Glossary: Joint venture
A joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement.
A joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement.
The writing down of the value of an asset when the recoverable amount of that asset is below its carrying value.
Abbreviation of International Financial Reporting Standards. Refers to individual accounting standards issued with a reference IFRS xx, where xx is a number. IFRS is also often used to mean international accounting standards generally.
(International Accounting Standards Board) Organisation responsible for issuing the international accounting standards.
Abbreviation of International Accounting Standards. Refers to individual accounting standards issued with references IAS xx, where xx is a number. These standards, together with those issued under an ‘IFRS’ reference, make up international accounting standards.
Abbreviation of Her Majesty’s Revenue and Customs, a department of the UK Government responsible for the assessment and collection of taxes.
Accounting convention whereby assets are recorded in a company’s books based on the price paid for them (as opposed to the market value or replacement cost of those assets at the balance sheet date).
The price earnings ratio calculated using the most recently reported earnings figure
A transaction undertaken to ‘cancel out’ the effect of any future change in a variable that may affect a company’s profits, such as interest rates, exchange rates, commodity costs.
The difference between what an investor company paid for the shares in a subsidiary or an associate/joint venture and the net fair value of the assets and liabilities of the subsidiary/associate/joint venture
One of the basic accounting concepts: when preparing the balance sheet, it is assumed that the company will continue in business for the foreseeable future.
(Debt to equity ratio) General term used to describe the use of debt as well as equity to fund a company. The term is used more specifically to describe the ratio of debt to equityÂ
A designated hedging arrangement under which any change in value in the underlying hedged item would not otherwise be reflected in the balance sheet and the change in value in the hedging item (usually a derivative) would be, so the change in value in the hedged item is therefore reflected in the P&L.
Broadly, the price at which you could buy the asset or ‘sell’ the liability in an ‘orderly’ market at the market conditions on the balance sheet date.
Reduction in earnings per share as a result of the company issuing new shares.