For example, if an insurance applicant advised one insurance company of a heart attack and then applied to another insurance company omitting this history, codes, reported by the first insurance company, indicating a heart attack would alert the second insurance company to the undisclosed history. It is a rarity, however, that the alert is the only notice of a specific medical impairement as most applicants completely disclose their history. Most distant futures contractWhen several futures contracts are considered, the contract settling last. National Futures Association (NFA)The futures industry self regulatory organization established in 1982. Nearby futures contractWhen several futures contracts are considered, the contract with the closest Net present value of future investmentsThe present value of the total sum of NPVs expected to result from Next futures contractThe contract settling immediately after the nearby futures contract. Non-financial servicesInclude such things as freight, insurance, passenger services, and travel. Notes to the financial statementsA detailed set of notes immediately following the financial statements in Perfectly competitive financial marketsMarkets in which no trader has the power to change the price of Related to : financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit. |