A1. ABC Method of Inventory control: Method that controls expensive inventory items more

closely than less expensive item.2. Accounts Payable: The amounts due to suppliers of goods and services of an organization.3. Accounting rate of return: Calculated by dividing the average income after tax by the

initial outlay of project.4. Account Receivable: Amounts of money owed to a firm by customer who has bought goods

or services on credit.5. Acid test Ratio: A measured of liquidity, defined as current assets fewer inventories divided

by current Liabilities.6. Acquisition: When a firm buys another firm.7. Actuary: A professional who is specialized in the field of insurance.8. After Tax Cash flow: Total cost generated by an investment annually, defined as profit after

tax plus depreciation or equivalently, operating income after tax plus the tax rate times depreciation.

9. Agency Problem: conflicts of interest among stockholders bondholders, and managers.10. Amalgamation: The joining of two or more business, also called merger.11. Amortization: Process of writing of or liquidating an asset or loan periodically on an

installment basis.12. Annual Report: Yearly record of a publicly held company’s financial condition.13. Annuity: A series of uniform receives (payment) for a specific number of years, which

results from an initial deposit (receipts).14. Annuity Due: An annuity with n payment, where the first payment is made at time t =0 and

the last payment is made at time t=n-1.15. Annuity factor: Present value of Tk. 1 paid for each of t periods.16. Appreciation: Increase in the value of an asset.17. Arbitrage: The simultaneous buying and selling of a security at two different prices in two

different markets.18. Asset: Anything owned by an individual or a business, which has commercial or exchange

value.19. ATM: A computerized machine that enables customers to withdraw cash from their current

accounts especially outside normal banking hours.20. Average collection period: Average amount of time required to collect an account

receivable. Also knows as days sales outstanding.

B1. Balance Sheet: A summary of affirms financial positions on a given date that shows total

assets= total liabilities+ owners equity.2. Beta: An index of systematic risk. It measures the sensitivity of a stock’s returns to change in

returns on the market portfolio.3. Bill of Lading: A shipping document indicating the detail of the shipment and delivery of

goods and their ownership.

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4. Bond: A long term debt instrument issued by a corporation or government.5. Bond Premium: The amount by which the current price of a bond exceeds its current price.6. Bond discount: The amount by which the face value of a bond exceeds its current price.7. Book Value: An asset the accounting value of an asset- the asset’s cost minus its

accumulated depreciation.8. Break- even point: The sales volume required so that total revenue and total costs are equal.9. Break-even analysis: A technique for studying the relationship among fixed costs, variable

cost, sales volume and profits. Also called cost volume profit analysis.10. Back to Back Letter of Credit: Two letters of credit (LCs) used together to help a seller

finance the purchase of equipment or services from a subcontractor. With the original LC from the buyer's bank in place, the seller goes to his own bank and has a second LC issued, with the subcontractor as beneficiary. The subcontractor is thus ensured of payment upon fulfilling the terms of the contract. 

11. Balance of Payment:

C1. Capital asset Pricing model (CAPM): A model that describes the relationship between risk

and expected return.2. Capital Budgeting: The Process of identifying, analyzing and selecting investment projects

whose returns are expected to extend beyond one year.3. Capital Gain (Loss): The amount by which the proceeds from the sales of a capital asset

exceeds the assets original cost.4. Capital Market: The market for relatively long term (greater than one year original

maturity) financial instruments (Bonds, and stocks).5. Capital Structure: The mix of a firms permanent long term financing represented by debt,

preferred stock and common stock equity.6. Cash cycle: The length of time from the actual outlay of cash for purchase until the

collection of receivables resulting from the sale of goods or services, also called cash conversion cycle.

7. Commercial Paper: Short term unsecured promissory notes generally issued by large corporations.

8. Common Stock: Securities that represent the ultimate ownership position in a corporation.9. Compound interest: Interest paid on any previous interest earned as well as on the principal

borrowed.10. Cost of Capital: The required rate of return on the various types of financing.11. Cost of debt: The required rate of return on investment of the common share holders of the

company.12. Cost of goods sold: Beginning inventory plus cost of goods purchased or manufactured

minus ending inventory.13. Cost of Preferred stock: The required rate of return on investment of the preferred share

holders of the company.14. Coupon Rate: The stated rate of interest on a bond.15. Current Ratio: Current asset divided by Current Liability.

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D1. Debenture: A long term, unsecured debt instrument.2. Debt Ratio: Ratio that show the extent to which the firm is financed by debt.3. Declining –balance depreciation: Methods of depreciation calling for an annual charge

based on a fixed percentage of the assets depreciated book value at the beginning of the year for which the depreciation charge applies.

4. Depreciation: The systematic allocation of the cost of a capital asset over a period of time for financial reporting purposes, tax purpose, or both.

5.

T1. Tangible Assets: An asset whose value depends on particular physical properties. It includes

assets such as building, machinery, land, mine, work of art etc. also called real assets.2. Tax holiday: A period during which a company is executed from paying taxes as an export

incentive or an incentive to start up a new industry.3. Tax: A tax (from the Latin taxo; "rate") is a financial charge or other levy imposed upon a

taxpayer (an individual or legal entity) by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many administrative divisions. Taxes consist of direct or indirect taxes and may be paid in money or as its labor equivalent.

4. Tenor: Maturity of a loan.5. Term Loan: A bank loan, with a floating interest rate, for a specified amount that matures in

between one and ten years and requires a specified repayments schedule.6. Term life Insurance: life insurance which provides coverage at a fixed rate of payments for

a limited period of time, the relevant term.7. Tight Money: A term to indicate time periods in which financing may be difficult to find

and interest rates may be quite high by normal standers. Also called dear money.8. Time Deposit: An interest paying account that has a fixed maturity date, often called

certificate of deposit.9. Time –interest earned ratio:  A measure of a company's ability to honor its debt payments.

It may be calculated as either EBIT or EBITDA divided by the total interest payable.10. Trademark: A unique name, word, or symbol used to identify a product.11. Trading: Buying and selling of securities.12. Treasury Bills (T-Bills): Short term noninterest bearing obligation of the government

treasury issued at a discount and redeemed at maturity for full face value.13. Treasury Bonds: Long term (more than 10 years original maturity) obligation of the

government treasury.14. Treasury Notes: Medium term (2-10 years original maturity) obligation of the government

treasury.15. Treasury Stock: Common stock that has been repurchased and is held by the issuing

company.

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16. Trend analysis: Trend Analysis is the practice of collecting information and attempting to spot a pattern, or trend, in the information. In some fields of study, the term "trend analysis" has more formally defined meanings

17. Trend: The general direction of the market.18. Treynor Index: A measure of risk-adjusted performance of an investment portfolio. The

Treynor Index measures a portfolio's excess return per unit of risk, using beta as the risk measure; the higher this number, the greater "excess return" being generated by the portfolio. The index was developed by economist Jack Treynor. Also known as the Treynor Ratio. 

19.

U1. Underwriters: Investment bankers that purchase securities from the issuing company and

resell them.2. Underwriting: A process by which investment banker purchases shares from an issuer and

sell it to the public.3. Unsystematic risk: Company or industry specific risk that is inherent in each investment.

The amount of unsystematic risk can be reduced through appropriate diversification. Also known as "specific risk," "diversifiable risk" or "residual risk."

W1. Warrant: A relatively long term option to purchase common stock at a specified exercise

price over a specified period of time.2. Waiting period: Time during the security and exchange commission studies a firm’s

registration statement.3. Weak Market: A market with a few buyers and many sellers and a declining trend in prices.4. Weak from Efficiency: A security price reflects all market related data. Such as historical

security price movement and volume of securities traded.5. Wealth Maximization: Maximization of the value of the shareholders.6. Weighted average cost of capital: The rate that a company is expected to pay on average to

all its security holders to finance its assets.7. WIP: Work in process, work in progress, (WIP) goods in process, or in-process

inventory are a company's partially finished goods waiting for completion and eventual sale or the value of these items. These items are either just being fabricated or waiting for further processing in a queue or a buffer storage. The term is used in production and supply chain management.

8. Working capital management: The administration of the firm’s current assets and the financing needed to support current assets.

9. Working Capital cycle: The working capital cycle measures the amount of time that elapses between the moment when your business begins investing money in a product or service, and the moment the business receives payment for that product or service.

10. Working Capital Ratio: Working Capital expressed as a percentage of a sales.

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11. Working Capital Turnover: Shows how efficiently working capital is employed, measuring the amount of net revenue generated per taka of working capital.

12. Working capital: (abbreviated WC) is a financial metric which represents liquidity available to a business, organization or other entity, including governmental entity. Along with fixed assets such as plant and equipment, working capital is considered a part of operating capital. Net working capital is calculated as current assets minus current liabilities

Y1. Yield to maturity: The expected rate of return on a bond if bought at its current market price

and held to maturity.2. Yield: The premised rate of return on an investment under certain assumption.

Z1. Zero coupon Bond: A bond that pays no interest but sells at a deep discount from its face

value.

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