Glossary
Finance glossary in Arabic and English
Clear definitions of the terms finance teams use every day, from the trial balance to zakat, each with an example.
- Accounts payableAccounts payable is the money a company owes its suppliers for goods and services it has received but not yet paid for.
- Accounts receivableAccounts receivable is the money customers owe a company for goods or services it has already delivered on credit.
- Accrual accountingAccrual accounting records income when it is earned and expenses when they are incurred, in the period they belong to, whether or not cash has changed hands.
- Aging reportAn aging report lists open customer invoices, or supplier bills, grouped by how long they are past their due date, for example current, 1 to 30, 31 to 60, 61 to 90 and over 90 days.
- Audit trailAn audit trail is a time-ordered record of who did what, when and to which record, including approvals and changes.
- Cash applicationCash application is matching each customer payment to the invoices it settles, so the receivables ledger shows exactly what every customer still owes.
- Cash flow statementA cash flow statement shows how a company's cash and cash equivalents changed over a period, split into operating, investing and financing activities.
- Chart of accountsA chart of accounts is the list of every account a company uses to record transactions, each with a code and a name, grouped into assets, liabilities, equity, income and expenses.
- Consolidated financial statementsConsolidated financial statements present the assets, liabilities, equity, income, expenses and cash flows of a parent and its subsidiaries as those of a single economic entity.
- Cut-off in accountingCut-off is the discipline of recording every transaction in the accounting period in which it happened, no earlier and no later.
- Days sales outstanding (DSO)Days sales outstanding (DSO) is the average number of days a company takes to collect cash after a sale.
- Deferred revenueDeferred revenue is money a customer has paid, or owes, before the company has delivered the goods or services.
- Delegation of authorityA delegation of authority (DoA) is a document, usually approved by the board, that sets who in the company may approve which decisions and up to what amount.
- DepreciationDepreciation is the systematic allocation of an asset’s depreciable amount, its cost less its residual value, over its useful life.
- DunningDunning is the structured process of reminding customers about invoices that are due or overdue, with each reminder firmer than the last.
- Fixed asset registerA fixed asset register is the detailed list behind the fixed asset balances in the ledger: one line per asset with its description, location, cost, date, useful life, depreciation method, accumulated depreciation and carrying amount.
- Foreign currency translationForeign currency translation converts a company’s financial statements from its functional currency into another presentation currency, usually the group’s.
- Four-eyes principleThe four-eyes principle requires that a significant action is checked or approved by a second, independent person before it takes effect.
- FP&AFP&A, financial planning and analysis, is the part of a finance team that plans the company's future results and explains its current ones.
- Functional currencyA company’s functional currency is the currency of the primary economic environment in which it operates, usually the currency in which it mainly earns and spends cash.
- IFRS 15IFRS 15 Revenue from Contracts with Customers is the IFRS standard on revenue.
- IFRS 16IFRS 16 Leases is the IFRS standard on leases.
- Input VATInput VAT is the VAT a business pays on its purchases and imports.
- Intercompany transactionsIntercompany transactions are dealings between companies in the same group: sales of goods, services, management fees, cost recharges, loans and dividends.
- Three-way matchA three-way match checks a supplier bill against two other documents before it is paid: the purchase order, which says what was ordered and at what price, and the goods receipt, which says what actually arrived.
- Trial balanceA trial balance is a list of every account in the general ledger with its closing debit or credit balance at one date.
- Withholding taxWithholding tax (WHT) is tax that the payer deducts from a payment and pays to the tax authority on the recipient's behalf.
- Working capitalWorking capital is current assets minus current liabilities: the short-term resources a business has left after covering its short-term obligations.
See it on your own books
A guided demo on Demo Group's books, then we connect one of your companies. In Arabic or English.