Succession Planning: A
a Talent: An employee that is assigned to a Talent Group
ABATEMENT: -- A reduction in the assessment of tax, penalty or interest when it is determined the assessment is incorrect
ABUSE OF LAW --: The doctrine which allows the tax authorities to disregard a civil law form used by the taxpayer which has no commercial basis
ACCELERATED DEPRECIATION --: Method of depreciation under which taxpayers may allocate larger depreciation deductions to the first year or first few years of useful business assets, such as plant and machinery
Account Balance: The amount held in an account at the end of a reporting period. For example, a credit card account balance would show the amount owed to a lender as a result of purchases made during a specific period.
Accountability System: A system that contributes to agency performance by monitoring and evaluating the results of its human capital management policies, programs, and activities; by analyzing compliance with merit system principles; and by identifying and monitoring necessary improvements.
ACCO UNTING BASIS: -- Method of calculating amounts subject to income tax and VAT. In respect of VAT, tax would be computed as a percentage levy on the excess of sales over purchases. This is a theoretical concept and no country uses it.
ACCOUNTING PERIOD:-- A period of time used by taxpayer for the determination of tax liability
ACCOUNTING RECORDS --: All documents and books used in the preparation of the tax return and all financial statements, including general ledger, subsidiary ledgers, sales slips, and invoices.
ACCOUNTS PAYABLE: -- A list of the debts currently owed by a person or business, mainly for the purchase of services, inventory, and supplies
ACCOUNTS RECEIVABLE: -- A list of the money owed on current account to a creditor, which is kept in the normal course of the creditor's business and represents unsettled claims and transactions
Accredited Education: Education above the high school level completed in a U.S. college, university, or other educational institution that has been accredited by one of the accrediting agencies or associations recognized by the Secretary, U.S. Department of Education.
ACCRUAL BASIS (ACCRUAL METHOD): -- An accounting method whereby income and expense items are included in taxable income or expense as they are earned or incurred, rather than when they are received or paid
Acquisition: The part or whole procurement of one company by another
Acquisition finance: Funding which is deployed to support an acquisition or series of acquisitions, which can be in the form of debt or equity.
Action Learning: Project-based learning directed at important business problems, where the participant works alone, or with cohorts, on a real business challenge while analyzing and discussing progress and lessons learned.
Active: Family members working on the farm or in the agribusiness.
Ad colligenda bona: – Latin phrase which describes a person to whom the court has made a limited or temporary grant of letters of administration for the purpose of collecting the property or part of the property of a deceased person where that property is of a perishable or precarious nature or where a regular administration cannot be granted at once. The function of this type of grant is to protect the asset from wasting; to enable an administration of such an asset, because if not dealt with it may deteriorate or diminish in value before an application for a grant of probate or letters of administration can be made in a timely and orderly way.
AD VALOREM TAX: -- A tax on goods or property expressed as a percentage of the sales price or assessed value
ADDIE: is an instructional systems design model. It is composed of five phases:• Analysis is the process of gathering data to identify specific needs—the who, what, where, when, and why of the design process.• Design is the planning stage.• Development is the phase in which training materials and content are selected and developed based on learning objectives.• Implementation occurs when the course is delivered, whether in person or electronically.• Evaluation is the ongoing process of developing and improving instructional materials based on feedback received during and after implementation.
Ademption –: Latin origin meaning taking away. In succession law if a gift specified in a will doesn’t exist when the will-maker dies, the person named to receive it gets nothing because the gift has been taken away or in other words, taken out of the will.
Adjustable-Rate Mortgage (ARM): A mortgage with an interest rate that is adjusted periodically based on an index. Adjustable-rate mortgages generally have lower initial interest rates than fixed-rate mortgages because the lender is able to transfer some of the risk to the borrower; if prevailing rates go higher, the interest rate on a variable mortgage may adjust upward as well.
Adjusted Gross Income (AGI): An interim calculation in the computation of income tax liability. It is computed by subtracting certain allowable adjustments from gross income.
ADMINISTRATIVE COMPANY: -- See: Service company
ADMINISTRATIVE EXPENSES: -- Expenses that are not as easily associated with a specific function as are the direct costs of manufacturing and selling. It typically includes expenses of the headquarters office and accounting expenses.
ADMINISTRATIVE OFFICE: -- Office frequently located in a country other than that of the headquarters office, the parent company or country of operation.
Administrator: – A person identified in a will or appointed by a court to carry out the instructions found in a will. Depending on the state, this may be referred to as the executor or personal representative.
Administrator –: a person appointed by the Supreme Court to administer a deceased estate when the deceased has not left a will, or if they have for some reason the nominated executor is unable to or does not wish to act.
Administrator cta: .
Administrator cta –: cta is the short form of the Latin phrase cum testamento annexo. It means ‘with the will annexed’. In situations where the will is incomplete, for example it maybe that no executor was named, the appointed executor has since become incapacitated, or does not wish to act as executor, an application may be made to the Probate Court to appoint someone else. If the Probate Court approves, it grants what is called ‘letters of administration with the will annexed’, sometimes written as ‘Letters of Administration cta’. The Probate Court is a specialist division of the Supreme Court, in each state and territory, and usually has its own registry office.
Adult Learning Theory: is a term that encompasses the collective theories and principles of how adults learn and acquire knowledge. Popularized by Malcolm Knowles, adult learning theory provides the foundation that training and development professionals need to meet workplace learning needs.
ADVANCE PRICING ARRANGEMENT (APA): -- An arrangement that determines, in advance of controlled transactions, an appropriate set of criteria (e.g. method, comparables and appropriate adjustments thereto, critical assumptions as to future events) for the determination of the transfer pricing for those transactions over a fixed period of time. An advance pricing arrangement may be unilateral involving one tax administration and a taxpayer or multilateral involving the agreement of two or more tax administrations.
ADVANCE RULING: -- A letter ruling, which is a written statement, issued to a taxpayer by tax authorities, that interprets and applies the tax law to a specific set of facts
ADVANCED ESTATE PLANNING: For people with large estates, the IRS can take as much as 50% in Federal Estate Taxes. The good news is estate taxes can be reduced or even eliminated through proper planning! But ONLY if you properly plan to avoid them!
Advanced health directive: – also known as an advance care directive, living will and similar expressions. These documents are about recording individual preferences ahead of unforseen events such as an accident or terminal illness which may impair decision making capacity regarding treatment and end of life care.
Advisors: When you run a Process and, hopefully, complete a PE deal there are raft of men in suits (with the very occasional woman) who “help”. As a group they are called Advisors. This group includes your Investment Bank your lawyers and the various due-diligence providers.Advisors produce two outputs :A huge raft of documents of varying quality attempting to explain your business, it’s market, the opportunities and obstacles.A huge raft of bills of varying sizes (see “Deal Fees“).In my experience there is little correlation between the two outputs. The bigger your company is, the bigger “brand” people tend to want on the report then the bigger the bill tends to be.
Affective Learning: is the acquisition of knowledge based on Benjamin Bloom’s taxonomy in which he identified three learning domains: cognitive (knowledge), affective (attitude), and psychomotor (skills). This taxonomy or classification of the processes of thinking and learning provides the framework for the creation of instructional strategies, materials, and activities used to improve individual workplace learning and performance. Affective refers to the learners’ outlook or mindset.
Affidavit –: a sworn written statement, that is a written statement made on oath by a person setting out the facts relevant to their case, and which becomes the evidence they rely on in court proceedings. It supports the issues in dispute. An affidavit can provide particulars of inquiries and investigations. The person making it (called a deponent) must swear or affirm that everything said in it is true before a person authorised by law to administer oaths. The word affidavit originated from Latin, meaning testimonium, evidence, testimony, proof.
Affidavit in support –: when an affidavit is used to support an application to a court for orders of some kind.
AFFILIATED COMPANIES: -- General term used to describe the relationship between two or more companies linked by a common interest
AFFILIATION PRIVILEGE: -- Tax relief or exemption accorded to dividend distributions made by a resident subsidiary company to its parent company which owns a certain minimum percentage of shares, in order to mitigate double taxation of such dividends.
Affinity, relationship of –: a related by marriage.
After-Tax Return: The return from an investment after the effects of taxes have been taken into account.
AGENCY: -- A business that provides a particular service to a company (that are outside of the country where the agency is located). Dependent agency constitutes a permanent establishment for the other company and the income achieved through the agency is taxed on the income earned from the country where the agency is located whereas independent agency does not.
Agency Certification Program: A certification developed by an agency, group of agencies, or other group that demonstrates a person’s proficiency in the job-related competencies/KSAs. An agency certification program does not have to be recognized by a professional community.
Agent (Power of Attorney).: An Agent, sometimes called an "attorney-in-fact" under a legal and financial power of attorney is a person you have designated to serve as your agent to manage your legal and financial affairs. An Agent may be designated individually, or jointly, or jointly and severally, to act on your behalf presently or, alternatively, only in the event of your incapacity.
AGGREGATION: -- Term used to denote the adding together of the taxpayer's income from all sources in order to determine the applicable tax rate for income tax purposes.
Aggressive Growth Fund: A mutual fund whose primary investment objective is substantial capital gains. The return and principal value of mutual funds fluctuate with changes in market conditions. Shares, when sold, may be worth more or less than their original cost. Investments seeking to achieve higher returns also involve a higher degree of risk. Mutual funds are sold by prospectus. Please consider the investment objectives, risks, charges, and expenses carefully before investing. The prospectus, which contains this and other information about the investment company, can be obtained from your financial professional. Be sure to read the prospectus carefully before deciding whether to invest.
Aka: – an abbreviation of ‘also known as’. Some people may be known more by a nickname or some other name than by the official one on their birth certificate. It is a good idea for those people to state this in addition to their proper name, when making their will.
Alias: – see
ALIEN, TAX TREATMENT OF: -- A person who is not a citizen of the country in which he or she lives. In general, most countries do not distinguish between nationals and aliens for tax purposes; rather tax liability is based on residence and/or domicile.
ALIENATION OF INCOME: -- Term generally used to describe the transfer of the right to receive income from a source while not necessarily transferring the ownership of that source to the same person.
Alignment: The positioning of the human capital system's policies, practices, and strategies in relationship to the agency's strategic plan and performance plan, so what is done in the system is in direct support of the agency's mission, goals, and objectives.
ALLOCATION: -- The apportionment or assignment of income or expense for various tax purpose, e.g., between permanent establishments in various jurisdictions
ALLOWANCE: -- Deduction or exemptions generally made in computing income taxes, inheritance and gift taxes and some forms of sales taxes.
Alternate valuation date: – A date exactly six months following the decedent’s date of death by which the personal representative may choose to revalue, for estate tax purposes, all assets held by the estate.
Alternative assets: A general term to describe non-traditional types of asset class, including private equity.
Alternative Minimum Tax: A method of calculating income tax that disallows certain deductions, credits, and exclusions. This was intended to ensure that individuals, trusts, and estates that benefit from tax preferences do not escape all federal income tax liability. People must calculate their taxes both ways and pay the greater of the two.
Alternative Minimum Tax (AMT): A method of calculating income tax with a unique set of rules for deductions and exemptions that are more restrictive than those in the traditional tax system. The AMT attempts to ensure that certain high-income taxpayers don’t pay a lower effective tax rate than everyone else. To determine whether or not the AMT applies, taxpayers must fill out IRS Form 6251.
Ambulatory: – often used in referring to the nature of wills, because a will may be changed or cancelled at any time up until the willmaker dies, it does not have legal effect or force until the willmaker’s death.
AMORTIZATION: -- Process of writing off the cost of an intangible asset over its useful life.
AMORTIZATION METHOD: -- Method of computing a credit under a VAT regime where investment goods are purchased which have a useful life in the business for a period exceeding one year. The tax embodied in the price paid for the assets may be credited to the trader over a period of years corresponding to the life of the assets.
Analysis: is the breaking up and examining of parts of a whole. In workplace learning and performance, analysis is the process of determining the following:• Gap, which identifies the discrepancy between the desired and actual knowledge, skills, and performance, and specifies root causes.• Job, which identifies learners’ workplace duties and responsibilities, and tasks done on a daily, weekly, monthly, or yearly basis.• Needs is the process of collecting and synthesizing data to identify how training can help an organization reach its goals.• Task is the process of identifying the specific steps that need to be taken to correctly perform a job function.
Ancillary probate –: Type of probate if decedent had real property in another state.
and Certification of Training: Governmentwide training form used to request, approve, and certify completion of training courses, conference, seminars, symposia and academic courses. It primary purpose is to document and track employee traininig, especially training paid with agency funds.
And others: Other diligence projects that also run in parallel include IT Due Diligence, Management Due Diligence Sales Due Diligence and Insurance Due Diligence. They are normally thought of as the second level of diligence projects – less important. They cost less and the corresponding report tends to be poorer and significantly less useful.Quite often all of these diligence projects run concurrently and the PE firm is also still doing their own work as well. Everyone is working quickly trying to complete the deal by a deadline so you and your team will be under a barrage of questions every day. That’s why PE processes are exhausting and hugely distracting to the management team. See post-deal slump.
Andragogy: (from the Greek meaning adult learning) is the method and practice of teaching adults. It was advanced by Malcolm Knowles, whose theory outlines five key principles of adult learning: self-concept, prior experience, readiness to learn, orientation to learning, and motivation to learn.
Annex, annexe: – to attach, add or append. For example in the Probate Registry of the Supreme Court of NSW documents are required to be attached by stapling together in the top left hand corner.
Annual exclusion –: The inflation-indexed annual amount that can be given to any individual or any number of individuals gift-tax-free. For calendar year 2017 the amount is $14,000.
Annual Percentage Rate (APR): The yearly cost of a loan expressed as a percentage of the loan amount. The APR includes interest owed and any fees or additional costs associated with the agreement.
Annual Report: A report required by the Securities and Exchange Commission (SEC) of any company issuing registered stock, that describes a company’s management, operations, and financial reports. Annual reports are sent to shareholders, and must also be available for public review.
Annual Strategy Presentation: Some PE firms like you to come and do an Annual Strategy Presentation where you give the Investment Committee an update on what you’re doing and outline what the year ahead looks like.In my experience these are done very patchily and in nine PE years I’ve only actually done two. In my research for the first one I couldn’t find any commonality of approach from anyone who had done one before.They seem to have three key purposes :Let’s the investment committee have a look at you and see if their Investment Director is holding anything back from them (for example that you’ve lost your mind).Let’s them interact through a couple of well meaning suggestions or “challenges”, which generally reveal how little they know about your business and what you’re strugglng with.Let’s them tell their LP’s that it’s one of the many ways that they add value to their investments.These presentations are definitely not something to worry about. But if you’re running a process and one of your PE bidders says they don’t do them, give them a bonus point in your assessment grid.
Annuity: A contract with an insurance company that guarantees current or future payments in exchange for a premium or series of premiums. The interest earned on an annuity contract is not taxable until the funds are paid out or withdrawn. Withdrawals and income payments are taxed as ordinary income. If a withdrawal is made prior to age 59½, penalties may apply. The guarantees of an annuity contract depend on the issuing company’s claims-paying ability. Annuities have fees and charges associated with the contract, and a surrender charge also may apply if the contract owner elects to give up the annuity before certain time-period conditions are satisfied.
Annuity –: A contract in which a given sum of money is paid to a beneficiary on a periodic basis for a specified time.
AOEs: (Areas of Expertise) are the specific technical and professional skills and knowledge mastery areas for success in the WLP profession.
APA: -- See: Advance Pricing Arrangement
APPORTIONMENT METHOD: -- One of the methods used to allocate income and expenses between related enterprises using a formula consisted of some factors such as sales, property, or payroll.
Appraisal: A formal assessment of a property’s value at a specific point in time, performed by a qualified professional.
Appraised value or appraisal –: An estimation of the value of property by disinterested people having certain qualifications and specific methodologies.
Appreciative Inquiry: (AI) Theory is an approach to large-scale organizational change that involves the analysis of positive and successful (rather than negative or failing) operations. The AI four-D cycle (discovery, dream, design, destiny) includes identifying problems, analyzing causes, searching for solutions, and developing an action plan.
Aptitude: Aptitude refers to a person’s natural ability to do something. Recruitingtalented individuals with high aptitude in the right areas is key for1businesses looking to gain a competitive advantage over theircompetitors.
Aptitude Test: Explore an individual’s ability to perform or carry out different tasks.These tests tend to have a formal, structured approach where candidates’answer multiple choice questions under exam conditions so that it can beadministered and scored to ensure results can be compared.
ARBITRAGE: -- Process of buying a commodity (which may include currency or securities) and simultaneously selling it in another market in order to profit from price differentials.
ARBITRAGE, TAX: -- Process of entering into a tax motivated transaction (i.e. to obtain profit from the application of tax rules).
ARBITRATION: -- Term used for the determination of a dispute by the judgment of one or more persons, called arbitrators, who are chosen by the parties and who normally do not belong to a normal court of competent jurisdiction
Area of Responsibility: The area of the organization structure for which a TMS can perform Talent Management activities
ARM'S LENGTH PRINCIPLE: -- The international standard which states that, where conditions between related enterprises are different from those between independent enterprises, profits which have accrued by reason of those conditions may be included in the profits of that enterprise and taxed accordingly
ARM'S LENGTH RANGE: -- A term used in transfer pricing to describe a range of values that can be defined for purpose of selecting an appropriate arm's length price from comparable transactions.
ARM'S LENGTH TRANSACTION: -- A transaction among parties, each of whom acts in his or her own best interest.
Artificial Intelligence (AI): is typically defined as the ability of a machine to simulate human cognitive processes, such as perceiving, reasoning, learning, interacting with the environment, problem solving, and creativity.
ASSESSMENT: -- Act of computing the tax due
Assessment Tool: A device or method used to measure the degree to which an applicant possesses the competencies or KSAs necessary for successful job performance. Examples of assessment tools include rating schedules, written tests, work samples, and structured interviews.
Asset: Anything owned that has a current value that may provide a future benefit.
Asset Allocation: A method of allocating funds to pursue the highest potential return at a specific level of risk. Asset allocation normally uses sophisticated mathematical analysis of the historical performance of asset classes to attempt to project future risk and return. Asset allocation is an approach to help manage investment risk. It does not guarantee against investment loss.
Asset Class: A given category of investment, such as U.S. stocks, international stocks, U.S. bonds, international bonds, real estate, commodities, or cash.
Asset Class Diversification: Having a mixture of at least five and preferably eight or nine asset classes in an investment portfolio.
Asset Management: Professional management of both securities (such as stocks, bonds, limited partnerships, and mutual funds) and tangible assets like real estate to meet specified investment goals for the benefit of an investor.
Asset Protection: Strategies that go beyond liability insurance, using a set of legal techniques and statutory laws to protect wealth against liability and frivolous lawsuits. Learn more about asset protection.
ASSET PROTECTION FROM LAWSUITS & CREDITORS: In today’s litigious society, many people are concerned about the risk of lawsuits. Good asset protection can help protect your hard earned assets from frivolous lawsuits. This is especially important for family businesses or professional practices.
Assets –: All types of property.
Associate Professional in Talent Development (APTD): is a certification for talent development professionals who are in the early part of their careers or whose professional roles and aspirations are focused on a few areas of expertise. The capabilities included in the APTD are the basics of talent development that professionals can use every day, no matter the level within an organization or company. It may be a destination for some or a stepping stone to the CPTD for others.
ASSOCIATED ENTERPRISES: -- Generally speaking, enterprises are associated where the same persons participate directly or independently in the management, control or capital of both enterprises, i.e. both enterprises are under common control.
Asynchronous Learning: is : ‘as trustee for’.
Attest and attestation: to bear witness to the genuineness or authenticity of a document by signing as witness, to authenticate a document.
Attesting witness: – A person who sees the will-maker sign his or her will document, and then signs the same document themselves as proof that it was signed in their presence. Having done this, they can then declare or attest that they witnessed the will-maker sign their own will.
Attitude: An individual’s attitude will often be linked with their outlook andpersonality. Key indicators of an individual’s attitude are the way thatthey communicate with people and their body language or posture.Attitude Test Examine individual’s preferences for different types of work, as well astheir opinions, attitudes and behaviour towards others. Thesecharacteristics are usually assessed using a questionnaire without a timelimit. The results are then interpreted by an assessor trained to ensureinterpretation and feedback is accurate.
Attorney: – is a person who has been appointed by someone else to make certain decisions in their place.
Atwhen the trainer and the learner do not participate simultaneously in time or location; for example, asynchronous e-learning.
ATF –torney –: Another term for lawyer.Basis – The value of an asset for the purpose of determining the gain or loss on its sale or transfer. It is generally the purchase price of an asset plus related costs of purchasing the asset less allowable depreciation and insurance reimbursements for casualty and theft losses. If the property is transferred to a donee (gift recipient), the donor’s basisusually becomes the donee’s basis.
ATTRIBUTION RULES: -- Rules that create ownership by attributing stock to one party even though the shares are legally owned by another party; often called constructive ownership of stock.
Auction: A public sale in which the vendor publishes intention to sell a business/asset by a specific date, which in turn generates an auction process. The business is then usually sold to the highest bidder.
Audit: In accounting, the formal examination of a company’s financial records by a qualified professional to determine the records’ accuracy, consistency, and conformity to legal standards and established accounting principles. In taxes, the formal examination of a tax return by the Internal Revenue Service or other authority to determine its accuracy.
Authoring Tools: are software programs that allow a content expert to interact with a computer in everyday language to develop courseware.
Authoring Tools or Instructional Tools: Software packages instructional designers use to create and package content to end users. Authoring tools are commonly used to create e-learning modules. They are written to conform to international standards such as Shareable Content Object Reference Model (SCORM). These tools allow for Common authoring tools are Adobe Captivate, Adobe Flash, and Articulate.
Authorization, Agreement, and Certification of Training" (SF-182): Governmentwide training form used to request, approve, and certify completion of training courses, conference, seminars, symposia and academic courses. It primary purpose is to document and track employee traininig, especially training paid with agency funds.
Automatic Reinvestment: An arrangement under which an institution automatically deposits dividends or capital gains generated by an individual’s investment back into the investment to purchase additional shares.
AUXILIARY ACTIVITIES: -- A fixed place of business through which an enterprise exercises solely an activity which has, for the enterprise, a preparatory or auxiliary character, is, under tax treaties generally, deemed not to be a permanent establishment. The decisive criterion is whether the activity of the fixed place of business in itself forms an essential and significant part of the activity of the enterprise as a whole.
AUXILIARY COMPANY: -- Company which is part of a group of companies and which supplies auxiliary services to group companies.
AVOIDANCE: -- A term that is difficult to define but which is generally used to describe the arrangement of a taxpayer's affairs that is intended to reduce his tax liability and that although the arrangement could be strictly legal it is usually in contradiction with the intent of the law it purports to follow. Cf. evasion
Succession Planning: B
BACK-TO-BACK LOAN: -- Method of borrowing between related parties where a loan is channelled through an independent third-party intermediary.
BAD DEBT: -- Debt which is unlikely to be paid. Bad debts may usually be treated as losses and written off against a reserve for such debts.
BALANCE SHEET: -- Statement of the financial position of a business as of a particular date. The statement will show the business's assets in one column and its liabilities and owner's equity in another column.
Balanced Mutual Fund: A mutual fund whose objective is a balance of stocks and bonds. Balanced funds tend to be less volatile than stock-only funds. The return and principal value of mutual funds fluctuate with changes in market conditions. Shares, when sold, may be worth more or less than their original cost. Mutual funds are sold by prospectus. Please consider the investment objectives, risks, charges, and expenses carefully before investing. The prospectus, which contains this and other information about the investment company, can be obtained from your financial professional. Be sure to read the prospectus carefully before deciding whether to invest.
Balanced Scorecard Approach: is a strategic planning and management system for measuring and tracking an organization's performance through four perspectives: the customer, learning and growth (or innovation), internal business processes, and financial.
BALANCING PAYMENT: -- A payment, normally from one or more participants to another, to adjust participants’ proportionate shares of contributions, that increases the value of the contributions of the payer and decreases the value of the contributions of the payee by the amount of the payment, in the context of CCA (Cost Contribution Arrangements).
BANK SECRECY PROVISIONS: -- Provisions which require that a bank refuse to disclose information about its customers to third parties, including the tax authorities.
BAPA: -- Bilateral advance pricing arrangement. Also called MAP APA.
BASE COMPANY: -- Company situated in a low-tax or non-tax country (i.e. tax haven), which is used to shelter income and reduce taxes in the taxpayer's home country. Base companies carry on certain activities on behalf of related companies in high-tax countries (e.g. management services) or are used to channel certain income, such as dividends, interest, royalties and fees.
BASE COST: -- Term used in capital gains tax legislation to denote the cost of an asset to an owner.
Bear Market: A market experiencing an extended period of declining prices. A bear market is the opposite of a bull market.
BEARER SECURITIES: -- Stocks, bonds, etc. in which ownership can be transferred from one holder to another without registration of the transaction by the issuing company, that is, title passes with delivery.
Behavioral Career Counseling: is a scientifically precise approach to career decision making that leverages concepts from psychology.
Behaviorism: is a learning theory focused on observable and measurable behavior. It is usually associated with psychologist B.F. Skinner, who predicted that animal and human behavior occurs through conditioning, which is the reinforcement of desired responses.
Bench Strength: A risk-based score to measure the strength of the successors assigned to a position
Benchmarking: An organization change process directed toward continuous improvement. A benchmark is a comparative standard for evaluating accomplishments against known exemplars of excellence. It is a targeted goal beyond current capabilities, but for which the organization is striving. It is a search for best practices among recognized leaders who sustain superior performance and is focused on analyzing what the superior organization did to improve that could be applied in other places.
BENEFICIAL OWNER: -- A person who enjoys the real benefits of ownership, even though the title to the property is in another name. Often important in tax treaties, as a resident of a tax treaty partner may be denied the benefits of certain reduced withholding tax rates if the beneficial owner of the dividends etc is resident of a third country.
Beneficiary: A person named in a life insurance policy, annuity, will, trust, or other agreement to receive a financial benefit upon the death of the owner. A beneficiary can be an individual, company, organization, and so on.
Beneficiary –: A person named in a will to receive certain property of the testator. Also, a person who receives income or assets from a trust.
Beneficiary Designations.: These are contracts between you and some entity, often your employer (for work benefits), an insurance company or a financial institution. These allow you direct payment of the assets held by the entity directly to your named beneficiary, thereby avoiding probate (but not estate taxes).
Beneficiary.: A person designated to receive the income, principal, or proceeds of a trust, estate, financial account, insurance policy, or retirement plan.
BENEFIT TEST: -- In considering whether a company may be allowed to deduct, as an expense, payments made to a related company in a multinational group on account of expenses incurred by that related company in providing intra-group services, tax authorities would refuse a deduction unless a real benefit had been conferred on the company claiming the deduction.
BENEFITS IN KIND: -- Term which refers to earnings, usually from employment, other than in cash, as part of compensation for services rendered.
Bequest –: a gift made by will, usually of money, also referred to as a
Bequest A: s: set or assets passed to an heir or heirs by action of a will (to bequeath is the act of passing assets by action of a will).
BERRY RATIO: -- Ratio used to establish an arm's length profit. The Berry ratio is the ratio of a business' gross income to operating costs.
BEST METHOD RULE: -- Transfer pricing rule requiring that a taxpayer use the transfer pricing method that results in the most reliable measure of an arm's length price. This rule doesn't prescribe priorities between various methods.
Best Practice: An innovative and creative human resource (HR) practice, project, activity, or program that facilitates achievement of the organization's mission. The relationship between the practice and its applicability to enhancing the mission is clear, and the practice is easily replicated by other organizations with similar circumstances. Best practices may be considered to be tested solutions to common business challenges.
BILATERAL ADVANCE PRICING ARRANGEMENT (BAPA) APA: -- involving two or more tax authorities
Bill of Sale: A document recording the transfer of personal property.
BIMBO – Buy In, Management Buyout: A BIMBO deal is where a sale includes elements of both an MBI and an MBO. For example an incumbent management team working with an external candidate to buy the company from the vendor, forming a new management team in the process.
Blended Learning: is the practice of using several media in one curriculum. It refers to the combination of formal and informal learning events, such as classroom instruction, online resources, and on-the-job coaching.
Blended Training: Training that requires two or more methods of delivery that must be completed in order to satisfy the educationl requirements.
Blog: A website which allows an author to share opinions, reflections, and discuss topics in the form of online journals. Learning and development programs can incorporate blogs to provide supplemental course information and updates on course materials. Participants can discuss the course in this space.
Bloom's Taxonomy: developed by Benjamin Bloom, is a hierarchical model used to classify learning into three outcomes or domains—cognitive (knowledge), psychomotor (skills), and affective (attitude)—referred to as KSAs. The domain categories use verbs to define behavior in a hierarchical relationship that becomes progressively more complex and difficult to achieve. The taxonomy is useful for writing learning objectives.
Blue Chip Stock: The stock of an established company which has a history of generating a profit and possibly a consistent dividend.
Bona vacantia: – Latin term meaning there is no owner for the property. This situation arises when someone dies without a will, and there is no-one in the class of persons as defined by the law, who can take the deceased’s property. When this happens, the law provides for the respective state or territory government to be entitled to take the deceased estate’s property.
Bond: A debt instrument under which the issuer promises to pay a specified amount of interest and to repay the principal at maturity. The market value of a bond will fluctuate with changes in interest rates. As rates rise, the value of existing bonds typically falls. If an investor sells a bond before maturity, it may be worth more or less than the initial purchase price. By holding a bond to maturity, an investor will receive the interest payments due plus his or her original principal, barring default by the issuer. Investments seeking to achieve higher yields also involve a higher degree of risk.
Bonds: Investments through which one loans money to a corporation or government.
Book Value: The net value of a company's assets, less its liabilities and the liquidation price of its preferred issues. The net asset value divided by the number of shares of common stock outstanding equals the book value per share, which may be higher or lower than the stock's market value.
BRACKETS: -- Term used in connection with graduated system of taxation to refer, for example, to the slabs or slices of taxable income subject to particular rates of income tax.
BRANCH: -- Division, office or other unit of business located at a different location from the main office or headquarters. It is not a separate legal entity.
BRANCH PROFITS TAX (BPT): -- See: Branch tax
BRANCH TAX: -- Tax imposed on branches of foreign companies in addition to the normal corporate income tax on the branch's income. This is equivalent to the tax on dividends which would be due if the branch had been a subsidiary (see: subsidiary company) of the foreign company and had distributed its profit as dividends.
BROTHER-SISTER CORPORATIONS: -- Two or more companies which are owned and controlled by the same shareholders.
Bull Market: A market experiencing an extended period of rising prices. A bull market is the opposite of a bear market.
BURDEN OF PROOF: -- Obligation to persuade a court or other entity of the validity of a factual assertion.
BUSINESS ASSETS: -- Assets used for purposes of carrying on a business
Business Case: A method for projecting and documenting the benefits to be gained as a result of investing resources in a given strategy. A business case typically provides a cost/benefit analysis, information on return on investment over time, etc. Business cases tell agencies about the likely consequences of certain actions.
Business Culture: The shared attitudes, values and goals within an organisation. Anorganisations business culture will determine how staff communicateswith one another as well as how they deal with clients and customers.
Business Forecasting: Determining future workforce needs by assessing anticipated changes in demographic trends, mission or program changes, external mandates, cyclical workload factors, job evolution, new technology and/or work processes, budget constraints or growth, new organizational designs, etc.
Business Insight: is the understanding of key factors affecting a business, such as its current situation, influences from its industry or market, and factors influencing growth. It also includes understanding how an organization accomplishes its mission or purpose, makes and spends money, and makes decisions, as well as the internal processes and structures of how work gets done.
Business plan –: A written document that describes a business’s product concept, potential customers, and necessary financial resources needed to achieve the objectives of the business.
Business Strategy: An organisations strategy shows what the organisation wants to achieveand how it will achieve it. It includes the purpose of the organisation,goals and objectives followed by plans and methods of achieving theseobjectives.
Business Succession Plan: Developing a Business Succession Plan is crucial to ensuring the ongoing viability of your business, regardless of whether you leave your business through retirement, sale or death. Having a plan in place helps ensure a smooth transition for you, your family, your employees, and your business. Business Succession planning is often done in concert with creating an Estate Plan.
BUSINESS SUCCESSION PLANNING: Most small businesses will not survive an intergenerational transfer. If you’ve spent years of your life building a successful business, doesn’t it make sense to be a wise steward in successfully passing on the legacy of that business? Proper planning can help your business survive to the next generation. Stewardship Advisory Group can show you the way.
Buy and Build: An acquisition forming part of a private equity firms strategy to consolidate a particular industry sector by buying a number of different companies and merging them. A portfolio company of the private equity firm normally makes the acquisition, although in some cases, mainly for tax reasons, the acquisition can be executed using a new company specifically created for the transaction. A buy and build strategy can be identified from the press release of the deal, if there is a statement that the private equity firm plans to bolt/merge the acquisition with another one of its portfolio companies.
Buy/sell agreements –: Formal agreements that spell out terms of ownership transfers in case of death, divorce, disability, and dissolution. They include information on valuation, discounts and any restrictions on asset transfers.
Buy-and-Hold: An investment strategy that advocates holding securities for the long term and ignoring short-term price fluctuations in the market.
Buy-In MBO (Buy In Management Buy Out): The acquisition of a company by a venture capitalist or private equity investor in which the management of the acquired company is supplemented by an outside management team brought in by the acquirer.
BUY-IN PAYMENT --: A payment made by a new entrant to an already active CCA (Cost Contribution Arrangements) for obtaining an interest in any results of prior CCA activity.
Buyout: Any investment where a company or subsidiary is acquired from its shareholders. See also ‘management buyout’ and ‘secondary buyout’.
BUY-OUT PAYMENT: -- Compensation that a participant who withdraws from an already active CCA may receive from the remaining participants for an effective transfer of its interests in the results of past CCA activities.
Buy-Sell Agreement: A Buy-Sell Agreement controls what happens if one of the business owners leaves the company for any reason, including death, disability, disagreement (business divorce), or retirement. Important issues such as valuation of a Member’s interest, payout schedule, and rights of first refusal are just some of the aspects covered by this document. By addressing these issues in advance, a Buy-Sell Agreement helps owners avoid contentious and/or lengthy negotiations and potential litigation.
Succession Planning: C
CALL OPTION --: Contract under which the holder of the option has the right but not the obligation to purchase securities or commodities on or before a specified date for a specified exercise price.
Candidate: In a succession plan, a person identified to fill a job or position or replace a named incumbent.
Candidate Relationship Management: This is the process of retaining information about strong candidates readyfor when other vacancies open up. Sometimes you may have many goodapplications for a role but feel that some candidates would suit otherroles better. By keeping in touch with them you are giving yourself thechance in the future to recruit quickly, efficiently and cost effectively.
CAPITAL ASSETS: -- All property held for investment by a taxpayer.
CAPITAL EXPENDITURE --: Expenditure on improvement rather than repair. Where expenditure is more closely connected with the business income-earning structure than its income earning capacity, it is capital expenditure.
CAPITAL GAIN: -- A gain on the sale of capital asset.
Capital Gain or Loss: The difference between the price at which an asset was purchased and the price for which it was sold. When the sale price is higher than the purchase price, the difference is a capital gain; when the sale price is lower than the purchase price, the difference is a capital loss.
Capital gains: The difference between an asset’s purchase and sale price, where the sale price is higher. Capital gains are taxed at a lower rate than other forms of income.
CAPITAL LOSS --: The loss from the sale of a capital asset.
CAPITAL TAX --: A tax based on capital holdings, as opposed to a capital gains tax.
Capitalization: The size of a company whose stock an investor might own, described as large-cap, mid-cap, and small-cap.
CAPITALIZE: -- To record capital outlays as additions to asset accounts, not as expenses.
CAPTIVE BANK: -- Wholly owned subsidiary of a multinational group of companies whose purpose is to provide banking service to the group and those with whom the group deals. A captive bank is generally located in a tax haven in order to avail itself of the low capital requirements and freedom from exchange control.
Captive fund: A venture capital or private equity investor which is owned by a larger financial institution, such as a bank.
CAPTIVE INSURANCE COMPANY --: Wholly owned subsidiary of a multinational group of companies which exclusively insures or reinsures the risks of companies that belong to the group. A captive insurance company is usually established in a low-tax country. Whether premiums paid to captive insurance companies are recognized as business expenses depends on the country in question.
Career: A person’s career is the sequence and variety of occupations they haveundertaken throughout their life-time. In the workplace for a role to beseen as a career there tends to be some form of job progression alongwith special training of formal education.
Career Adaptability: Adaptability is a prerequisite for successful navigation through careertransitions. Career adaptability can be broken down into the 4C’s,Concern, you care about preparing for the future, Control, takeresponsibility for building your own career, Curiosity, taking the initiativein exploring new pathways and Confidence, it takes confidence to adaptand solve complex problems.
Career Advising: is professional guidance for making vocation and occupation decisions. It may include outlining required development options.
Career Aspirations: These are a person’s aims or goals in their career. You can tell how driven,lazy, realistic or unrealistic people are by the aspirations that they hold.
Career Development: is a planned process of interaction between an organization and an individual that allows the employee to grow within the organization.
Career Planning: The process of career planning is generally regarded as a four stepprocess. Self, gather information about yourself. Options, explore andresearch the options you are interested in. Match, identify and evaluatethe possible occupations. Action, develop the steps to achieve the targetyou have set yourself.
Career Progression: Refers to the upward movement or advancement of people in anorganisation. Typically, only the highest performing talented individualscan progress to the very top as most people’s talent levels restrict how farthey can progress.
Career Type/Level: Type and level of career aspiration, used to measure the career aspirations of employees and the career aspiration requirement of jobs or positions
CARRYOVER: -- A process by which the deductions or credits of one taxable year that cannot be used to reduce tax liability in that year are applied against a tax liability in subsequent years (carryforward) or previous years (carryback).
Carve Out: A corporate carve out enables a business to split away from its parent company, freeing up its management team and allowing them to move in a new direction. Often, a private equity firm will work directly with the existing management team to buy the business and help take it forward. Read more.
Case Study: is a learning method in which a real or fictitious situation is presented for analysis and problem solving.
Cash Alternatives: Assets that are most easily converted into cash and which have a very low risk of price fluctuation. For example, money market funds may be considered a cash alternative. Money held in money market funds is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Money market funds seek to preserve the value of your investment at $1.00 a share. However, it is possible to lose money by investing in a money market fund.
CASH BASIS (CASH METHOD) --: The accounting method which recognizes income and deductions when money is received or paid.
Cash Surrender Value: The amount that an insurance policyholder is entitled to receive when he or she discontinues coverage. Policyholders are usually able to borrow against the surrender value of a policy from the insurance company. Policy loans that are not repaid will reduce the policy's death benefit and cash value by the amount of any outstanding loan balance plus interest.
CCA --: See: Cost Contribution Arrangements
CENTRAL MANAGEMENT AND CONTROL --: Where the central management and control is located is a test for establishing the place of residence of a company. Broadly speaking, it refers to the highest level of control of the business of a company.
CENTRE OF VITAL INTEREST --: This is one of the criteria used to resolve the problem of dual residence of individuals. It refers to the place where the taxpayer's personal and economic relationships are closer.
Certificate of Deposit (CD): A deposit with a bank, thrift institution, or credit union that promises a fixed interest rate on funds deposited for a specified period of time. Bank savings accounts and CDs are FDIC insured up to $250,000 per depositor per institution and generally provide a fixed rate of return, whereas the value of money market mutual funds can fluctuate.
Certificate Program: A training program established or purchased by an agency to provide structured training course(s) to employees to meet an indentified performance and developmental need.
Certification: is a process for increasing technical competencies through studies, testing, and practical application while also working toward a recognized designation.
Certification Program: Involves a process in which individuals attain and demonstrate the level of knowledge and skill required to perform in the profession.
Certified Commercial Investment Manager (CCIM®): Certified Commercial Investment Manager (CCIM®) is a certification obtained by experts in the area of commercial and investment real estate. The education required to obtain the CCIM includes: financial analysis, market analysis, user decision analysis, and investment analysis. After completing the required course work, candidates must submit a portfolio proving their in-depth knowledge and experience in the commercial investment field. Candidates must then pass a comprehensive, six-hour exam administered by the CCIM® institute. Currently only 6% of commercial real estate practitioners hold this designation, which reflects on the caliber of the program, as well as why it is a highly coveted and respected designation.
Certified Financial Planner (CFP®): A designation conferred by the Certified Financial Planner Board of Standards. A CFP® has received approved training and industry certification in the six areas of financial planning: estate planning, retirement planning, cash flow management, risk management, tax planning, and investments.To become a Certified Financial Planner® (CFP®), an applicant must complete and commit to four E’s: Education, Examination, Experience, and Ethics.All CFP® candidates are required to have bachelor’s degrees and to complete a CFP® Board-Registered education program covering the major areas of comprehensive financial planning, including Financial Planning Fundamentals, Investments, Retirement, Taxation, Estate, and College Planning. The planner must then take a 10-hour examination on over 80 financial planning topics. The pass rate for this exam averages between 50% and 60%. After passing the exam, planners must spend three years gaining full-time work experience to insure they know how to apply their knowledge.Certified Financial Planners® must sign an ethics code that discloses any previous criminal charges. They must also adhere to the CFP® Board’s Code of Ethics and Professional Responsibility and Financial Planning Practice Standards. This requires adherence to a fiduciary standard, which means making a commitment to always act in the best interests of their clients. This is a crucial difference between CFP®’s and many other financial professionals, who may be primarily sellers of financial products whose loyalty is to the companies they represent.To maintain the CFP® designation, planners must complete 30 hours of Continuing Education every two years, including two hours specifically on ethics.
CERTIFIED FINANCIAL PLANNER® Practitioner: A credential granted by the Certified Financial Planner Board of Standards, Inc. (Denver, CO) to individuals who complete a comprehensive curriculum in financial planning and ethics. CFP®, CERTIFIED FINANCIAL PLANNER® and federally registered CFP (with flame logo)® are certification marks owned by the Certified Financial Planner Board of Standards. These marks are awarded to individuals who successfully complete the CFP Board's initial and ongoing certification.
Certified Professional in Talent Development (CPTD): is a professional certification for TD professionals with at least five years of experience. It is broad and measures a professional’s knowledge and skill application across the breadth of talent development capabilities.
Certified Public Accountant (CPA): A professional license granted by a state board of accountancy to an individual who has passed the Uniform CPA Examination (administered by the American Institute of Certified Public Accountants) and has fulfilled that state's educational and professional experience requirements for certification.
ChaChar401(k): An employer-sponsored retirement plan. Employee contributions are taken out before withholding taxes are computed, and many employers offer matching contributions.
Change Agent: is any person or group responsible for initiating or implementing organizational change. It is also a person who understands organizational and personal change dynamics and seeks to affect a different condition in an organization.
Change Management: is the process for enabling change within an organization by using structured approaches to shift individuals, teams, and organizations from a current state to a future state. It is considered an organizational capability in ATD’s Capability Model.
Charitable Lead Trust: A trust established for the benefit of a charitable organization under which the charitable organization receives payment of a specified amount (at least annually) from the trust. On the death of the grantor, remainder interest in the trust passes to his or her heirs. Using a trust involves a complex set of tax rules and regulations. Before moving forward with a trust, consider working with a professional who is familiar with the rules and regulations.
Charitable Remainder Trust: A trust established for the benefit of a charitable organization under which the grantor can designate an income beneficiary to receive payment of a specified amount—at least annually—from the trust. The grantor may also be the income beneficiary. On the death of the grantor, remainder interest in the trust passes to the charitable organization. Using a trust involves a complex set of tax rules and regulations. Before moving forward with a trust, consider working with a professional who is familiar with the rules and regulations.
Charitable Trust.: A trust having a charitable organization as a life-time beneficiary (Charitable Lead Trust) or a death beneficiary (Charitable Remainder Trust).
Chartered Financial Consultant (ChFC): A professional financial planning designation granted by The American College (Bryn Mawr, PA) to individuals who complete a comprehensive curriculum in financial planning. Prerequisites include passing a series of written examinations, meeting specified experience requirements and maintaining ethical standards. The curriculum encompasses wealth accumulation, risk management, income taxation, planning for retirement needs, investments, estate and succession planning.
Chartered Financial Consultant® (ChFC®): The Chartered Financial Consultant® (ChFC®) designation is a program to certify planners in Advanced Financial Planning. The requirements are similar to those for the CFP®, except they also include additional course work in financial planning. Planners must also pass an examination, obtain three years of work experience, sign a code of ethics, and obtain 30 hours of CE credit every two years.
Chartered Life Underwriter (CLU): A professional designation granted by The American College to individuals who complete a comprehensive curriculum focused primarily on risk management. Prerequisites include passing a series of written examinations, meeting specified experience requirements, and maintaining ethical standards. The curriculum encompasses insurance and financial planning, income taxation, individual life insurance, life insurance law, estate and succession planning, and planning for business owners and professionals.
Chattel –: An article of personal property (personal and movable). An example is machinery and equipment.
CHERRY PICKING --: Term used in the USA in R&D arrangements to prevent a contracting party from selecting or funding only the technologies that are successfully developed, i.e. "cherry picking". In transfer pricing context, it often describes a situation where a tax authority tries to impose a TP adjustment on a taxpayer based on a few of “cherry picked” related party transactions of other comparable companies with an intention to maximize its adjustment.
child: (or an
CIF VALUE --: The value of imported goods which includes cost, insurance and freight.
CIVIL LAW --: Systems of law based primarily on statutes or codes rather than judicial decisions. Examples are the French and German systems.
Claim: A request for payment under the terms of an insurance policy.
clear: —choosing audience-appropriate words that are precise and descriptive·
CLOSE (CLOSELY HELD) COMPANY --: Company which is owned or controlled by a single shareholder or closely knit group of shareholders.
Closely held business –: A business organization in which the ownership is held by a limited number of people, often the same family, rather than owned by the public at large.
Cloud Computing: is a model for enabling shared network access of computing resources. It is a concept still in the early stages of development, and its definition and potential effects are still evolving. It is the driver of an important shift in information technology, one that will affect everyone who uses computing and telecommunications technology.
Coach: Simply defined, coaching is the process of one person guiding anotherthrough a process. Often, a more senior member of staff will be assignedto a younger less experienced employee in order to assist in theirpersonal development.
Coaching: is a widely used term with multiple definitions. The International Coach Federation defines coaching as "a professional partnership between a qualified coach and an individual or team that supports the achievement of extraordinary results, based on goals set by the individual or team. Through the process of coaching, individuals focus on the skills and actions needed to successfully produce their personally relevant results.” It is not counseling, mentoring, training, or giving advice. Coaching may also be used on the job, when a more experienced person, often a supervisor, provides constructive advice and feedback to develop or improve an employee’s performance.
COACHING PROCESS: The Life Stewardship™ Coaching process will guide you as you create a legacy that will last for eternity.
COBRA: The Consolidated Omnibus Budget Reconciliation Act is a federal law requiring employers with more than 20 employees to offer terminated or retired employees the opportunity to continue their health insurance coverage for 18 months at the employee's expense. Coverage may be extended to the employee's dependents for 36 months in the case of divorce or death of the employee.
Codicil –: A supplement, amendment, or addition to a will executed with all the formalities of the will itself. It may explain, modify, add to, subtract from, qualify, alter or revoke provisions in a will.
co-executors: , or a trustee corporation or public trustee permitted to offer trustee services.
Co-executors –: when more than one person has been appointed by a willmaker to administer their estate.
Cognition: is the mental process of acquiring knowledge and understanding through the five senses, thought, and experience. The word dates back to the 15th century, meaning thinking and awareness.
coherent—: maintaining consistency, selecting simple sentence structures, and presenting in an easy to follow order·
Coinsurance or Co-Payment: A policy provision under which an insurance company and the insured party share the total cost of covered medical services after the policy’s deductible has been met.
Collaboration: is behavior in which two or more individuals work together toward a common goal with equal opportunity to participate, communicate, and be involved. During conflict it is when both parties work together to develop a win-win solution.
Collaborative Learning: is an instructional approach in which two or more learners work together to discover, learn, solve problems, and share information either in person or online. It may be used by facilitators to encourage engagement and involvement.
COLLEGE EDUCATION PLANNING: Your children or grandchildren may still be in diapers, but it is never too soon to begin planning for their education. How much do we need to invest? What type of investments should we use to fund education? Stewardship’s team will help find the best plan for you and your family.
COMMENSURATE WITH INCOME STANDARD --: See: Super royalty provision
Commercial Diligence: This is a report written by management consultants on the commercial aspects of your business. They will analyse and explain your market, your position in it, the size of it, it’s growth, your customers and your product.They will normally interview some of your customers and will try and form a view of why customers buy from you, how sensitive they are to pricing changes, whether they like you a lot or just a little and whether any big customers are thinking of leaving.They will also look at key suppliers and see if there are any risks or concentrations there. They’ll analyse risk of suppliers disinter-mediating you and going straight to the customer, and the same in reverse for customers.Most people find the customer interviews part of CDD the most interesting and useful – it’s’ a relatively simple exercise that few of us get round to doing in the normal course of business and it can sometimes reveal surprises. It’s not uncommon to find that you thought customers chose you for one thing but actually they value another.
COMMERCIAL INTANGIBLE --: An intangible that is used in commercial activities such as the production of a good or the provision of a service, as well as an intangible right that is itself a business asset transferred to customers or used in the operation of business.
Commercial Lease: A Commercial Lease is the contract a business enters into with a landlord. Important terms in commercial leases include the contract term (number of years), permitted activities within the space, allocating responsibility for maintenance and repairs, acceleration clauses, personal guarantees, CAM expenses, insurance requirements, default, and remedy provisions. A poorly negotiated Commercial Lease can become a very large liability, especially if a personal guaranty has elimited limited liability protections. Striking the right balance of cost-sharing and risk allocation between landlord and tenant often requires an understanding of the intricacies of the commercial real estate market.
Commercial Paper: An unsecured, short-term debt security issued by a corporation to finance short-term liabilities. These notes are normally backed only by the issuing corporation’s promise to pay the face amount on the maturity date specified on the note, which is usually less than six months.
Commission: A percentage of the total invested in a financial product (such as a mutual fund, annuity, or other investment) that is paid to the sales representative who sold the product.
Commissioner of Accounts: . Attorneys appointed by the Judges of the various Circuit Courts in the various counties and cities of Virginia, with the authority and responsibility for auditing inventories and accounts filed by executors, administrators and other fiduciaries, reporting their findings to the Court, and enforcing filing requirements, if necessary.
Commodities: The generic term for goods such as grains, foodstuffs, livestock, oils, and metals which are traded on national exchanges. These exchanges deal in both "spot" trading (for current delivery) and "futures" trading (for delivery in future months).
Commodities (or Natural Resources): Bulk products, such as metals, grains, and foods, that are traded on a commodities exchange. Investments in commodities typically are in contracts which are bought and sold by the individual, mutual fund, or limited partnership. Investors rarely take physical possession of the assets.
COMMODITIES FUTURES --: Contracts, traded on recognized futures markets, in which sellers promise to deliver a given commodity by a certain date at a predetermined price.
COMMODITY TAX --: Tax based on a selective number of commodities.
Common disaster clause –: A statement in a will telling how property in the estate is to be distributed if would be devisees die from the same accident.
COMMON LAW --: The body of law developed by the judiciary in systems based on English law and which is followed under the doctrine of precedent, i.e. past judicial decisions on similar cases. Much of it is now incorporated in statute. Also this term is used to describe a system ultimately based on English legal systems, as opposed to civil law systems.
Common Stock: A security that represents partial ownership of a corporation. Those who hold common stock are entitled to participate in stockholder meetings, to vote for the board of directors, and may receive periodic dividends.
COMMON STOCK --: The ordinary stock of a corporation. An equity or ownership interest in a corporation. The holder of common stock usually has a vote in deciding company affairs. Common stock is usually last in priority when profits or assets are distributed.
Commorientes: – Latin term referring to when people all die together at the same time, and it is uncertain as to who died first.
Communication: requires active listening, facilitating dialogue, and the ability to express thoughts, feelings, and ideas clearly, concisely, and compellingly.
Communication’s 6 Cs: are the six basic attributes required for sending a message or sharing information:·
Communities of Practice: A group of people bound by a shared interest, purpose, or practice. Within communities of practice, people share ideas and knowledge in many different ways, including real-time collaborative sessions, newsletters, and links to Websites. Communities of practice are often more flexible than formal networks in filling in gaps for community members about how formal training, policies, and procedures work in the "real" world.
Community of Practice (CoP): is a group of people who have a common interest in an area of competence and share the experiences of their practice.
Community Property: State laws vary, but generally all property acquired during a marriage -- excluding property one spouse receives from a will, inheritance, or gift -- is considered community property, and each partner is entitled to one half. This includes debt accumulated. Nine states currently have community property laws: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. (Alaska adopted a community property system in 1998, but it is optional.)
COMPANY --: Often used to mean a separate legal entity (a corporation) organized to perform an activity, business or industrial enterprise. Sometimes it has a broader meaning to mean individual or collective enterprises seeking profit.
COMPARABILITY ANALYSIS --: Comparison of controlled transaction conditions with conditions prevailing in transactions between independent enterprises (uncontrolled transactions). Controlled and uncontrolled transactions are comparable if none of the differences between the transactions could materially affect the factor being examined in the methodology (e.g. price or margin), or if reasonably accurate adjustments can be made to eliminate the material effects of any such differences.
COMPARABLE PROFIT METHOD (CPM) --: Under US regulations CPM is a method to determine an arm's length consideration for transfers of intangible property. If the reported operating income of the tested party is not within a certain range, an adjustment will be made. In effect this method requires a comparison of the operating income that results from the consideration actually charged in a controlled transfer with the operating income of similar taxpayers that are uncontrolled.
COMPARABLE UNCONTROLLED PRICE (CUP) METHOD --: A transfer pricing method that compares the price for property or services transferred in a controlled transaction to the price charged for property or services transferred in a comparable uncontrolled transaction in comparable circumstances.
COMPARABLE UNCONTROLLED TRANSACTION (CUT) METHOD --: A transfer pricing methodology used in the US, which determines an arm's length royalty rate for an intangible by reference to uncontrolled transfers of comparable intangible property under comparable circumstances.
COMPENSATING ADJUSTMENT --: An adjustment in which the taxpayer reports a transfer price for tax purposes that is, in the taxpayer's opinion, an arm's length price for a controlled transaction, even though this price differs from the amount actually charged between the associated enterprises. This adjustment would be made before the tax return is filed.
COMPENSATION --: Direct and indirect monetary and non-monetary rewards to employees.
COMPENSATORY STOCK OPTIONS --: Options offered to employees as partial compensation for their services.
Competency: A measurable pattern of knowledge, skills, abilities, behaviors, and other characteristics that an individual needs to perform work roles or occupational functions successfully. Competencies specify the "how" of performing job tasks, or what the person needs to do the job successfully.
Competency –: A person generally is competent to make a will if the testator understands the following:1. The general nature and extent of his/her property,2. The testator’s relationship to the people named in the will,3. What a will is, and4. The transaction of simple business affairs
Competency Gap: The difference between the projected or actual availability of mission-critical competencies and the projected or actual demand for such competencies. Identification of current or future gaps typically addresses the size, composition, and competency proficiency levels of the workforce.
Competency Model: A framework that describes the full range of competencies required to be successful in a particular occupation. These models usually describe the required occupation-specific, or technical, competencies and general cross-occupational competencies (e.g., analytical competencies). Competency models are used to support key human capital programs such as selection, career development, training, and performance management.
Competency-Based Career Development Program: A program that focuses on the development of competencies so that employees acquire the critical skills and knowledge needed to perform their jobs and advance in their careers. Competencies define the clusters of knowledge and skills collectively needed for successful job performance and are directly related to achieving the agency's mission and goals. Through competency-based career development programs, agencies ensure they cultivate the skills and knowledge needed by the workforce to carry out mission requirements.
Competency-Based Learning: is an instructional approach that focuses on individual skills or outcomes, known as competencies (usually defined in a competency dictionary created from an occupational analysis of the skills required for successful performance). The approach is focused on individual learners who work on one competency at a time, with the ability to skip a learning module if they can demonstrate a mastery of the skills contained within it. It’s applied most often to skills-based learning.
COMPETENT AUTHORITY (CA) --: Forum to resolve disputes arising from the application and/or interpretation of a double tax treaty. Both treaty countries appoint a representative (frequently the Ministry of Finance or its authorized representative) as the CA to assist aggrieved taxpayers by acting as the official liaison with the foreign CA. The CA is generally indicated in the definitions sections of tax treaties.
complete—: articulating comprehensive messages that include all the details·
Compliance: is an action that is mandated by a law, agency, or policy outside the organization’s purview. It is generally accompanied by a training program requirement.
COMPLIANCE --: See: Tax compliance
Compound Interest: A process under which interest is computed both on an account’s principal and on any gains reinvested in prior periods. This is contrasted with simple interest, in which interest is calculated only on the principal amount.
COMPREHENSIVE WEALTH MANAGEMENT: We provide a comprehensive approach to handling the financial blessings and challenges of life, including education, inheritances, retirement, and leaving a legacy.
Computer-based training (CBT): is any course of learning that encompasses the use of computers in both instruction and management of the teaching and learning process. There is no single definition because many other terms are included under the CBT umbrella, including computer-aided instruction, computer-managed instruction, and computer-based instruction.
concise—: choosing short specific sentences and phrases; avoiding rambling·
CONDUIT APPROACH --: A method whereby income or deductions flow through to another party
CONDUIT COMPANY --: Company set up in connection with a tax avoidance scheme, whereby income is paid by a company to the conduit and then redistributed by that company to its shareholders as dividends, interest, royalties, etc.
Conference/workshop: An organized learning event that has an announced educational or instructional purpose; more than half the times is scheduled for a planned, organized exchange of information between presenters and audiences which meets the definition of training in 5 U.S.C. 4110; content of the conference/retreat is germane to improving individual and/or organizational performance; and developmental benefits will be derived through the employee's attendance.
Confidence interval: is the defined range within which a set of values are expected to be.
Confidentiality Agreement: A Confidentiality Agreement seeks to prevent a party receiving confidential information from sharing that information without the consent of the disclosing party. Typical Confidentiality Agreements define what is and is not confidential information, obligations of the receiving party and remedies if the receiving party shares the confidential information. Upfront clarity, achieved through careful drafting of a Confidentiality Agreement, is one of the best ways a company can help ensure that important information remains confidential after it is disclosed in the course of business.
Conflict management: is the ability to limit the negative aspects and increase the positive aspects of disagreements, battles, and differing opinions and desires.
Consanguinity: – of Latin origin meaning ‘shared blood’ or blood relationships, people who have descended from a common ancestor, the same bloodl line. Different to a relationship of affinity, which is being related to someone by marriage.
Conservation Easement: A specialized easement used to convey specific property rights (typically residential or commercial development rights) to a land trust, thus restricting the future use of the real estate.
Conservator: – A person appointed by the court to protect and manage the interests of the estate (property and business matters), financial affairs, and/or daily life of another person due to physical or mental limitations or age.
CONSIDERATION --: Anything of value, including property, given in return for a promise or performance by another party to form a contract
CONSOLIDATED TAX RETURN --: A combined tax return in the name of the parent company filed by companies organized as a group.
CONSORTIUM --: Association of business enterprises, whether individuals, partnerships or companies, operating together on a temporary basis for some specific venture.
CONSTRUCTIVE DIVIDEND --: A variety of payments whether in cash or in kind made by companies to shareholders or associated persons, which are not expressed as dividends, may nevertheless be regarded by the tax law as distributions of profits and treated for tax purposes as if they were dividends.
CONSTRUCTIVE OWNERSHIP --: A taxpayer may be considered to own property or stock which he only indirectly owns.
Constructivism: is a learning theory that states that people construct their own understanding and knowledge of the world through their experiences and reflecting on them. Swiss developmental psychologist Jean Piaget was a key proponent of constructivism suggesting that learners construct knowledge from assimilation and accommodation.
Consulting: is the short-term, internal or external defined process for solving problems and helping individuals, groups, or organizations move from a current state to a desired state.
Consumer Price Index: A monthly report that tracks inflation and the cost of living. It measures changes in the cost of a given set of consumer products and services, such as housing, food, utilities, and transportation.
Consumer Price Index (CPI): The U.S. government’s main measure of inflation, calculated monthly by the Department of Labor.
CONSUMPTION TAX --: Tax generally intended to fall on the ultimate consumption of goods and services.
content item: An individual quality, skill, or qualification within a content type that you track in profiles.
Content management system (CMS): is a computer software system that supports the creation, organization, and modification of digital documents and other content by multiple users for an organization's web content or digital assets.
content type: An attribute such as a skill, quality, or qualification that is added to a profile.
Contested, Hostile: Where there is more than one bidder and the proposal is hostile.
Contested, Recommended: A bid is contested when there is more than one bidder. A contested recommended bid describes the bid that has been recommended by the target management in the face of a competing bid.
Contested, White knight: Occurs when a company that is subject to a contested hostile bid seeks a friendly merger partner to fend off the hostile bidder.
Contingency Plan: Provisions in a comprehensive succession plan that mitigate the financial devastation caused by untimely death, disability and/or deteriorating health
Contingency plan –: Provisions in a comprehensive succession plan that mitigate the financial devastation caused by untimely death, disability and/or deteriorating health.
Contingent: – in relation to gifts made by a will. Means that a gift is subject to some condition being met before the item can be given. For example a child beneficiary might have to reach a certain age before receiving a gift. Until that time it is held on trust for them by the trustees named in the will.
Continued Service Agreement: An agreement an employee makes to continue to work for the Government for a pre-established length of time in exchange for Government sponsored training or education.An employee selected for training for more than a minimum period prescribed by the head of the agency shall agree in writing with the Government before assignment to training that he will—continue in the service of his agency after the end of the training period for a period at least equal to three times the length of the training period unless he is involuntarily separated from the service of his agency; andpay to the Government the amount of the additional expenses incurred by the Government in connection with his training if he is voluntarily separated from the service of his agency before the end of the period for which he has agreed to continue in the service of his agency.
Contract: An agreement between two individuals or entities about how to administer something to happen in the future (Example: life insurance company agrees to pay an amount to a specified person upon the death of the insured).
CONTRACT MANUFACTURER --: A manufacturer, in most cases, located in a low-cost jurisdiction, which has a license to use an intangible property developed by its parent company. The manufacturer uses the intangible property to produce tangible property which is then resold to the parent for distribution to ultimate customers.
CONTRIBUTION ANALYSIS --: Where the profit-split method is applied in transfer pricing cases, a contribution analysis requires that the combined profit be divided between associated enterprises based upon the relative value of the functions performed by each of the associated enterprises participating in the controlled transaction.
CONTROL: -- The capacity of one person to ensure that another person acts in accordance with the first person's wishes, or the exercise of that capacity. The exercise of control by one person over another could enable individuals and corporations to avoid or reduce their tax liability. A company is usually regarded as controlling another company if it holds more than 50% of the latter company's voting shares. However, the definitions vary according to country and situation.
CONTROLLED TRANSACTION: -- Transactions between two enterprises that are associated enterprises with respect to each other.
CONTROLLING INTEREST: -- Ownership of more than 50% of a corporation's voting shares.
CONTROLLLED FOREIGN COMPANIES (CFC): -- Companies, usually located in low tax jurisdictions, that are controlled by a resident shareholder. CFC legislation is usually designed to combat the sheltering of profits in companies resident in low- or no-tax jurisdictions. An essential feature of such regimes is that they attribute a proportion of the income sheltered in such companies to the shareholder resident in the country concerned. Generally, only certain types of income fall within the scope of CFC legislation, i.e. passive income such as dividends, interest and royalties.
Convertible Term Insurance: A term life insurance policy under which the policyholder has the right to convert the policy to permanent life insurance, subject to limitations. Several factors will affect the cost and availability of life insurance, including age, health, and the type and amount of insurance purchased. Life insurance policies have expenses, including mortality and other charges. You should consider determining whether you are insurable before implementing a strategy involving life insurance. Any guarantees associated with a policy are dependent on the ability of the issuing insurance company to continue making claim payments.
COOPERATIVE SOCIETY: -- In general, cooperative societies are founded to reduce the purchase price or increase the sales price of certain products for the benefit of their members or to serve the interest of their members in some other way, among small traders, farmers, consumers, etc.
COORDINATION CENTRE: -- Enterprise whose only purpose is to coordinate the activities of affiliated companies, to do research or to carry out support activities for the benefit of such corporations.
COPYRIGHT: -- Exclusive right granted to authors and artists to publish, use and exploit their literary or artistic works.
Corporate Bond: A debt security issued by a corporation under which the issuer promises to make periodic interest payments and to repay the investor’s principal at maturity. The market value of a bond will fluctuate with changes in interest rates. As rates rise, the value of existing bonds typically falls. If an investor sells a bond before maturity, it may be worth more or less than the initial purchase price. By holding a bond to maturity, investors will receive the interest payments due plus their original principal, barring default by the issuer. Investments seeking to achieve higher yields also involve a higher degree of risk.
Corporate Goals and Values: Goals and/or values that represent those of the organization from a strategic level and cascading to organization units to use in the performance appraisal process
CORPORATE INCOME TAX: -- Income tax on the income of companies
Corporate Values: Corporate values are the operating principles that guide an organisation’sinternal behaviours, as well as the relationship that the organisation haswith its customers, staff and stakeholders.
CORPORATE VEIL: -- As a corporation is a separate legal entity, and shareholders have an interest in the company rather than in its assets, the corporate veil is used to describe the inability to look behind the legal entity and attribute the actions assets, debts and liabilities of a company to those standing behind it, notably the shareholders. Courts may sometimes be able to “pierce” (look through) the corporate veil to make an attribution to the underlying person or persons.
Corporation: A legal organization created under the laws of a state as a separate legal entity that has privileges and liabilities that are distinct from those of its members. Corporations are taxable entities—they are taxed separately from their members or shareholders. Corporations are able to borrow money and to make a profit separately from their members or shareholders.
CORPORATION SHOPP: ING -- Term sometimes used in addition to treaty shopping to denote the use of tax treaty provisions by interposing a company instead of a different form of association for which tax relief would not been available.
Corpus of a trust –: The assets (property) placed in a trust. The trust holds title to all property included in the corpus.
correct—: selecting words that ensure accuracy and using correct grammar; avoiding misusing words·
Correction deed -: A document used to correct an error in a previously recorded deed.
Correspondence Training: Self-study course material:Training provided via the assignment of non-interactive methods, such as book, document, regulation or manual.
CORRESPONDING ADJUSTMENT: -- An adjustment to the tax liability of the associated enterprise in a second jurisdiction made by the tax administration of that jurisdiction, corresponding to a primary adjustment made by the tax administration in a first tax jurisdiction, so that the allocation of profits by the two jurisdictions is consistent.
COST: -- Purchase price paid for property or the value of the exchange for which property is given.
COST CONTRIBUTION ARRANGEMENT (CCA): -- A CCA is a framework agreed among enterprises to share the costs and risks of developing, producing, or obtaining assets, services, or rights, and to determine the nature and extent of the interests of each participant in the result of the activity of developing, producing, or obtaining those assets, services, or rights.
COST FUNDING: -- Contribution of an affiliate company to the general research and development (R&D) costs of another affiliate or group member, in proportion to its turnover or some other criterion
COST OF GOODS SOLD (COGS) --: A figure representing the cost of buying raw materials and producing finished goods. Included are clear-cut factors, such as direct factory labour, as well as others that are less clear-cut, such as overhead
COST-PLUS MARK-UP --: A mark up that is measured by reference to margins computed after the direct and indirect costs incurred by a supplier of property or services in a transaction
COST-PLUS METHOD --: A transfer pricing method using the costs incurred by the supplier of property (or services) in a controlled transaction. An appropriate cost plus mark up is added to this cost, to make an appropriate profit in light of the functions performed (taking into account assets used and risks assumed) and the market conditions. What is arrived at after adding the cost plus mark up to the above costs may be regarded as an arm's length price of the original controlled transaction.
COST-SHARING AGREEMENT --: See: Cost-contribution agreement
courteous—: using words that are respectful, friendly, positive, gender-neutral, and sensitive; avoiding accusing or blaming.
Coverdell Education Savings Account (Coverdell ESA): A tax-advantaged investment account that allows accumulation of funds to cover future education expenses, subject to limitations. Coverdell ESAs allow money to grow tax deferred and proceeds to be withdrawn tax free for qualified education expenses at a qualified institution.
CPM --: See: Comparable profit method
Creative thinking: is a way of looking at problems or situations from a fresh perspective that suggests unorthodox solutions. Creative thinking can be stimulated by an unstructured process such as brainstorming and by a structured process such as lateral thinking.
CREDIT METHOD --: See: Credit, foreign tax
Credit Score: A statistical estimation of how likely a potential borrower is to pay his or her debts and, by extension, how much credit he or she should have.
Credit Shelter Trust: A trust established to use the applicable estate tax exclusions (credits) of both spouses (sometimes referred to as the ”B” trust).
CREDIT, FOREIGN TAX --: A method of relieving international double taxation. If income received from abroad is subject to tax in the recipient's country, any foreign tax on that income may be credited against the domestic tax on that income. The theory is that this means foreign and domestic earnings of an entity will as far as possible be similarly taxed, although usually the credit allowed is limited to the amount of domestic tax, with no carry over if tax is higher abroad.
CREDIT, TAX --: Allowance of deduction from or a direct offset against the amount of tax due as opposed to an offset against income.
CREDIT, UNDERLYING (INDIRECT) TAX --: In relation to a dividend, credit for underlying tax is credit for the tax levied on the profits of the company out of which the dividends have been paid. Such relief may be given either under a tax treaty or in accordance with unilateral provisions.
CREDIT, WITHHOLDING TAX --: Various kinds of income (such as dividends, interest, royalties) are taxed at source by requiring the payer to deduct tax and account for it to the tax authorities (abroad). The taxpayer recipient is entitled to credit the tax withheld at source against his final tax liabilities determined by (domestic) tax law of the country in which he is resident.
CREDITOR --: A person who extended credit and to whom money is owed; a lender
Criterion-referenced: is a kind of test or assessment that measures learners’ performance against a specific set of predetermined criteria or standards.
Critical path method (CPM): is a chart that is similar to a program evaluation review technique (PERT) chart. A CPM chart indicates the critical path, which is the path of tasks that together take the longest time to complete.
Critical Skill: A critical skill is one that is essential in order for an individual to completea task. Although enough to complete a task critical skills alone are notenough to reach maximum proficiency at tasks.
Critical thinking: is a form of analysis that helps evaluate an issue to form a judgment that is logical and well thought out. It does not accept all arguments and conclusions on face value. Rather, it requires viewing the evidence that is involved to support an argument or conclusion. The skills that comprise critical thinking include analytical thinking, open-mindedness, problem solving, and decision making.
Cross Border: A transaction that is conducted across national boundaries i.e. a deal that involves companies from at least two different nationalities.
Crowdsourcing: is a term referring to the ability of many to accomplish what has been traditionally accomplished by a smaller, more specialized group. The attraction of crowdsourcing is the idea that it calls to action people who are best able to solve problems, channel creativity, and do smart work.
Cultural Awareness and Inclusion: refer to the ability to convey respect for different perspectives, backgrounds, customs, abilities, and behavior norms, as well as ensure all employees are respected and involved by leveraging their capabilities, insights, and ideas.
Culture: represents the collective assessment of an organization based upon deeper, relatively enduring, often unconscious values, norms, and assumptions.
Culture of Learning: By investing in and developing your workforce you will begin to create aculture of learning amongst employees. Those who want to betterthemselves and develop will be willing to learn, which in turn influencesothers until the organisation has an evident learning culture.
CUP METHOD --: Comparable uncontrolled price method
CURRENT ASSETS: -- The cash, accounts receivable, inventory, and other assets that are likely to be converted into cash, sold, exchanged, or expensed in the normal course of business, usually within a year.
Custodian: A person named (often by court action) to care for a person who is not able to care for themselves.
CUSTOMS DUTIES --: Taxes on goods imported into a country
Succession Planning: D
DAMAGES: -- The amount received (other than worker's compensation) through prosecution of a legal suit or action based on tort or tort-type rights, or through a settlement agreement entered into in lieu of such prosecution.
Data and Analytics: are key drivers for organization performance and should be drivers for talent development.
Data collection: is the act of gathering of all facts, figures, statistics, and other information for analyses and assessments; examples of data-collection methods or tools include questionnaires, interviews, and observations.
data validity guideline: Specified time frame beyond which ratings are out of date for a talent review.
DE MINIMIS: -- Phrase used in connection with circumstances in which the full rigour of the tax law is not enforced because, in particular, of the small amount or minor breach which may be involved, particularly in the context of under-assessed or underpaid tax which are not pursued on "de minimis" grounds.
Deal Fees: When you do a deal a raft of advisors will have “helped”. Some of these will have worked for your some will have worked for the PE firm. All of these hungry mouths need feeding and they are fed with “deal fees”.If you’ve been running a tight business without spending hundreds of thousands of pounds on consultants, these fees will be eye-watering. However they are unavoidable. Fortunately (sort of) they get added to the purchase price of your business so you don’t need to pay for them out of your own cash flow.So if the PE firm is paying £10m for a 55% share in your business and the deal fees are £2m, then the total cost of the business to them is actually £12m, This is the total deal cost. This eventually gets paid back either from cash you generate during the investment period or by being deducted from the sale price when you sell at the end of the investment window.The Investment Bank or sell-side advisor gets the biggest cheque – normally a percentage of the price paid. Next biggest cheques go to financial diligence providers, commercial diligence providers and so on down to the smallest players like insurance diligence.
Deal Value: Deal Value reflects what actually happens on the deal itself and reflects a stake purchase and whether net debt is assumed by the bidder party. The rule we follow is that if the acquirer acquires more than 50% of the share capital of the target company, or if the acquirer ends up with a total stake in the target that exceeds 50% (i.e. they hold 30% and acquire a further 30%), then we include 100% of the net debt in the deal value. If the stake is less than 50%, we do not include net debt in the deal value. With this logic, if the acquirer acquires 100% control of the target, then the deal value will equal the enterprise value (they purchase all shares and assume all net debt). If the acquirer acquires say a 60% stake in the target, then the deal value will represent the value of 60% of the share capital acquired (i.e. 60% of Implied Equity Value (IEV)) but will also include 100% of the net debt assumed. Finally, if the acquirer acquires say a 30% stake, the deal value will simply represent the value this stake (i.e. 30% of the IEV).
DEATH DUTIES: --Taxes imposed on the transfer of property on account of a person's death.
Death taxes –: Taxes due by reason of death of an individual. These may include federal, state, and local estate and/or inheritance taxes.
DEBENTURE: -- Interest-bearing bond which is not secured by any specific property, usually issued by a corporation or government to the general public
Debt: An obligation owed by one party (the debtor) to a second party (the creditor).
DEBT CAPITAL: -- Funds obtained through various types of loan which normally comprehends debentures and bonds bearing fixed interest.
DEBT DUMPING: -- Transferring a bad debt to a group company located in a higher-tax rate country in order to write off the debt in that country.
DEBT INSTRUMENT: -- A written promise to repay a debt, such as a bill, bond, banker's acceptance, note, certificate of deposit, or commercial paper.
DEBT/EQUITY RATIO: -- Relationship of total debt of a company to its ordinary share capital. If a corporate debt is disproportionately high in comparison with its equity, the debt may be recharacterised as equity, resulting in a disallowance of the interest deduction and taxation of the funds as dividends.
DEBTOR: -- A person who owes money; a borrower
Debt-to-Equity Ratio: The ratio of a company’s total debt to its total shareholder equity. Some use the debt-to-equity ratio to attempt to ascertain a company’s capability to repay its creditors.
Deceased estate: – all the property (both real estate and personal property) a person owns in their sole name when they die. The
Decedent: . The individual who is deceased, whether testate (with a valid Last Will and Testament) with probate assets that may require probate with the Court, or intestate (without a valid Last Will and Testament), with probate assets that require probate.
Decedent –: The person who has died.
Deduction: An amount that can be subtracted from gross income, from a gross estate, or from a gift, thereby lowering the amount on which tax is assessed.
DEDUCTION AT SOURCE: -- See: Withholding tax
DEDUCTIONS: -- Deduction denotes, in an income tax context, an item which is subtracted (deducted) in arriving at, and which therefore reduces, taxable income.
Deed: A legal document that confirms ownership of an asset or that confirms the passage of an interest, right, or ownership in the asset from one person or legal entity to another.
Deed –: A legal instrument used to transfer title to real property in the eyes of the law. Specific types of deeds may include the following:
Deed in escrow -: Papers prepared to transfer real estate to another owner and given to a third party for delivery at a later date or when the specified conditions are met.
Deed Restriction: Instructions contained in a deed, which limit the future use or transfer of real property (Example: Conservation Easement or Reversionary Interest).
Deed restrictions -: Provisions placed in deeds to control how future owners may or may not use the property.
DEEMED INTEREST: -- If a member of a multinational enterprise (MNE) receives an interest-free loan from an affiliated company, the tax authorities of the lender's country may readjust the lender's profits by adding an amount equal to the interest which would have been payable on the loan had it been made at arm's length.
DEEP DISCOUNT BOND: -- See: Zero coupon bond
DEFAULT: -- The failure of a debtor to make timely payments of interest and principal amounts as they come due or to meet some other provision of a bond, mortgage, lease, or other contract.
DEFERMENT OF TAX: -- The postponement of tax payments from the current year to a later year. A number of countries have introduced legislation to counter the kind of tax avoidance whereby a taxpayer obtains a deferment of tax which is not intended by law. Ex) CFC legislation
Deferred Annuity: A contract with an insurance company that guarantees a future payment or series of payments in exchange for current premiums. The interest earned on an annuity contract is not taxable until the funds are paid out or withdrawn. The guarantees of an annuity contract depend on the issuing company’s claims-paying ability. Annuities have fees and charges associated with the contract, and a surrender charge also may apply if the contract owner elects to give up the annuity before certain time-period conditions are satisfied.
DEFERRED INCOME: -- Term used to describe income which will be realized at a future date, thus delaying any tax liability.
DEFICIENCY: -- The excess of a taxpayer's correct tax liability for the taxable year over the amount of taxes previously paid for that year. A US concept
Define, measure, analyze, improve, and control (DMAIC) methodology: is a five-step data-driven improvement process used for reduction of defects, process improvement, and customer satisfaction. It is the core tool used to lead Six Sigma projects.
Defined Benefit Plan: A qualified retirement plan under which a retiring employee will receive a guaranteed retirement fund, usually payable in installments. Annual contributions may be made to the plan by the employer at the level needed to fund the benefit. The annual contributions are limited to a specified amount, indexed to inflation.
Defined Contribution Plan: A retirement plan under which the annual contributions made by the employer or employee are generally stated as a fixed percentage of the employee's compensation or company profits. The amount of retirement benefits is not guaranteed; rather, it depends upon the investment performance of the employee's account.
Deflation: A reduction in the price of goods and services. Deflation is the opposite of inflation.
DELINQUENCY: -- Tax which is in default (i.e. due but not yet paid) is often referred to as a "delinquent" tax in North American parlance.
Delivery: is any method of transferring content to learners, including instructor-led training, virtual training, CD-ROMs, and books.
DEMAND LOAN: -- A loan payable on request by the creditor rather than on a specific date.
Demerger: Occurs when a company decides to split off one of its subsidiaries to its shareholders, resulting in the creation of a separate business divorced from the activities or influences of the former parent; in other words, the shareholders end up holding two share certificates (one for each company) as opposed to one share certificate in the original business. Note that neither the company nor shareholders receive any cash as a result of the deal (as opposed to as flotation or IPO where the company receives cash).
Departure-defined succession: planning happens when a leader announces he or she plans to leave or retire, for example, in 18-24 months. Here the board takes an active role in preparing the organization for a leadership transition—agreeing upon organizational priorities, building board and staff capacity, and taking the essential steps to prepare the organization for an executive search that will attract the very best candidates.
Dependent: A person who relies on another for his or her financial support. Within limits, those who support dependents are allowed to claim certain exemptions when filing income taxes.
DEPENDENT AGENT: -- See: Agency
DEPENDENT PERSONAL SERVICES: -- The OECD model tax treaty provides rules for the treatment of salaries, wages and other similar remuneration (i.e. employment income) under the heading "dependent personal services". As a general rule, with some exceptions, the right to tax income from dependent personal services is allocated to the country where the employment activities are exercised.
DEPLETION: -- Deductible expense which reflects the decrease of a natural resource due to extraction of the resource.
DEPRECIATION: -- An accounting technique in which the cost of an asset is allocated over its useful life.
DERIVATIVE FINANCIAL INSTRUMENTS: -- Also known as derivatives. These are financial instruments whose values are linked to or depend on the value of a primary (underlying) asset, e.g. debt assets, liabilities and equity securities, commodities or currency. The primary types of derivatives include forward contracts, futures, options and swaps.
Design thinking: is a human-centered process that provides a means for defining problems from multiple perspectives, brainstorming possible solutions, prototyping those solutions, and then testing and iterating to optimize the best approach. It focuses on the spot where business needs, user needs, and technology or environmental constraints meet.
DESTINATION PRINCIPLE: -- Principle under a VAT regime which mandates that VAT on goods be paid in the country where the purchaser is resident (i.e. the country of consumption) at the rate that would have applied had the goods been purchased from a domestic supplier.
Detail: A temporary assignment of an employee to a different position for a specified period, with the employee returning to his or her regular duties at the end of the assignment. A detail assignment implies that there is a vacant position available for the candidate to occupy which requires a Standard Form 52 preparation and submittal through proper channels.
Development: is the acquisition of knowledge, skill, or attitude that prepares people for new directions or responsibilities. It may also refer to the third phase in ADDIE, in which training materials and content are selected and developed based on learning objectives.
Development goal: A goal that is geared toward facilitating the career growth of individuals so that they can perform better in their current job or prepare themselves for advancement.
Development Plan: Long-term development plan used to track and measure objectives for successors or high-potentials
Developmental Assignment: Work assignment designed to provide exposure to different leadership experiences and perspectives. They include, but are not limited to, rotations, shadowing, and project which provide visibility at high levels of organizational leadership as well as critical knowledge for long-term career planning.
Devise: – to give real estate (real property) by will, a gift of real estate or realty.
Devolves, devolution: – the passing of rights, property from one person to another on the occurrence of an event, for example death.
Diagnostics: Performing diagnostics is the process of identifying errors and flaws incurrent practices of a business. By performing diagnostics you can helpalign your businesses practices with its objectives and values.
DIRECT CHARGE METHOD A: -- method of charging directly for specific intra-group services on a clearly identified basis.
DIRECT COST: -- Cost identified with a particular transaction, such as raw materials, components and goods, wages and other processing expenses.
DIRECT INVESTMENT: -- Description often given to a substantial investment in the shares of a company.
DIRECT METHOD OF ALLOCATION OF COSTS: -- Allocation method where the parent company or group service centre of a multinational enterprise providing central management and other services charges each member of the group directly for individual services rendered.
Direct Rollover: The direct transfer of assets from the trustee or custodian of one qualified retirement plan or account to the trustee or custodian of another. Done correctly, direct rollovers do not trigger taxable events.
DIRECT TAX: -- Direct taxes are taxes imposed on income, capital gains and net worth. Gift tax, death duties and property tax are also considered direct taxes.
DIRECTIVE: -- An official order or instruction. In EU context, it means one of the legal instruments issued by the competent institutions of the European Union. A directive is addressed to the Member States requiring them to make such changes to their domestic legislation as necessary to satisfy a provision of one of the EC treaties.
Disability Income Insurance: An insurance policy that pays a portion of the insured’s income when a specified disability makes working uncomfortable, painful, or impossible.
DISCOUNT: -- Amount by which the face value of a debt obligation exceeds its issue or selling price.
Discovery learning: is a specific learning process in which participants encounter a problem in an activity, respond to the problem, identify useful knowledge or skills gained, debrief what was learned, and plan for transferring what they learned. This process is also known as experiential learning or experiential learning activity. See also Experiential Learning Activity (ELA).
Discrimination: The act of discrimination itself means to treat certain groups of peopleless favourably, for example due to gender or sexual orientation.Discrimination in the workplace can occur through, staff recruitment,terms and conditions, who receives training or not and who is selected toprogress or be dismissed.
DISOLUTION OF CORPORATION: -- The termination of the legal existence of a corporation.
Dispensing power: – in the law of succession it is the power given to a court under an act of parliament to dispense with the formalities required by law to make a valid will. This is to permit a document which supposedly expresses the deceased person’s testamentary intentions, but which for some reason they hadn’t signed, and witnessed, according to law.
Disposition: – when a person gives something away they own in their own name to someone else for their benefit, with the intention that they keep it.
Dispute Resolution: A formal process for resolving disputes—may involve a facilitator, mediation or arbitration.
Distance learning: is an educational delivery in which the instructor and students are separated by time, location, or both. Distance learning can be synchronous or asynchronous.
DISTRIBUTION: -- A payout of cash or property from a corporation to a shareholder.
Diversification: An investment strategy under which capital is divided among several assets or asset classes. Diversification operates under the assumption that different assets and/or asset classes are unlikely to move in the same direction, allowing gains in one investment to offset losses in another. Diversification is an approach to help manage investment risk. It does not eliminate the risk of loss if security prices decline.
Diversity: Diversity literally means difference and is about recognising and valuingthose differences. By understanding and embracing our individualdifferences we can create a productive environment in which everyonefeels valued.
Divestment: The agreed sale of an asset or assets from one company to another, distinguished from other transactions by the fact that it is the vendor which actually initiates the transaction.
Dividend: Taxable payments made by a company to its shareholders. Some dividends are paid quarterly and others are paid monthly. Companies can adjust common share dividends at any time, pending approval by the company’s board of directors.
DIVIDENDS: -- A payment by a corporation to shareholders, which is taxable income of shareholders. Most corporations receive no deduction for it.
DOCUMENTATION: -- Official documents that are used to prove that something is true or correct
Dollar Cost Averaging: A system of investing in which the investor buys a fixed dollar amount of securities at regular intervals. The investor thus buys more shares when the price is low and fewer shares when the price rises, and the average cost per share is lower than the average price per share. Dollar cost averaging does not ensure a profit or prevent a loss. Such plans involve continuous investments in securities regardless of fluctuating prices. You should consider your financial ability to continue making purchases during periods of low and high price levels. However, this can be an effective way for investors to accumulate shares to help meet long-term goals.
Dollar-Cost Averaging: An investment strategy under which a fixed dollar amount of securities is purchased at regular intervals. Under dollar-cost averaging, more shares are purchased when prices are low and fewer shares when prices rise. Keep in mind that dollar-cost averaging does not protect against a loss in a declining market or guarantee a profit in a rising market. Investors should evaluate their financial ability to continue making purchases through periods of declining and rising prices.
Domestic: A transaction conducted within a national boundary i.e. a deal involving two or more incumbent nationals.
DOMESTIC CORPORATION: -- Corporation which is organized or has its place of effective management in a country.
DOMICILE: -- A person's domicile in English common law is his permanent home, the place to which he always intends to return. Residence is the place where an individual lives for a certain period of time, while domicile is the place where an individual makes his permanent home.
DOMICILE, FISCAL: -- Term sometimes used to mean the same as residence. Fiscal domicile does not necessarily have the same meaning as domicile.
Donatio mortis causa: – of Latin origin meaning a gift in contemplation of death.
Donee –: A person who receives a gift from another person.
Donor –: A person who makes (gives) a gift to another person.
DOUBLE DIPPING: -- Term used to indicate the possibility for dual resident companies to deduct the same expenses in two jurisdictions.
DOUBLE TAXATION TREATY: -- See: Tax treaty
DOUBLE TAXATION, DOMESTIC AND INTERNATIONAL: -- Domestic double taxation arises when comparable taxes are imposed within a federal state by sovereign tax jurisdictions of equal rank. International double taxation arises when comparable taxes are imposed in two or more states on the same taxpayer in respect of the same taxable income or capital, e.g. where income is taxable in the source country and in the country of residence of the recipient of such income.
DOUBLE TAXATION, ECONOMIC AND JURIDICAL: -- Double taxation is juridical when the same person is taxed twice on the same income by more than one state. Double taxation is economic if more than one person is taxed on the same item.
Double-loop learning: is changing underlying values and assumptions as decision making progresses. It is also referred to as reframing or changing the context.
DOW (Dow Jones Industrial Average): An index showing the values of 30 large publicly-traded U.S. companies. Reports that the DOW is up or down refer to the average increases or decreases in stock prices of those companies.
Dow Jones Industrial Average (DJIA): An average calculated by summing the prices of 30 actively leading stocks on the New York Stock Exchange (NYSE) and dividing the sum by a divisor which has been adjusted to account for cases of stock splits, spinoffs, or similar structural changes. Individuals cannot invest directly in an index.
Dower –: The legal right of a widow to a portion of her deceased husband’s real property for support of herself and children. This may be referred to as the elective share of a surviving spouse.
Drivers of change: Strategic drivers are major forces or trends that will shape the futureenvironment for skills within a particular business or industry. Forexample, your organisation may be planning on launching a new productor service that will require frontline staff with better communication andcustomer service skills. Alternatively, you may need managers withchange management skills to facilitate the implementation of supportingpolicies or procedures.
DTA: -- Double tax agreement. See Tax treaty.
DUAL RESIDENCE: -- Person or company resident in two or more countries under the law of those countries, because the two countries adopt different definitions of residence.
Due Diligence: For a typical £10m – £20m investment, the PE firm might spend £300k – £400k on advisor fees so they only do this when they’re serious about completing a deal.You start an exclusivity period by signing a short agreement or letter saying that you will now deal with that PE firm exclusively and will not talk to others. You’ll put your other bidders on hold so they know they’ve lost (or are likely to lose) the deal.If you fail to agree final terms during your exclusivity window, or your PE firm pulls out then you can go to your other bidders. In this situation, though, other bidders will want to know why your deal fell apart. This is a situation where it will really help if you did
Due Diligence (aka Diligence): Also see Vendor Due Diligence and Red Flags.Due Diligence is the process by which a PE firm tries to assess the viability of a potential investment and the accuracy and completeness of the information you have provided.In truth, much of the heavy diligence is done by the PE firm themselves as their work in deciding whether or not they should invest in you. Then when you’ve accepted an offer in principle, you’ll go into an exclusivity period.The use of external, specialist advisors to look at your business occasionally finds something that hadn’t been seen before and also covers the PE firm (somewhat) with their investors (the LP’s) if it all goes wrong later.There are several due diligence projects :
Durable power of attorney -: Allows the power of attorney to survive any disability the principal couldsuffer.
Durable Power of Attorney for Finances (DPOA): A durable attorney for finances (DPOA) enables you to authorize someone to act on your behalf in financial and legal matters. Your agent could pay everyday expenses, watch over your investments, and file taxes, among other tasks. A DPOA may become effective immediately or when a triggering event occurs, such as a doctor certifying that you are physically or mentally incapacitated.
Durable Power of Attorney for Health Care (HPOA): A durable power of attorney for health care (HPOA), also known as a health-care proxy, enables you to appoint a representative to make medical decisions for you if you become unable to do so yourself. You can appoint anyone to be your agent as long as the individual is of legal age (usually 18 or older), and you can decide how much power your representative will have. An HPOA should be HIPAA compliant so your representative can access your private medical information.
DUTY: -- Customs duties (sometimes called a tariff) levied on imported products.
DUTY-FREE ZONE: -- Zone usually located next to an international port or airport where imported goods may be unloaded, stored and reshipped without payment of customs duties or other types of indirect taxes, provided the goods are not imported.
Succession Planning: E
Early Withdrawal: Withdrawal of funds from an investment before its maturity date or withdrawal of funds from a tax-deferred account before the legally imposed age requirements have been satisfied. Early withdrawals may be subject to penalties.
EARNED INCOME: -- Income or compensation derived from personal services in an employment, trade, business, profession or vocation. (cf. investment income)
EARNINGS & PROFITS (E&P): -- A term referring to the economic capacity of a corporation to make a distribution to shareholders that is not a return of capital. Such a distribution would constitute a taxable dividend to the shareholder to the extent of current and accumulated earnings and profit under US tax law.
EARNINGS BEFORE TAXES: -- Sales revenue less cost of sales, operating expenses, and interest, before taxes have been paid.
EARNINGS STRIPPING: -- Practice of reducing the taxable income of a corporation by paying excessive amounts of interest to related third parties.
Easement: A document that records the transfer of a real property interest, such as the use of specified portion of the property.
EBITDA: Pronounced “eee-bit-dar”. Get used to this you’ll be saying it and hearing it every second sentence.EBITDA stands for Earnings Before Interest, Tax, Depreciation and Amortisation of Assets.It’s the key profit line that PE firms are interested in and it’s the profit line that is used as the measure when valuing your business.So if your business made £9m net profit, before taking a £2m depreciation charge on equipment and paying tax of £1.5m, everyone is interested in the £9m not the £5.5m of profit that you’ll actually report at Companies House.This focus on profit before depreciation causes the interesting effect that capital expenditure is ignored when looking at your profit line. So money that you spend on computer equipment, office fit-out and other cap-ex items doesn’t hit your profit line, it’s essentially free. Everyone head down to the Apple Store!This always seemed odd to me and it results in an annual tussle with the CFO where CEO’s desperately trying to hit their EBITDA budget try and reclassify blocks of expenditure as Capex.I’ve never fully grasped why depreciation is ignored but it’ll come in handy when you’re up against the wire..
EBO (Employee Buy Out): The acquisition of a company by its employees and management.
ECO TAX: -- See: Environmental tax
ECONOMIC DOUBLE TAXATION: -- See: Double taxation, economic and juridical
Educational and Training Services: Companies providing any educational and training services. Examples include educational publishing, colleges/schools, educational software, online educational programs and games.
Effect size: is a way of quantifying the difference between two groups using standard deviation. For example, if one group (the treatment group) has had an experimental treatment and the other (the control group) has not, the effect size is a measure of the difference between the two groups.
EFFECTIVE TAX RATE: -- The rate at which a taxpayer would be taxed if his tax liability were taxed at a constant rate rather than progressively. This rate is computed by determining what percentage the taxpayer’s tax liability is of his total taxable income.
EFFECTIVELY CONNECTED INCOME (ECI): -- Non-resident alien individuals and foreign corporations engaged in trade or business within the US are subject to US income tax on income, from sources both within and outside the US, which is "effectively connected" with the conduct of the trade or business within the US. Income is effectively connected if it is derived from assets which are used in or held for use in the US, and the activities of the US business were a material factor in the realization of the income.
Effectiveness: The level of achievement of program goals and the results intended (as defined in strategic plans and in legislation). Examples include the percentage of trainees employed 1 year after completing job training, the rate of compliance in filing tax returns, and the percentage of customers/employees satisfied in relation to relevant indices.
Efficiency: The ratio of the outcome or output to the input of any program; the degree to which programs are executed or activities are implemented to achieve results while avoiding wasted resources, effort, time, and/or money.
Efficient Frontier: A statistical result from the analysis of the risk and return for a given set of assets that indicates the balance of assets that may, under certain assumptions, achieve the best return for a given level of risk.
Elaboration: is a deliberate practice technique where learners put content into their own words and connect it with existing memories such as skills or knowledge they already have.
E-Learning: (Electronic Learning) is a term covering a wide set of applications and processes such as web-based learning, computer-based learning, virtual classrooms, and digital collaboration.
Emergency succession planning: is just like it sounds. Here the organization is putting in place plans and defining roles and responsibilities in order to ensure the organization can continue to operate without disruption in the event of a sudden, unplanned absence or the departure of a key leader or administrator.
Emotional Intelligence: is the ability to accurately identify and understand one's own emotional reactions and those of others. This eighth intelligence, based on Gardner's multiple intelligence theory, was popularized by Daniel Goleman in his book Emotional Intelligence.
Empathy: means recognizing emotional needs in others and effectively supporting them in the way that they require. It is the ability to view and understand other’s feelings, needs, and concerns, and is key to effective interpersonal relationships.
Employability: Employability consists of a set of achievements, skills, understandings andpersonal attributes that individuals possess.
Employee experience: , sometimes called the employee journey, is the perspective employees have about an organization that is influenced by their workspace, communication, work-life balance, interactions with their teams and supervisor, the technology and tools they use, and many other touchpoints of their jobs.
Employee Manual: An Employee Manual serves as a way for an employer to communicate and document expectations for employees. Typical Employee Manuals include anti-discrimination policies, work schedules, standards of conduct, safety policies, media policies, procedures for filing a complaint, and vacation policies. A thoughtful and comprehensive Employee Manual explains company policies so that everyone in the workplace is on the same page and so that issues can be measured against objective, pre-existing standards. Since North Carolina is an employment-at-will state, Employee Manuels must be carefully crafted so as to not give unintended rights or benefits.
EMPLOYEE PROFIT SHARING: -- System under which the employees of an enterprise are entitled by employment contract or by law to a share in the profits made by the enterprise.
Employee Retirement Income Security Act (ERISA): A federal law that establishes the regulations under which retirement plans are governed and spells out the federal income tax regulations and effects for qualified retirement plans.
EMPLOYEE STOCK OPTION --: An opportunity for employees to purchase stock (shares) in the company they work for, often at a discount from fair market value. Generally it is provided as an incentive to stay with the employer until the options vest.
Employee Stock Ownership Plan (ESOP): A defined-contribution plan that provides a company’s workers with an ownership interest in the company—usually as shares of company stock.
Employer Engagement: There is no set definition for employer engagement. However, it doesencompass work-related learning. Most importantly is helps build andsustain successful partnerships with employers.
Employer Identification Number (EIN or FEIN): – A unique number that identifies the business to theInternal Revenue Service.
Employer-Sponsored Retirement Plan: A retirement plan sponsored by an employer for the benefit of its employees. These typically fall into one of two types: defined-contribution plans (such as SEP IRAs, 401(k) plans and 403(b) plans) and defined-benefit plans (such as traditional pensions).
Employment Contracts: Employment Contracts help protect the founders by clearly defining rights and obligations for both the company and its employees. Employment Contracts can define salary, benefits, and job duties, as well as other aspects of the employer-employee relationship, such as ownership of intellectual properties created in the scope of employment, stock option agreements, and termination policies. Well-drafted Employment Contracts often help avoid or mitigate costly litigation and create clear expectations for all parties.
EMPLOYMENT INCOME: -- Income source of individuals, covering income derived from labour or other current or former dependent personal services such as salaries, wages, bonuses, allowances, compensation for loss of office or employment, pensions and, in some countries, certain social security benefits.
Encumbrance: Any recorded real property interest, which would reduce the ability of the holder of title to use or convey the property (Examples: mortgages or easements).
Enduring power of attorney: – a document in a form set down by law (see the Power of Attorney Act in each state and territory) which allows a person to name someone else to act on their behalf in regard to their finances and property, should they become incapacitated.
Energizer: is an activity designed to invigorate a group.
Enrolled Agent (EA): An enrolled agent is a person who has passed the appropriate examination in order to represent taxpayers before the Internal Revenue Service. Enrolled agents, like attorneys and certified public accountants, are unrestricted as to which taxpayers they can represent, what types of tax matters they can handle, and which IRS offices they can represent clients before.
Enterprise resource planning (ERP): is business management software, typically a suite of integrated applications that an organization uses to collect, store, manage, and interpret data from all business activities and departments.
Enterprise Value: Enterprise Value if effectively the value of the target company as a whole and is an automated calculation performed by the system by adding the Implied Equity Value (from above) and the net debt of the target company. The net debt is based on all interest bearing debt minus cash and cash equivalents.
ENTERTAINER: -- Income of a professional entertainer e.g. a musician, actor or other artiste, or sportsman is, in many cases, treated differently from income of persons carrying on other independent profession.
ENTITY: -- In general for tax purposes, an organization, person or party that possesses separate existence. Options include corporations, partnerships, estates and trusts.
Entity Choice: The choice of entity is a major decision when starting a new business. LLCs and corporations each have relative advantages, with important and varied legal and tax implications.
Entity Ownership: Assets held by an entity, such as a General Partnership, Limited Partnership, Corporation, or Limited Liability Company.
ENVIRONMENTAL TAX: -- Tax imposed for environmental reasons, e.g. to provide an incentive to reduce certain emissions to an optimal level or taxes on environmentally harmful products.
EQUAL TREATMENT: -- General principle of taxation that requires that taxpayers pay an equal amount of tax if their circumstances are equal.
Equal vs. equitable distribution: – “Equal” distribution means that property is divided in equal percentages among heirs. “Equitable” distribution means that property is divided based upon the contributions and needs of the heirs. Both types of distribution may be considered as “fair” – fairness is in the eye of the beholder.
Equal vs. equitable or “fair” distribution: In farm transition or estate planning, an “equal” distribution means that property is divided in equal percentages among heirs. In an equitable or fair distribution, property may be divided based upon the contributions and needs of the heirs; the monetary values of the shares may be different.
Equality Act 2010: The aim of the Equality Act 2010 was to arrange all of the differentcomponents of anti-discrimination law in Great Britain under a single act.The main acts and regulations it covers are; the Equal Pay Act 1970, SexDiscrimination Act 1975, Race Relations Act 1976 and the DisabilityDiscrimination Act 1975.
EQUITABLE INTEREST: -- An equitable interest in an asset is the interest of the beneficial owner; this may or may not be the same person as the legal owner.
EQUITY: --1. The extent of a person's beneficial ownership of a particular asset. This is equivalent with the value of the asset minus the liability to which the asset is subject. 2. Paid-in capital plus retained earnings in a corporation 3. The ownership interest possessed by shareholders in a corporation - stock as opposed to bonds.
EQUITY CAPITAL: -- A method of financing a business where money is received by the issuance of shares in the enterprise.
Equity release: A process by which an owner or owners of a business convert some of their shareholding into cash by securing third party investment.
ERISA: The Employee Retirement Income Security Act is a federal law covering all aspects of employee retirement plans. If employers provide plans, they must be adequately funded and provide for vesting, survivor's rights, and disclosures.
Escheat –: Assignment of property to the state because no verifiable legal owner exists. Typically, where no heir to property exists.
ESOP: -- Employee stock ownership plan
ESOP (employee stock ownership plan): A defined contribution retirement plan in which company contributions must be invested primarily in qualifying employer securities.
Established contact hours: The number of academic credit hours assigned to a course(s) times the number of weeks in a term times the number of terms required to complete the degree.
ESTATE: -- Broadly, all that a person owns, whether real property or personal property, for instance, the estate one leaves at death.
Estate –: Everything of value (all property) that a person owns while living or at the time of death.
Estate Conservation: Activities coordinated to provide for the orderly and cost-effective distribution of an individual's assets at the time of his or her death. Estate conservation often includes the use of wills and trusts.
ESTATE DUTY/TAX: -- See: Death duties
Estate Management: The preparations necessary to manage a person’s financial and healthcare matters during his or her lifetime and to effectively and economically distribute the assets within that estate upon his or her death.
Estate of a deceased person: is what the deceased has left, whether by their will or under the statutory rules on intestacy.
Estate Plan: An Estate Plan helps ensure that your wishes are known and met as you near the end of your life and after your passing. An Estate Plan typically includes a will, general power of attorney, living will, and health care power of attorney. Trust documents and charitable giving are also commonly part of an Estate Plan. In addition to making sure your wishes are carried out after your passing, an Estate plan also allows your surviving family and friends to focus on the grieving process rather than administrative details during a difficult and emotional time. Estate planning is often done in concert with creating a Business Succession Plan.
Estate planning: – making arrangements for what is to happen to a person’s property, personal and business affairs should they become incapacitated and when they die. Usually a term applying to people with large, complex estates, high net worth individuals or business owners. Estate planning involves a collaborative process between what a persons wants, their wishes and advice from their professional advisers such as lawyers, accountants and financial advisers, in formulating an overall plan. A will is an important central part of the
Estate settlement: – Another term for the probate process.
Estate Tax: Federal and/or state taxes that may be levied on the assets of a deceased person upon his or her death. These taxes are paid by the deceased person’s estate rather than his or her heirs.
Estate Tax Exclusion (credit): A portion of a decedent estate not subject to estate tax (sometimes referred to as a “credit”).
ESTIMATED ASSESSMENT: -- For income tax purposes, where the records kept, particularly by small traders, are inadequate for a precise calculation of tax due, it may be necessary for the taxable income or profits to be calculated by the tax authorities on the basis of an estimate.
ESTOPPEL: -- Rule under which one is precluded and forbidden by law to speak against his own act or deed. If a certain position has been taken, another person has relied on that, and you are aware of that reliance, there is often an estoppel against you arguing the contrary to your original position in a court proceeding.
EUROBOND: -- International bond issued by a company in a market other than its domestic market. Eurobonds may take the form of loans, debentures or convertible debentures, and maybe designated in any currency.
EURODOLLARS: -- Dollars originally deposited in US banks that are acquired by persons resident outside the United States and held abroad, mainly in Europe. Eurodollars are used by foreign banks as a method of financing loans to other local or foreign banks or to commercial borrowers.
EUROPEAN COMMISSION: -- The Commission is the executive institution of the European Union charged with the task of administering all policy within the Union.
EUROPEAN UNION: -- See: Treaty on European Union
Evaluation of training: is a multi-level, systematic method for gathering information about the effectiveness and impact of training programs. Results of the measurements can be used to improve the offering, determine whether the learning objectives have been achieved, and assess the value of the training to the organization.
EVASION: -- A term that is difficult to define but which is generally used to mean illegal arrangements where liability to tax is hidden or ignored, i.e. the taxpayer pays less tax than he is legally obligated to pay by hiding income or information from the tax authorities.
EXAMINATION: -- The checking of a taxpayer's tax return, accounts, self-assessment calculations, etc. The process may or may not include an audit of the taxpayer's own books.
Exchange: A method of exchanging insurance-related assets without triggering a taxable event. Cash-value life insurance policies and annuity contracts are two products that may qualify for a 1035 exchange.
EXCHANGE CONTROL: -- Restriction of the amount of a particular foreign currency that can be bought or sold
EXCHANGE OF INFORMATION: -- Most tax treaties contain a provision under which the tax authorities of one country may request the tax authorities of the other country to supply information on a taxpayer. Information may only be used for tax purposes in the receiving country and it must be kept confidential, i.e. it can only be disclosed to the persons or authorities concerned with the assessment or collection of taxes covered by the treaty.
Exchange-Traded Funds (ETFs): A share of an investment company that owns a block of shares selected to pursue a specific investment objective. ETFs trade like stocks and are listed on stock exchanges and sold by broker-dealers. Exchange-traded funds are sold only by prospectus. Please consider the charges, risks, expenses, and investment objectives carefully before investing. A prospectus containing this and other information about the investment company can be obtained from your financial professional. Read it carefully before you invest or send money.
EXCISE TAX: -- A tax imposed on an act, occupation, privilege, manufacture, sale, or consumption.
EXCLUSIONS: -- Term used to describe income which is exempt, i.e. not included, in the calculation of gross income for tax purposes.
Exclusivity Period: The exclusivity period in a sale process is where the PE firm starts paying hard cash for external consultants to try and confirm what they have found. See
Execute –: shortform lawyer language meaning to follow all the legal formalities as the law requires in a particular situation to make the document legally valid and operative to take it into effect. Depending on the context it may be only a signature is required, but not in others. For example someone executing their will means both signing and declaring it is their last will in the presence of two witnesses.
Executive Bonus Plan: The employer pays for a benefit that is owned by the executive. The bonus could take the form of cash, automobiles, life insurance, or other items of value to the executive.
Executive Coach: provides a safe, structured, and trustworthy environment in which to offer support for senior managers or leaders within an organization.
Executive Coaching: A confidential, one-on-one partnership between a leader and a coach to improve management or leadership performance and development.
Executive Development Plan: A detailed guide of developmental experiences to help SES members, through participation in short-term and longer-term experiences, meet organizational needs for leadership, managerial improvement, and organizational results.SES members are required to prepare, implement, and regularly update an EDP as specified by 5 CFR 412.401
Executive Talent Pool: Creating an executive talent pool is the process of sourcing eligiblecandidates for executive roles. Developing talent pools used to be leftsolely to the recruitment industry, however many organisations are nowwisening up to the fact that they can create their own talent pools, forexample by using social media sites such as LinkedIn.
Executor: – A person named in a will to carry out its instructions; if male, the person is called an executor, and if female, the person is called an executrix. It may be referred to as the administrator or personal representative.
Executor –: A person appointed by will to manage, administer, distribute and finalise a deceased estate in accordance with the terms of the will. The executor is also responsible for making arrangements to dispose of the body. An executor maybe one or more individual persons, see
Executor de son tort: – meaning ‘of his/her own wrong’. Refers to when a person, who is not named in the will as executor, nor appointed as an administrator, takes it upon themselves to carry out executorial and administrative functions in regard to a deceased estate. In other words they in effect take on the office of executor/administrator by interfering with the deceased’s assets without having authority to do so. The person who does this does not have the proper legal authority, and so are liable to account to the beneficiaries and creditors of the deceased estate.
Executor’s deed: - A deed used to convey the real property of a deceased person.
EXEMPTION METHOD: -- See: Foreign tax relief
EXEMPTIONS: -- Tax laws frequently provide specific exemptions for persons, items or transactions, etc. which would otherwise be taxed. Exemptions may be given for social, economic or other reasons.
Exit: Occurs when a financial institution, such as private equity firm or venture capitalist realizes its investment in a company. This is usually achieved by selling its stake to a trade buyer or another financial buyer, or by floating the company on the stock exchange.
Exit Interview: An exit interview is conducted with an employee who is leaving anorganisation. The purpose of such an interview is to glean feedback fromthe departing employee in order to improve aspects of the organisation,for example, employee retention.
Exit strategy: A plan which sets out how the investor and management team will sell their shareholdings in order to generate maximum return. A strategy can be driven by multiple factors, from the investment climate to industry trends to the types of likely buyers that exist for a business. Typical exit strategies involve ‘trade sales’, ‘secondary buy-outs’ and ‘initial public offerings’.
Ex-nuptial,: being the term used nowadays to refer to the situation where a child is born to parents who are not married. The child is said to have been born out of wedlock, or is an ex-nuptial child.
EXPATRIATE: -- Persons who have left their country and live abroad.
EXPATRIATION RULES: -- Rules under which a taxpayer continues to be subject to tax when he relinquishes his residence or his citizenship in order to avoid tax.
EXPENSES: -- Costs that are currently deductible, as opposed to capital expenditures, which may not be currently deducted but must be depreciated or amortized over the useful life of the property.
Experience: Experience is often directly related o the amount of time someone hasspent working and can come as either specific or transferable experience.For young people looking to gain employment experience is often a keyfactor, yet many do not have it. Work experience and placements aretherefore highly recommended.
Experiential learning: is a specific learning process in which learners participate in an activity, review the activity, identify useful knowledge or skills that were gained, debrief what was learned, and transfer what was learned to the workplace. It is also known as discovery learning.
EXPORT DUTY: -- Tax levied on exports of basic commodities entering into world trade, such as rubber, copper, palm oil, sisal, tea, cocoa and coffee
EXTENDED LIMITED TAX LIABILITY: -- Principle according to which certain taxpayers (i.e. those subject to individual income tax, net worth tax and succession duty) who leave a tax jurisdiction and move to a low-tax country are subject to taxation in the former country of residence for a certain period of time after the move.
Exterior Finance: The mechanics or “hard facts” aspects of managing money, such as investment returns, bank statements, and budgets.
External Coach: A professional coach who is either self-employed or partners with other professional coaches to form a coaching business.
Succession Planning: F
Facilitation: refers to the trainer’s role in the learning process—helping learners acquire, retain, and apply knowledge and skills. May also be referred to as training delivery.
FACTORING: -- Financial transaction whereby an enterprise sells its debt-claims to a third party in order to obtain cash (although less than the full amount of the debt). The third party then assumes responsibility for the administration and collection of the debt on the due date for its own account.
Fair Market Value: The dollar value that a willing purchaser may pay for an ownership interest from a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of the facts.
Family arrangement: – is an agreement which sets out how property in the family is to be distributed.
Federal Estate Tax.: The tax paid to the federal government by the personal representative or trustee of a person’s estate or trust out of the estate or trust assets.
Federal Income Tax Bracket: A series of income ranges within which a taxpayer’s income is taxed at a certain rate. Taxpayers pay the tax rate in a given bracket only for that portion of their overall income that falls within the bracket’s range.
FEDERAL REGISTER: -- A daily publication by the U.S government that prints the regulations of the various governmental agencies.
Federal Reserve System (The Fed): The United States’ central bank. The Federal Reserve System consists of a series of 12 independent banks that operate under the supervision of a seven-member, federally appointed board of governors. The Fed strives to maintain maximum employment, stable price levels, and moderate long-term interest rates. It establishes and enforces the regulations banks, savings and loans, and credit unions must follow. It also acts as a clearing house for certain financial transactions and provides banking services to the federal government.
FEDERAL TAX: -- In federal states, taxation may exist on two levels: taxation by the federation or confederation, and taxation by the state or provinces.
Federally Mandated Training: Mandatory training for all employees Governmentwide or in some cases, groups of employees across Federal agencies and departments
FEE: -- Fees charged by central or local governments can be distinguished from taxes when they are charged as payments for the supply of particular services by the authorities. Fees are usually not considered taxes when listing taxes to be included in a double tax treaty.
Fee simple property ownership: – Ownership by one person who can buy, sell, give, or mortgage the asset as he or she sees fit. When the owner is married, real estate is subject to a spouse’s dower rights and, therefore, any transactions require the spouse’s signature. At death, the fee simple property becomes part of the probate estate.
Fee-based Financial Planners and Investment Advisers: Financial planners whose income is a combination of commissions on financial products they sell and fees for financial planning. While these advisers may have a fiduciary obligation to their client, they have a significant conflict of interest when most of their revenue comes from commissions earned on the financial products they sell.
Feedback: is advice or information from one person to another about how useful or successful an event, process, or action is. In coaching and all TD activities, learners receive feedback regarding their progress, which helps with learning retention and behavior change.
Fee-Only Financial Planners and Investment Advisers: Financial planners whose compensation is derived solely from the client without any third-party incentives, commissions, sales quotas, or other mysterious agendas that are typically incurred when working with a fee-based or commission-only advisor.
Fiduciary: The legal obligation of a professional adviser, such an attorney or a CFP®, to act in clients’ best interests. Most financial product salespeople have no fiduciary obligation to their customers and have significant conflicts of interest.
Fiduciary.: A person in a position of trust or confidence. The fiduciary is bound by a duty to act in good faith. Some examples of fiduciaries include trustees, executors, personal representatives and agents under powers of attorney.
FIELD AUDIT: -- An examination of a tax return by tax authorities at the taxpayer's place of business.
FIFO: -- Method of valuing inventory on the basis of "first in, first out", where goods or materials purchased first are regarded as those which are sold first.
FINAL TAX: -- Under tax treaties the withholding tax charged by the country of source may be limited to a rate lower than the rate which would be charged in other circumstances - this reduced rate is then the final tax in the country of source.
FINANCE COMPANY: -- A company, usually a wholly owned subsidiary, which borrows funds from within or outside a group of companies and onlends the funds to affiliates. A finance company is, in many cases, established in a low or no tax jurisdiction.
FINANCE LEASE: -- Lease where the lessor is considered only as a financier. The lessee is regarded as the owner of the leased assets. Cf. Operating Lease
Financial Adviser: A term with no precise industry definition that can be used by financial planners, investment managers, and sellers of financial products.
Financial Aid: Loans, grants, scholarships, and work-study programs provided by federally and privately funded sources to enable students to attend college.
Financial Coach: A professional with training and certification in coaching as well as knowledge of exterior finance, who can help clients establish and work toward financial goals.
Financial Coaching: The process of working with a financial coach to define and work toward financial goals. Financial coaching focuses primarily on the future, while financial therapy explores and resolves issues from the past.
Financial Due Diligence: A report written by accountants on the financial aspects of your business. They will analyse your past accounts, your projections and assumptions and may point out things like customer concentration or any risks that they see. They check you’ve paid your taxes and produce a financial model of the business that will show sensitivities and a range of outcomes.
Financial Industry Regulatory Authority (FINRA): FINRA is an independent regulator that oversees all securities firms doing business in the U.S. FINRA seeks to protect investors by making sure the securities industry operates fairly and honestly.
Financial Planner: A practicing professional who helps people deal with various personal financial issues through proper planning. This label can be used by many financial advisers and financial product salespeople who may not actually be engaged or trained in the profession of financial planning. (See Certified Financial Planner®.)
Financial Planning: Comprehensive advice and assistance to a client for the purpose of meeting the client’s financial needs and life goals. This includes, but is not limited to, these major areas: cash flow management, education planning, retirement planning, investment planning, risk management and insurance planning, tax planning, estate planning and business succession planning (for business owners).
Financial Sponsor: Yet another name for your PE investor. They are interested in your business purely for financial reasons. Contrast with a Trade acquirer which might be interested in you for strategic reasons.
Financial Statement: A formal record of the financial activities of a business, person, or other entity. For a business, financial statements typically include a balance sheet, a profit and loss statement, and a cash flow statement.
Financial statements: – recording all financial transactions during the period of administering the deceased’s estate must be kept by the executor/s. When the administration has been completed the executor/s then provide each beneficiary with a copy of the financial statements.
FINANCIAL STRUCTURE: -- The makeup of the right-hand side of a company's balance sheet, which includes all the ways it assets are financed.
Financial Therapist: A professional with formal education or certification in counseling as well as financial planning. With this combined approach, informed by both therapeutic and financial competencies, financial therapists are equipped to help people reach their financial goals by thoughtfully addressing financial challenges, while at the same time, attending to the emotional, psychological, behavioral, and relational hurdles that are intertwined.
Financial Therapy: A process informed by both therapeutic and financial competencies that helps people think, feel, and behave differently with money to improve overall well-being through evidenced-based practices and interventions.
FIRST IN, FIRST OUT (FIFO): -- See: FIFO
First-to-Die Life Insurance: Joint life insurance taken out on the lives of two or more people that pays its death benefit when the first insured person dies.
FISCAL DOMICILE: -- See: Domicile, fiscal
FISCAL NULLITY DOCTRINE: -- Common law doctrine used in the UK in cases of avoidance of tax, whereby certain transactions are ignored for fiscal purposes. Cf. Substance over form doctrine.
FISCAL POLICY: -- Part of economic policy which relates to taxation and public expenditure.
FISCAL RESIDENCE: -- See: Residence
FISCAL TRANSPARENCY: -- "Looking through" an entity and attributing profits and losses directly to the entity's members. The profits of certain forms of enterprises are taxed in the hands of the members rather than at the level of the enterprise. Often occurs in the case of a partnership for example.
FISCAL YEAR: -- Any 12-month period which is set for accounting purpose of an enterprise.
Fixed Annuity: A contract with an insurance company that guarantees investment growth at a fixed interest rate as well as current or future payments in exchange for a premium or series of premiums. The interest earned on an annuity contract is not taxable until the funds are paid out or withdrawn. The guarantees of an annuity contract depend on the issuing company’s claims-paying ability. Annuities have fees and charges associated with the contract, and a surrender charge also may apply if the contract owner elects to give up the annuity before certain time-period conditions are satisfied.
FIXED ASSETS: -- Assets that are held by an enterprise either continuously or for a comparatively long period of time, generally more than one year
FIXED BASE: -- This term was used in the OECD and UN model tax treaties in the context of independent personal services, but the former Article 14 has been removed from the OECD Model and these issues are now generally dealt with under Article 7, dealing with business profits attributed to permanent establishments. It denotes a centre of activity of a fixed or permanent character from which such services can be carried out such as a physician's consulting room. The fixed base provision attributes the right to tax income from independent personal services to the "other" country (i.e. the source country) if the taxpayer has a fixed base available to him in that country and income is attributable to that fixed base.
FIXED INCOME: -- Income which does not fluctuate over a period of time, such as interest on bonds and debentures, or dividends from preference shares as opposed to dividend income from ordinary shares.
Fixed-Rate Mortgage: A mortgage with a set interest rate that will not change over the life of the loan.
FLAG OF CONVENIENCE: -- The flag of ship is the flag of the country where it is registered. This term is used in international shipping where a ship's country of registration is selected on the basis of country's legal requirement and tax regime.
FLAT TAX: -- A tax applied at the same rate to all levels of income. It is often discussed as an alternative to the progressive tax.
FLOORS: -- The lower limits on tax benefits and detriments, e.g. in medical expense. A taxpayer must spend more than the floor for a deduction, and only the amount above the floor is deductible.
FLOW-THROUGH ENTITY: -- See Fiscal transparency
FOB VALUE: -- FOB denotes "free on board". FOB value is value of goods excluding carriage, insurance and freight, i.e. roughly speaking, the domestic price in the country of origin.
FORCE OF ATTRACTION: -- Concept under which a permanent establishment is taxed by the country in which it is located not only on the income and property, but also on all income derived by its foreign head office from source in, and all property owned by the foreign head office situated in, the country where the permanent establishment is located. The OECD model treaty does not allow application of it.
Forced succession: – in some countries the legal system prescribes who in the family will inherit the property and in what proportions so that the will-maker has little or no choice in who will inherit their property.
Foreclosure: The legal process under which a creditor seizes the property of a borrower who has not made timely payments on his or her debt.
FOREIGN CURRENCY FORWARD: -- See Forward contract. This contract serves the same purpose as a foreign currency futures contract, except that it is not standardized and entered on the informal, interbank market rather than on a formalized commodities exchange.
FOREIGN CURRENCY FUTURES: -- Exchange traded contract for the delivery of a standardized amount of foreign currency on a specific future date. The price for the foreign currency is agreed on the day the contract is bought or sold. Unlike forward contracts, futures are tradable, reflecting the standardization of contract size, specification and delivery date.
FOREIGN CURRENCY OPTION: -- Contract with an option to buy/sell foreign currency. See: option.
FOREIGN CURRENCY SWAP: -- An agreement under which two or more parties agree to exchange specified amount of two different currencies for a defined period. Over the term of the agreement, the parties exchange fixed or floating rate interest payments in their swapped currencies.
FOREIGN EXCHANGE CONTROL: -- See: Exchange control
FOREIGN EXCHANGE TAX: -- Special tax imposed on transactions involving sales of foreign exchange by domestic banking institutions and authorized exchange brokers.
FOREIGN TAX CREDIT (FTC): -- See: Credit, foreign tax
FOREIGN TAX RELIEF: -- Relief from domestic tax on income from abroad which has already suffered foreign tax. Generally speaking, two approaches are taken to foreign tax relief, i.e. the credit method or the exemption method.
FOREIGN-SOURCE INCOME: -- Generally income realized from countries outside the country of residence of the taxpayer.
FORFAIT: -- In a number of countries tax is sometimes levied on an estimated taxable base (forfait), particularly in respect of the imposition of income tax or turnover tax on small enterprises.
Formal learning: is a planned learning program that derives from activities within a structured learning setting and includes instructor-led classroom, instructor-led online training, certification programs, workshops, and college courses. There is a curriculum, agenda, and objectives that occur within a pre-established timeframe.
Formal probate proceedings –: Proceedings conducted before a judge with notice to interested people for probate of a will or appointment of a personal representative.
Formative evaluation: occurs throughout the design of any talent development solution. Its purpose is to improve the draft initiative and increase the likelihood that it will achieve its objectives. For example, in performance improvement the assessment measures the progress throughout the HPI model, such as a client’s expectations and whether the root cause has been identified.
FORMS, TAX: -- See: Tax form
FORMULA APPORTIONMENT: -- See: Unitary tax system
FORMULATORY APPROACH: -- See: Unitary tax system
FORWARD CONTRACT: -- Contract for the delivery of an amount of asset (e.g. foreign currency, securities, commodities) on a specific future date.
FRANCHISE TAXES: -- Nearly all states in the US levy an annual franchise tax on resident and non-resident corporations for the privilege of the right to do business in that state.
FRAUD: -- Tax fraud is a form of deliberate evasion of tax which is generally punishable under criminal law. The term includes situations in which deliberately false statements are submitted, fake documents are produced, etc.
FRINGE BENEFITS: -- Benefits supplementing normal wages or salaries. Fringe benefits may be given in the form of a money allowance, e.g. a holiday bonus or in the form of benefits in kind, e.g. free accommodation. Although most countries tax the benefit of employer-provided automobiles and accommodation, the tax treatment of other fringe benefits varies considerably.
FRIVOLOUS POSITION: -- A tax position that is knowingly advanced in bad faith and is patently improper.
Front-End Load: A sales fee paid at the time an investment is purchased. This fee is deducted from the investment—thus lowering the size of the investment.
FRONTIER WORKERS: -- For tax purposes, a frontier worker is a person who commutes across a border (e.g. on a daily basis) between his place of residence and his place of employment.
FRONTING: -- Term used to describe the practice of interposing a third party in a transaction so as to circumvent transfer pricing legislation.
FRUIT AND TREE DOCTRINE: -- A judicial doctrine that an individual who earns income from property of services may not assign such income to another person for tax purposes.
FTC: -- See Foreign tax credit
FUNCTIONAL ANALYSIS: -- An analysis of the functions performed (taking into account assets used and risks assumed) by associated enterprises in controlled transactions and by independent enterprises in comparable uncontrolled transactions.
Functional Area: A logical grouping of Job Families that represents a function of the organization, such as Marketing or Production
Fundamental Analysis: A method of evaluating securities that examines financial and economic factors—such as the current finances of a company and the prevailing economic environment—to determine whether the company’s future value is accurately reflected in its current stock price.
FURNISS V. DAWSON: -- This case is 1984 UK case, decided by the House of Lords, which is generally considered to be a landmark case. It made ineffective tax avoidance schemes which have no commercial purpose other than the avoidance of tax.
Future Interest.: A property interest which cannot be currently possessed, used or enjoyed.
Future Readiness: refers to intellectual curiosity and constant scanning of the environment to stay abreast of forces shaping the business world, employees and their expectations, and the talent development profession and to handle the changes in how work is done in the years ahead.
Future Skills Needs: Using labour market information to predict future skills needs can help toimprove decision making in areas such as investing in training andidentifying courses that will best support employee skills needs. However,it is important that employers do not solely rely on forecasting methodsbecause skill needs are driven by a variety of factors including legislation,environment and technological advances.
FUTURES CONTRACT: -- An agreement between a buyer and seller to exchange particular goods (e.g. securities or commodities) for a particular price at a future date as specified in a standardized contract common to all participants in a market on an organized futures exchange.
Futures Contracts: Investment contracts to buy or sell given quantities of a commodity or other asset at a given price on a designated date.
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HABITUAL ABODE: -- In the context of the tie-breaker rule of the OECD model tax treaty, habitual abode is one of the criteria used to resolve the problem of dual residence. It refers to the period of time a taxpayer spends in each country.
Hackathon: is an event that started in technology, where a large group of people with expertise from multiple professions gather to quickly create new software or hardware. The event has spread to other professions, occurring when large numbers of people gather for a day or more to collaborate in small groups to work on a project or create a new approach or venture.
Hard Data: consists of objective quantitative measures that can be stated in terms of frequency, percentage, proportion, or time.
HARDSHIP CLAUSE: -- Discretionary power of the tax authorities to mitigate any harsh results of the tax law.
HARMONIZATION OF TAX, EEC DIRECTIVE: -- Term usually used to refer to the process of removing fiscal barriers and discrepancies between the tax systems of the various countries comprising the European Union. To this end the EU has issued directives in the area of indirect and direct taxation.
HEAD OFFICE EXPENSES: -- Where an enterprise with its head office in one country operates through a branch or other permanent establishment in another country, some expenses incurred by the head office, e.g. for general management and administrative expenses or the cost of specific services provided to the permanent establishment, may be deducted in computing the taxable profits of the permanent establishment.
Health Care Advance Directive: . A comprehensive health care document that incorporates the appointment of an individual, the “Health Care Agent” to make comprehensive health care decisions, and instructions regarding advance health care decisions the signatory would, or would not, want. Can also deal with organ donation, disposition of body, visitation issues, religious concerns concerning health care decisions and the rights of individuals to receive information. In Maryland this is referred to as an “Advance Directive,” while in Virginia it is called an “Advance Medical Directive.”
Health Care Decisions Directive: . Can be called by any number of titles or names, these documents allow you to state your wishes regarding what types of medical measures you prefer to have, or have removed or withheld, if you are unable to decide these things for yourself. They often deal with the persistent vegetative state, terminal condition or other end of life situations. This is usually included within a Health Care Advance Directive.
Health care POA: - grants powers related to health-care decisions.Pretermitted child – One who may, under certain circumstances, become an heir by birth or adoptionsubsequent to the date of execution of a testator’s will.
Health Care Power of Attorney: . A document that appoints an individual to make health care decisions when the grantor of the power is incapacitated. It may or may not also list advance decisions or other health care intentions. This is usually included within a Health Care Advance Directive, but in some places, such as the District of Columbia, it is a “Durable Power” that includes the information and directions of a Health Care Advance Directive.
Health Savings Account (HSA): An account that offers individuals covered by high-deductible health plans a tax-advantaged means to save for medical expenses. Within certain limits, funds contributed to the account are not subject to federal income taxes. Unlike Flexible Spending Accounts (FSAs), funds can be rolled over from year to year if not spent.
Hedging: Reducing investment risk by including strategies such as short selling and futures contracts in a diversified portfolio.
HEDGING TRANSACTION: -- Transaction where a person tries to protect himself against price, interest rate or foreign exchange rate fluctuations, for example, by buying or selling commodities or currencies using derivative contracts such as forwards, futures, options and swaps.
Heir: – A person entitled by law to inherit part or all of the estate of an ancestor who died without leaving a valid will.
Heir.: A person entitled to inherit a portion of the estate of a person who has died without a Will.
Hereditament: – Latin origin meaning inheritance.
HIDDEN RESERVES: -- Reserves which are not disclosed on the balance sheet of an enterprise, either by overvaluing debts or undervaluing assets.
Hidden Skills: Hidden skills are often not job specific skills, but transferable skills thatyou have gained throughout your life. Hidden skills say a lot about aperson, and although they are often not job specific they can say a lotabout how a person will fit into an organisation.
Hidden Talent: Are talents and skills that individuals often do not realise that they have.They are general life skills that you pick up throughout your journey, suchas people skills and empathy. Hidden talents also include naturalaptitudes for tasks that you did not realise you had. Youth unemploymentis arguably so high at the moment because far too many have notexposed their hidden talents.
HIDDEN TAX: -- Indirect tax paid by the consumer without his knowledge.
High Performance Working: This relates to the way that people are managed whilst at work. It hasrecently emerged that placing people and their skills at the centre willsecure greater employee involvement and commitment to theorganisation, leading to high performance working.
Higher Level Skills: Higher Level Skills are generally viewed as being at National QualificationFramework (NQF) Level 4 or above and are often associated with gaininghigher education qualifications.
HISTORICAL COST: -- Amount expended in obtaining an asset at the time of acquisition, i.e. the purchase price and associated costs.
Hockey Stick: Used as in “hockey stick projection” or “hockey stick forecast”.A surprising number of IM’s include a revenue and or profit forecast which includes a chart that shows a flat line followed magically by a sharp upturn, looking just like a hockey stick.The company being sold is normally at the end of the flat line, just about to shoot up. If your forecasts look like this then don’t worry, just lean in to it. PE firms are used to seeing them. In fact if your IM doesn’t include a hockey stick somewhere they’ll probably be suspicious.
HOLDING: -- A decision of a court
holding area: An area on the Talent Review dashboard to hold workers not rated by their managers, rated using nonstandard rating models, or removed from the box chart during the talent review meeting.
HOLDING COMPANY: -- Company whose main purpose is to hold substantial shares of other companies.
HOLDING PERIOD: -- The length of time that an investment is owned or expected to be owned.
Holograph will –: when a person has hand written their whole will.
Holographic Will: A will entirely in the handwriting of the testator. Without witnesses, holographic wills are valid and enforceable only in some states.
Home Equity: The real value of a home after all liabilities have been paid. Thus a home worth $300,000 with a $200,000 mortgage would have $100,000 in equity.
HOMESTEAD: -- A house and surrounding land owned and used as a dwelling.
HORIZONTAL EQUITY: -- Doctrine which holds that similarly situated taxpayers should receive similar tax treatment, e.g. taxpayers who earn the same amount of income or capital should be accorded equal treatment.
HOUSE WAYS AND MEANS COMMITTEE: -- The committee of the US House of Representatives that introduces most tax provisions.
HR: Abbreviation for human resource.
Human capital: describes the collective knowledge, skills, competencies, and values of the people in an organization.
HUT TAX: -- Type of poll tax levied on inhabited dwellings or huts generally at an early stage in the development of an economy when it is not feasible to introduce an income tax.
HYBRID ACCOUNTING METHODS: -- Term which refers to the situation where a taxpayer used a combination of accounting methods (such as accruals basis accounting or cash basis accounting) for different items of income.
HYBRID DERIVATIVE: -- Financial instrument which has the characteristic of more than one type of instrument, i.e. a swap plus an option.
HYBRID ENTITY: -- Entity that is characterized differently in two or more jurisdictions, for example, an entity that is treated as a partnership in one jurisdiction and as a corporation in another.
HYBRID INSTRUMENT: -- See: Hybrid derivative
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GAAP: -- Generally Accepted Accounting Principles are the rules and practices required to be followed in keeping financial records and books of account.
Gagné's Nine Events of Instruction: were developed by Robert Gagné, a pioneer in the field of instructional design. The nine events are meant to help ensure that learning occurs—from gaining attention and informing learners of the objective to assessing performance and enhancing retention and transfer.
GAIN, CAPITAL: -- See: Capital gain
Gamification: is the application of typical elements of game playing (point scoring, competition, rules of play) to the design of development initiatives. It is used as either the optimal learning approach or as a technique to encourage engagement.
GEARING: -- Term broadly used in the context of a company's debt/equity ratio. A company is highly geared if the ratio of debt to equity is high. Sometimes referred to as capital gearing or leveraging.
GENERAL PARTNER: -- In a partnership, a partner whose liability is not limited. All partners in an ordinary partnership are general partners. A limited partnership must have at least one general partner and at least one limited partner.
General Partner (GP): Another name for your PE house. The principles in charge of your PE firm might call themselves the General Partners.
GENERAL PARTNERSHIP: -- See: Partnership
General warranty deed: - An assurance or guarantee that something is true as stated, making it thehighest quality title. A deed that usually contains the covenants of seizing, quiet enjoyment,encumbrances, further assurance and warranty forever.
GENERATION-SKIPPING TAX: -- Tax imposed to prevent the avoidance of transfer tax (i.e. estate tax and gift tax) over successive generations.
Gift: The voluntary transfer of assets under which the giver receives no compensation and retains no interest in his or her gift.
Gift –: A voluntary transfer of property – title and control – for which nothing of value is received in return.
GIFT CAUSA MORTIS: -- A transfer of property by a person who faces impending death. The donee thereby becomes the owner of the property, but on the condition that the gift is revoked if the donor does not die.
Gift deed: - A deed executed and delivered without consideration (a deed that states “love andaffection” as the consideration).
GIFT INTER VIVOS: -- A gratuitous transfer of property made during the transferor's (donor's) lifetime. In many countries the gratuitous transfer of property is subject to a gift tax.
Gift Tax: A tax the federal government and some states levy on the transfer of property as a gift. Generally gift taxes increase with the amount of the gift and are paid by the donor.
Gift Tax Annual Exclusion.: The provision in the tax law that exempts from federal gift taxes the first $14,000 (as adjusted for inflation) in present-interest gifts a person gives to each recipient during a year.
Gift Tax.: Tax on gifts generally paid by the person making the gift rather than the recipient. This tax is rarely paid and only due where the person making the gift exceeds their life time exemption of over 5 million dollars.
Gift Taxes: A federal tax levied on the transfer of property as a gift. This tax is paid by the donor. For 2019 and 2020, the first $15,000 a year from a donor to each recipient is excluded from tax. Most states also impose a gift tax. The gift tax exclusion is indexed for inflation.
Gifting: – An estate planning tool used to implement an estate plan by making gifts to intended successors of assets owned by the person/people making the gifts. A gift is only possible while the donor is alive.
Gig Economy: is the workforce environment where temporary, independent, and short-term engagements are routine.
Give, devise and bequeath –: in modern will drafting the use of the single word ‘give’ is preferred over this phrase or “devise and bequeath”. See the About the plain language series on “Give, devise and bequeath”, New South Wales Law Society Journal, May 2014 p. 31.
GLOBAL FORMULARY APPORTIONMENT METHOD: -- See: Global method
GLOBAL HEDGING: -- A risk-management strategy to balance positions of different business units or with unrelated third parties.
GLOBAL INCOME TAX: -- Income tax that aggregate income from all sources at the individual (or family unit) level. The income is then taxed at a single progressive rate.
GLOBAL METHOD: -- Under the global method, the profits of each member of a multinational enterprise (MNE) are not calculated on the basis of arm's length dealings, but rather the total profit of the enterprise is allocated to the members of the multinational enterprise on the basis of, for example, the turnover of each member, the expenses incurred by each member or the labour cost of each member.
GLOBAL TRADING: -- Term used to describe transactions carried out by, inter alia, investment banks and securities dealers, involving financial instruments, financial services and financial goods. Also known as 24-hour trading since the transactions are carried out continuously during a day in financial markets worldwide.
Goal: refers to an end state or condition toward which human effort is directed.
GOING CONCERN: -- A business which is actually operating, e.g. at the time of takeover. The advantage of taking over a business as a going concern (if it is operating profitably) is usually recognized by a payment for goodwill as well as for other assets.
GOING CONCERN VALUE: -- The element of value that attaches to property as a result of the ability of a trade or business to continue to operate and generate income after a transfer of ownership.
GOOD FAITH: -- "Good faith" denotes a state of mind, whereby a person honestly and truly believes that certain facts or circumstances are as he says they are.
GOODS AND SALES TAX VAT: -- style multi-stage sales tax levied on purchases (and lessees). Sellers (and lessors) are generally responsible for collection.
GOODWILL: -- Intangible asset which consists of the value of the earning capacity, location, marketing organization, reputation, clientele, etc. of a trade or business. Goodwill can be transferred for a consideration to another entrepreneur upon the sale of the business as a going concern.
GORDON REPORT: -- 1981 report submitted to the US Treasury, entitled "Tax Havens and Their Use by United States Taxpayers - An Overview"; it explains the use of US taxpayers make of tax havens, existing anti-abuse measures and proposals for measures to counter such activities.
Government Employees Training Act (GETA), Public Law 85-507: Enacted in 1958, established a flexible framework for Federal agencies to plan, develop, establish, implement, evaluate, and fund training and development programs designed to improve the quality and performance of their workforce and achieve their mission. GETA is codified in chapter 41 of title 5, United States Code
Government Facility: Property owned or substantially controlled by the Government and the services of any civilian and military personnel of the Government
GRACE PERIOD: -- The period following the due date of taxes during which legal action for recovery of delinquent taxes will not be instituted and interest will not commence to run.
GRADUATED RATE: -- System where the rate of tax increases on marginal amounts as the amount of taxable income rises. Synonym for progressive rate.
GRANDFATHER CLAUSE: -- Clause temporarily preserving legislation which exists at the time a law is modified or a (tax) treaty is concluded (or modified).
Grant of Probate: is an official document certified and issued by the Supreme Court as evidence that the Court has recognised and confirmed the authority of the person/s named as executor/s to go ahead and deal with the deceased estate according to the deceased’s will, and distribute their assets and property, both real and personal. This must take place first before the executor can obtain title to the property forming the deceased estate, that is before “calling in ” the deceased’s assets.
Grantor: The person who conveys assets to a trust (aka “Trustor) or to others by will (aka “Testator”) or by a deed.
Grantor –: The person placing property in a trust.
Grantor Retained Annuity Trust (GRAT): . A Grantor Retained Annuity Trust or GRAT is an estate planning technique that minimizes tax liability existing when intergenerational transfers of estate assets occur. Under these plans, an irrevocable trust is created for a certain term or period of time. If the asset in the trust increases enough, the increase is distributed to the beneficiaries in a tax advantaged way, while the original asset is returned to the Grantor.
Grantor Retained Income Trust (GRIT): . A Grantor-retained income trust or GRIT is an irrevocable trust established in a written trust agreement whereby the grantor transfers assets but retains the income from or the use of these assets for a stipulated period of time.
GREEN CARD: -- Entry document issued by the US immigration and Naturalization Service (INS) that permits foreign nationals to live permanently in the US and undertake employment.
GREEN CARD TEST: -- A test in the US to determine residence of an alien individual, i.e. an alien is considered resident if at any time during the calendar year he is a lawful permanent resident of the US under the immigration laws.
Gross estate: – For federal estate tax purposes, the total value of all property real or personal, tangible or intangible that a decedent had owned or had control over at the time of death.
Gross Estate.: The total value of an individual’s property for state or federal estate tax purposes.
GROSS INCOME: -- Gross receipts, whether in the form of cash or property, of the taxpayer received as compensation for independent personal services, and the gross receipts of the taxpayer derived from a trade, business or services, including interest, dividends, royalties, rentals, fees or otherwise.
GROSS INCOME, TAXES ON: -- In some countries income taxes are levied on gross income (usually at low rates) without deduction for expenses.
GROSS MARGIN: -- Ratio of gross profits to gross revenue.
Gross Monthly Income: Total monthly income generated from all sources before taxes and other expenses are considered.
GROSS PROFIT RATIO: -- Ratio of gross profit to the sales of a business or, alternatively, to the adjusted purchases or "goods consumed" during the accounting period.
GROSS PROFITS: -- The gross profits from a business transaction are the amount computed by deducting from the gross receipts of the transaction the allocable purchases or production costs of sales, with due adjustment for increases or decreases in inventory or stock-in-trade, but without taking account of other expenses.
GROSS PROFITS TAX: -- Tax imposed usually at low rates on the gross receipts of a business
GROSS UP: -- Add back the amount of tax which has been paid to the value of property or other income received. The term includes the process by which corporation add credits (e.g. imputation credits or foreign tax credits) received to net income received before calculating their tax liabilities.
Group Dynamics: refers to the interaction of individuals working or learning together and includes communication, goal-setting, decision making, providing leadership, and resolving conflict.
Group Life Insurance: Life insurance that insures all the members of a specific group, most often the employees of a specific company or the members of a professional association.
GROUP SERVICE CENTER: -- Term used in the 1984 OECD Report on Transfer Pricing and Multinational Enterprises to denote a special department within a parent company or regional holding company or any other associated enterprise within a multinational enterprise (MNE) providing services to associated enterprises.
GROUP TREATMENT: -- Term used to describe the tax treatment where the profits and losses of associated companies may be grouped together and, in effect, be treated as the aggregated profits of a single enterprise (sometimes called a "fiscal unity").
Groupthink: is an unhealthy group decision-making behavior that occurs when all members of a group conform their thinking to the perceived consensus of the group.
Growth capital: Also referred to as development capital, this refers to a minority investment where the capital is used to fund the expansion of an established business. This can include acquisitions, increased working capital, the purchase of assets or the development of new products and services. Growth capital can also be used to refinance bank debt. Read more.
Growth mindset: is a concept developed by Carol Dweck in which people believe they are in control of their abilities and can learn, improve, and develop them.
Growth Stock: An investment based on the expectation that a company will grow quickly, rather than on its current profitability.
GUARANTOR: -- A person who guarantees, endorses, or provides indemnity agreements with respect to debts owed to others.
Guardian: – A person legally empowered and charged with the duty of taking care of another who, because of age, intellect or health, is incapable of managing his or her own affairs. A guardian is responsible for the person and his/her well-being, and a conservator manages the property of a minor or incapacitated person.
Guardian (For Minor Children): . The guardian is the person who will take care of the personal needs and upbringing of minor children ordisabled individuals upon the death of the surviving spouse. The guardian does not need to be the same person as the trustee of any trust created for the benefit of minor children, although it is the normal course of action. You may name different persons to take care of the personaland financial needs of your children. If you are considering naming spouses as co-guardians, please consider who should care for minor children in the event of the separation or divorce of the couple you are naming and who should serve as guardian in the event of the death of one of those spouses.
Guardian (or Conservator).: A person legally appointed to manage the rights and/or property of a person incapable of taking care of his or her own affairs. A “guardian ad litem” is appointed by the court to prosecute or defend an action for a minor.
Guardian’s deed -: Used to convey property of a minor or legally incompetent person.
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IBI (Institutional Buy In): Initiated when a financial institution, such as a private equity firm or venture capitalist, acquires a stake in another company, often in conjunction with a trade buyer.
IBO (Institutional Buy Out): Similar to an IBI, but in this scenario the financial institution, ordinarily a principal finance house or private equity firm, operates without a trade partner and usually acquires 100% of the target.
Icebreakers: are activities conducted at the beginning of training programs that introduce participants to one another and may introduce content, to help participants ease into the program.
illegitimate child: )- is a child born outside marriage, when the parents were not married.
ILT: (Instructor-Led Training) usually refers to traditional classroom training, in which an instructor teaches a course to a room of learners.
IMF: -- See: International Monetary Fund
IMMOVABLE PROPERTY: -- Also known as real property, immovable property comprises land, houses and buildings.
impact of loss: A value assigned to a worker to rate the effect on the enterprise when the worker leaves.
Implied Equity Value: Implied Equity Value is the value of the entire outstanding share capital of the target company (i.e. 100%) valued at what the bidder is valuing those shares, hence why they are implied. The value will always represent 100% regardless of what stake is actually being acquired.
IMPORT DUTY: -- See: Duty
IMPOST: -- The term "impost" means tax and refers particularly to a duty on imported goods and to clarification (by customs) of (imported) goods in order to assess the proper (import) taxes.
IMPUTATION SYSTEM: -- System under which at least part of the tax paid by a company on its profits is credited against the tax liability of shareholders in receipt of distributions paid by the company out of those profits.
IMPUTED INCOME: -- The economic benefit a taxpayer obtains through performance of self-provided services or through the use of self-owned property.
IMPUTED INTEREST: -- Implied interest. In a mortgage that states an insufficient interest rate, tax law will impute a higher rate and a lower principal, which will increase taxes on the receipt of payment.
IN KIND: -- Broadly speaking, a distribution or payment other than in money.
Inactive: Family members not working on the farm or in the agribusiness
INBOUND TRANSACTION: -- Term which refers to the tax treatment of foreigners doing business and investment in other countries.
INCENTIVE STOCK OPTION (ISO): -- An equity-type compensation plan under which qualifying stock options are free of tax at the date of grant and the date of exercise but are taxed when sold. US system.
INCIDENCE OF TAX: -- The person who bears the tax burden in economic sense, which could be different from the person paying the tax.
Incidents of ownership: – Rights applying to ownership interest in an insurance policy. These include the right to change a beneficiary, borrow on a policy, and change premium modes.
Income: Monies or other compensation received from any source. This includes wages, commissions, bonuses, Social Security and other retirement benefits, unemployment compensation, disability, interest, and dividends. Generally, all income is taxable unless it is specifically exempted by law.
Income Beneficiary: One who receives income from assets held in trust.
INCOME PROPERTY: -- Often, real estate that is bought for the income it produces.
INCOME SHIFTING: -- Income splitting
INCOME SPLITTING: -- A number of arrangements, the essential feature of which is that income, which would have been taxed at a higher rate in the hands of the person who derived it, is taxed in the hands of another person at a lower rate.
INCOME STATEMENT: -- Statement showing the results of a business operation for a particular period of time. The statement will show the business's revenues and expenses.
INCOME SUBJECT TO TAX: -- All sources of income liable to tax without taking account of tax allowances.
INCOME TAX CREDIT: -- See: Credit, tax
INCORPORATION: -- The process by which a company receives a government charter allowing it to operate as a corporation.
INDEMNIFICATION: -- Amount of money received by persons or entities as compensation for damages or for losses incurred.
INDEPENDENT AGENT: -- See: Agency
INDEPENDENT CONTRACTOR: -- A contractor who is self-employed.
INDEPENDENT ENTERPRISES: -- Two enterprises are independent enterprises with respect to each other if they are not associated enterprises with respect to each other.
INDEPENDENT PERSONAL SERVICES: -- Services performed by an independent contractor. An independent contractor is hired to do work according to his own methods and is not subject to the control of an employer except as to the result of his work. With the removal of Article 14 from the OECD Model, this issue is now dealt with by Article 7 as business profits in most cases.
Index: An average of the prices of a hypothetical basket of securities representing a particular market or portion of a market. Among the most well known are the Dow Jones Industrials Index, or the Dow; the Standard & Poor’s 500 Index, or the S&P 500; and the Russell 2000 Index. Index performance is not indicative of the past performance of a particular investment. Past performance does not guarantee future results. Individuals cannot invest directly in an index.
INDEXATION: -- See: Index-linked adjustment
INDEX-LINKED ADJUSTMENT: -- Expedient adopted in many commercial transactions to provide a workable solution to some of the problems created by inflation and monetary depreciation. The mechanism is essentially one of adjusting payments, profits, gains, taxable income brackets, tax allowances, etc. by discounting or otherwise modifying them by reference to an accepted index of inflation or other indices.
INDIRECT COST: -- Costs that cannot be identified in relation to a particular activity but that, nevertheless, are related to the direct costs (e.g. overhead expenses, costs of supporting departments, and a proper share of research and development (R&D) costs).
INDIRECT TAX: -- Tax imposed on certain transactions, goods or events. Examples include VAT, sales tax, excise duties, stamp duty, services tax, registration duty and transaction tax
INDIRECT TAX CREDIT: -- See: Credit, underlying (indirect) tax
INDIRECT-CHARGE METHOD: -- A method of charging for intra-group services based upon cost allocation and apportionment methods.
Individual Assessment: Analyzes how well an individual employee is doing a job and determines the individual's capacity to do new or different work. Individual assessment provides information on which employees need training and what kind.
Individual Development Plan: A tool to assist employees in achieving their personal and professional development goals. IDPs help employees and supervisors set expectations for specific learning objectives and competencies. While an IDP is not a performance evaluation tool or a one-time activity, IDPs allow supervisors to clarify performance expectations. IDPs should be viewed as a partnership between an employee and their supervisor, and involves preparation and continuous feedback.
Individual development plan (IDP): is a plan for personal improvement in a current job or for job advancement. Content may be tied to performance data; however, a development discussion is usually held at a different time from a performance appraisal discussion.
Individual Learning Accounts: A base amount of resources expressed in terms of dollars and/or hours that is set aside for an individual employee to use for his or her learning and development. Accounts may be used to develop knowledge, skills, and abilities that directly relate to the employee's official duties.
Individual Retirement Account (IRA): A qualified retirement account for individuals. Contributions to a Traditional IRA may be fully or partially deductible, depending on your individual circumstance. Under the SECURE Act, in most circumstances, once you reach age 72, you must begin taking required minimum distributions from a Traditional Individual Retirement Account (IRA). Withdrawals from Traditional IRAs are taxed as ordinary income, and if taken before age 59½, may be subject to a 10-percent federal income tax penalty. You may continue to contribute to a Traditional IRA past age 70½ under the SECURE Act as long as you meet the earned-income requirement.
individual score: The number assigned to each matching content item of the content types for which you specify the priority or importance.
Inflation: An upward movement in the average level of prices. Each month, the Bureau of Labor Statistics reports on the average level of prices when it releases the Consumer Price Index (CPI).
Informal learning: is what occurs outside a structured program, plan, or class. This type of learning occurs naturally through observations, trial and error, and talking and collaborating with others. It is usually spontaneous, and could include coaching, mentoring, stretch assignments, or rotational assignments. It can also include reading books and blog posts, watching online video platforms such as YouTube, listening to podcasts, searching the Internet, and retrieving other digital content.
INFORMATION RETURN: -- Declaration made by a person who has economic information about a potential taxpayer, regardless of whether that person is liable for withholding tax.
Inherit –: To receive property from a deceased person.
INHERITANCE: -- Real property or personal property that is received by heirs.
Inheritance tax –: A tax paid by a person who inherits property or assets having financial value. The rate of taxation depends on the size of the inheritance and the relationship between the person who inherits and the deceased. Inheritance tax laws vary state by state. Some states have no inheritance taxes and some states have county inheritance taxes.
In-house: The term in-house refers to conducting an activity or operation within anorganisation, instead of relying on outsourcing. For example, in relation totalent management this means that assessments and training will becarried out by employees rather than external specialists.
Initial Public Offering (IPO): A company’s first public offering of stock. In an IPO, investment banks buy a company’s shares and then offer them to the public at an offering price. As the stock is traded, the market price may be more or less than the offering price. Keep in mind that the return and principal value of stock prices will fluctuate as market conditions change. And shares, when sold, may be worth more or less than their original cost.
INPUT TAX: -- Term used in connection with VAT to denote the tax embodied in purchases made by a trader or entrepreneur who will usually be able to obtain a credit for the tax that his suppliers have paid on the goods supplied to him which form his "inputs".
Insolvency: Occurs when a company files for bankruptcy and sells off part or all of its assets to bring in the cash necessary to satiate creditors.
INSTALMENT SALE: -- Sale for which the consideration is received by way of more than one payment or instalment.
Institutional investors: Organisations that invest professionally, such as insurance companies, pension funds, investment companies and hedge funds.
Instructional Design: is an essential element of an effective learning effort. The creation of learning experiences and materials is what results in the acquisition and application of knowledge and skills.
Instructional Designer: is an individual who applies a systematic methodology based on instructional theory to create learning content.
Instructional systems design or instructional systems development (ISD): is the practice of creating learning experiences. It is a systems approach to analyzing, designing, developing, implementing, and evaluating any instructional experience based on the belief that training is most effective when it gives learners a clear statement of what they must be able to do as a result of training and how their performance will be evaluated.
INSTRUMENT: -- A legal document that records an act or agreement and provides the evidence of that act or agreement. Instruments include contracts, notes, and leases (e.g. a debt instrument).
Instrument –: ordinarily a tool or device used to perform some task. So it is in law; the tool or instrument in the legal context is a formal legal document setting out the intentions, rights, obligations and liabilities between the people involved (the parties), to achieve the performance of something, or not do something as the case may be. There must be strict adherence to the required technical formalities for signing and execution in order for the document to be authorised at law and effective as intended. Examples of formal legal instruments are deeds, agreements, wills, guarantees. An Act of Parliament may be referred to as an instrument.
INSURANCE PREMIUMS: -- The amount paid to an insurance company to cover potential hazards.
INSURANCE SETTLEMENT: -- Receipt of proceeds of an insurance policy.
INTANGIBLE PROPERTY: -- Property which has no physical existence but which has a value based on a legal right of the owner, e.g. goodwill, patent, trade mark, copyright, software, inventions, designs, i.e. all manner of intellectual property. Intangible property is usually transferred by way of a licensing agreement, and payments for the intangible are made in the form of royalties.
Integrated Collaboration Environment or Collaborative Workspace: A virtual environment where teams may work on projects and share information. Project teams can access a shared workspace where they upload files and share them with one another. Common examples are Sharepoint, Google Apps, Google Docs, Zoho and Moodle. People may also establish shared spaces to learn from one another either formally or informally. For example, individuals from different agencies involved in training and development may create a workspace to share ideas, experiences, and resources to develop a supervisory training program.
Integrated or Integral Financial Planning: An approach to financial planning that helps clients with both the interior and exterior aspects of their relationship with money.
Integration: involves combining hardware, software (and, in e-learning, content) components together to work as an interoperable system. The process of integration may also include front-end planning and strategy.
INTEGRATION, FULL: -- System which provides for retained as well as distributed profits to be included within the framework of an imputation system. All corporate-source income, whether retained or distributed, is taxed at the appropriate marginal rate in the hands of ultimate shareholders.
Intellectual Property: is an idea, invention, formula, literary work, presentation, or other knowledge asset owned by an organization or individual. Intellectual property can be protected by copyrights, patents, trademarks, or service marks.
INTENTIONAL SET-OFF: -- A benefit provided by one associated enterprise to another associated enterprise within the group that is deliberately balanced to some degree by different benefits received from that enterprise in return.
INTER ALIA: -- Latin for "among other things"
Inter vivos: – between living persons, someone transfers or gives property to another person while both are alive, such as a parent giving money or other property to their children. Trusts established during a person’s lifetime are often referred to as being inter vivos.
Interagency Rotational Assignment: Developmental assignment at an agency different from the one in which the employee has a permanent position.
Interagency Training: Training provided by one agency for other agencies or shared by two or more agencies.
INTERCOMPANY PRICING: -- See: "Transfer pricing"
INTERCOMPANY TRANSACTIONS: -- Transactions between members of an affiliated group filing a consolidated return; gain or loss is deferred until a property is disposed of outside the group.
INTERCORPORATE DIVIDENDS: -- Dividends distributed between two companies (domestic or foreign) arising from a shareholding or participation in the capital of the paying company.
Interest Rate: The cost to borrow money expressed as a percentage of the loan amount over one year.
Interest.: Any right in property.
INTERGENERATIONAL MENTORING: We work with you to prepare your children and grandchildren to be wise stewards of the wealth they will inherit; as well as helping you to train them to run the family business.
Intergenerational succession: – Succession in property ownership in which the property is transferred from one generation to another, usually from members of an older generation to members of a younger generation. In business succession planning, it includes the transfer of management responsibilities and profit opportunities.
Interior Finance: The emotional aspects of financial decisions: what we believe and how we feel about money.
Interleaving: is a deliberate practice technique where topics within the instruction are alternated—so one is started before the other is completed. This technique weaves topics together and repeats them.
INTERMEDIARY COMPANY: -- See: Conduit company
Internal Federal Coach: A professional coach who is employed within a Federal agency and provides coaching services to other Federal employees across Government.
INTERNAL MARKET: -- In the context of the European Union, an area without internal frontiers in which the free movement of goods, persons, services and capital is ensured.
INTERNAL REVENUE BULLETIN (IRB): -- A weekly publication summarizing various IRS administrative rulings.
INTERNAL REVENUE CODE (IRC): -- Legislation passed by US Congress that specifies what income is to be taxed, how it is to be taxed, and what may be deducted from taxable income.
INTERNAL REVENUE MANUAL (IRM): -- An official compilation of policies, procedures, instructions, and guidelines for the organization, functions, operation, and administration of the Internal Revenue Service. The IRM guidelines do not confer any rights on taxpayers.
INTERNAL REVENUE SERVICE (IRS): -- The agency of the US federal government that is responsible for the administration and collection of federal taxes.
INTERNATIONAL DOUBLE TAXATION: -- See: Double taxation, domestic and international
INTERNATIONAL MONETARY FUND (IMF): -- An international organization established in 1945, headquartered in Washington, DC. The purposes of the IMF are, inter alia, to promote international monetary cooperation, facilitate the expansion and balance growth of international trade and promote stability in foreign exchange.
INTERNATIONAL TAXATION: -- Traditionally, international taxation refers to treaty provisions relieving international double taxation. In broader terms, in includes domestic legislation covering foreign income of residents (worldwide income) and domestic income of non-residents.
Intestate: – when a person dies without having made a valid will according to law, or if they did, for some reason it may not be legally valid, either in whole or in part so it does not completely dispose of all of their property. They are said to have died intestate. An
Intestate succession: – Laws that direct how a deceased’s assets shall be divided when the person dies intestate (without a will).
Intestate.: Dying without a Will. If you die without Will, your assets will be distributed according to intestacy succession laws of the state in which you live.
INTRA GROUP SERVICES: -- Services provided by a group company to another affiliated company. The cost of general services such as management, administrative and similar services may be often allocated among the various members of the group without any profit mark-up, whereas services performed in the ordinary course of business are subject to arm's length conditions.
Intrapreneurial: is a situation where an employee works internally but is expected to act using entrepreneurial attributes.
Investing: Providing for one’s future by not merely saving part of one’s earnings, but by buying a diversified portfolio of assets that will increase in value over time.
INVESTMENT: -- The purchase of stocks, bonds, mutual fund shares, real property, an annuity, collectibles, or other assets, with the expectation of obtaining income or capital gains-or both-in the future.
INVESTMENT ALLOWANCE: -- Allowance with respect to a qualifying depreciable asset. It adds a certain percentage of the asset's initial cost to the full depreciation write-off and is usually given in the year of acquisition or as soon as possible thereafter.
Investment Bank: Not a bank at all, so don’t get them confused with the people who lend you money.An investment bank is the key advisor you employ to help you sell your business. They make as shortlist of buyers (both trade and PE), produce an IM, run a process and try to maximise value for you. Think of them like an estate agent for businesses.You’ll pay them an amount of money that would make a casino owner blush.Also called “the advisor” or “sell-side advisor”
Investment Category: A broad class of assets with similar characteristics. The five investment categories include cash alternatives, fixed principal, equity, debt, and tangibles.
Investment Committee (IC): The group of senior partners and sometimes non-executives that ultimately decide on which asset to buy.Your investment director will represent you to the IC, will write investment papers explaining the investment opportunity and will answer their challenges and questions.Investment Committees almost always seem to meet every Monday morning so you’ll find your investment director there presenting nervously toward the end of your process.
INVESTMENT COMPANY: -- Corporation whose activities consist exclusively or substantially of making investments (i.e. holding property and collection of income therefrom) and whose buying and selling of shares, securities, real estates or other investment property is only incidental to this purpose.
INVESTMENT DEDUCTION: -- See: Investment allowance
Investment Director: This is the person at the PE firm who is responsible for buying your business. They then sitting on your board, normally for the duration of the investment. Their fortunes are closely tied to yours – they bought you and their reputation is on the line. They will deeply want you to succeed.So the two people who should wake up each morning working about the business performance and fretting about how to execute on the opportunity are the CEO and the Investment Director who bought the asset.Investment Directors tend to stay surprisingly long periods with a particular PE firm partly because their earnings are tied to the investment cycle. So they’re on a 6 year delay to get paid their bonus for for your successful investment period.You should really like the Investment Director that is bidding for you as you’re going to be their partner for the next 4 or 5 years.
INVESTMENT GOODS: -- See: Fixed assets
INVESTMENT INCENTIVES: -- Financial and tax incentives used to attract local or foreign investment capital to certain activities or particular areas in a country.
INVESTMENT INCOME: -- Income derived from the investment of capital, whether money or other property, in income-producing assets or in a profit-making venture without active participation in the production of the income or in the affairs of the venture.
Investment Memorandum (IM): A document written by you and your investment bank that explains your business and the investment opportunity to potential investors.An IM will normally include a description of the business and your products, your market, customers, competitors, risk and opportunities. It’s essentially a brochure for your business so it leans to an optimistic, rosy future.Also see hockey stick projection which can be found in a surprising number of IM’s.
INVESTMENT METHOD: -- Method used in connection with VAT where an immediate credit is granted against tax for that part of expenditure incurred during the year for acquisition of business assets (such as plant and machinery by a manufacturer) which related to the tax element in the price of such assets.
Investment Objective: The stated financial goal of an investment.
INVESTMENT PLANNING & ASSET ALLOCATION*: Are your investments performing the way you want them to? Do you have proper asset allocation and good diversification? As Registered Representatives with United Planners our investment process will help make sure your investments are well positioned to meet your needs for growth and provide income to meet your objectives.
INVESTMENT RESERVE: -- This system permits eligible taxpayers to set aside part of their profits as a reserve for future investment and deduct from their income the amount of the annual contribution to the reserve.
INVOICE BASIS: -- Method of applying VAT to the price at which the goods or service are invoiced, with a deduction for the tax (if any) charged at previous stages.
INVOICE COMPANY: -- Term used in the context of transfer pricing to refer to a company established in a low-tax or no-tax jurisdiction for the purpose of shifting profits to that jurisdiction.
IRA: Individual retirement account, not an investment in itself but a “container” to hold investments. An IRA permits individuals to set aside money each year, with earnings tax-deferred until withdrawals begin at age 59 1/2 or later (or earlier, with a 10% penalty). The exact amount depends on the year and your age. IRAs can be established at a bank, mutual fund, or brokerage. A traditional IRA allows the amount deposited to be deducted from current income, but any distributions are fully taxable. A ROTH IRA does not allow for a current deduction from income, but all distributions are tax-free.
IRB: -- See: Internal revenue bulletin
IRC: -- See: Internal revenue code
IRM: -- See: Internal revenue manual
IRR or internal rate of return: A typical measurement used by private equity firms to compare the profitability of its investments.
Irrevocable Trust: A trust that cannot be altered, stopped, or canceled after its creation without the permission of the beneficiary or trustee. Using a trust involves a complex set of tax rules and regulations. Before moving forward with a trust, consider working with a professional who is familiar with the rules and regulations.
IRS: -- See: Internal revenue service
ISSUED SHARE CAPITAL: -- Shares that have been sold to shareholders by the corporation
ITEMIZED DEDUCTIONS: -- In the US a deduction as specifically set forth in the Internal Revenue Code. The deductions in this part are individually listed, item by item.
Succession Planning: K
Keogh Plan: A tax-deferred retirement plan for self-employed individuals and employees of unincorporated businesses. Keogh plans are similar to IRAs but have significantly higher contribution limits. Distributions from Keogh plans and most other employer-sponsored retirement plans are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty. Generally, once you reach age 70½, you must begin taking required minimum distributions.
Key Employee: An employee who has valuable skills, knowledge, or organizational abilities, who is considered critical to the success of a given company.
Key Indication: The attribute that specifies a Key Job or Key Position
Key Job: A job whose positions are determined to be Key Positions
Key Performance Indicator (KPI): Key Performance Indicators are ways to periodically assess theperformance of organisations, teams and individuals. The indicators thatorganisations are looking for will depend on the business goals and valuesthat they maintain.
Key Person Insurance: Company-owned insurance designed to cover the cost of replacing a key employee if he or she were to die or become disabled.
Key Position: A position that is critical to the operation or long-term success of an organization
Key Roles: Key roles are those that cannot be filled by anyone. Senior managerialpositions, directors and executives, tend to be classed as key roles as youneed to be very experienced to fill them and to lead the organisation inthe right direction.
KIDDIE TAX: -- Term used to describe tax levied in the US on the unearned income of a child under 14. The income is taxed at the parent's highest rate of tax.
Kirkpatrick, Donald: is considered the father of training evaluation, which he first postulated in the 1950s. He created the four levels of evaluation: reaction, behavior, results, and business impact.
KNOW-HOW: -- All undivulged technical information, whether or not capable of being patented, that is necessary for the industrial reproduction of a product or process, i.e. knowing how a product is made or how a particular process works. Payments for know-how may be taxed as royalties in many cases. The distinction from contracts for the provision of services is addressed in the OECD Commentary to Article 12.
Knowledge: Information and skills acquired through education or experience.Experienced employees play a crucial role in passing their knowledgedown to younger recruits and helping to build in a succession plan.
Knowledge Assessment: This is one of the first steps organisations should take when trying to gageemployee knowledge and competency. It will normally take the form of aquestionnaire or multiple choice tests.
Knowledge Management (KM): is a systematic approach to achieving organizational goals by creating, capturing, curating, sharing, and managing the organization’s knowledge to ensure the right information and knowledge flow to the right people at the right time.
Knowledge mapping: is a process for identifying and connecting the location, ownership, value, and use of knowledge and expertise in an organization. Examples of knowledge maps include network charts, yellow pages of experts, or a matrix relating knowledge to key processes.
Knowledge, Skills, and Abilities (KSA's): The attributes required to perform a job and are generally demonstrated through qualifying experience, education, or training. Knowledge is a body of information applied directly to the performance of a function. Skill is an observable competence to perform a learned psychomotor act. Ability is competence to perform an observable behavior or a behavior that results in an observable product.
Knowles, Malcolm,: is considered the father of adult learning theory. He defined six assumptions about adult learning and published The Adult Learner: A Neglected Species in 1973.
Succession Planning: L
LANDED COST: -- Term used in relation to the importation of goods which means the sum total of the cost of the goods concerned, the amount of customs duties levied on those goods and the expense incurred in unloading them.
Lapse –: when a beneficiary dies before the testator.
LAST IN, FIRST OUT: -- See: LIFO
Last Will and Testament.: A legally executed document which explains how and to whom a person would like his or her property distributed after death.
Lateral succession: – Succession in property ownership in which the property is transferred between members of the same generation.
Leadership: The act of leadership can be defined as organising a group of people toachieve a common goal. Common traits that have been associated withstrong leadership skills are; situational interaction, vision, values,behaviour, intelligence and charisma, along with others.
Leadership Competency Model: A model that describes the sets of skills and abilities required for individuals to guide the workforce. In the Federal sector, OPM's 1998 Leadership Competency Model (comprised of 27 competencies grouped by five broad dimensions) is the accepted model. It reflects the qualifications necessary to succeed in the Governmentwide Senior Executive Service and is also used by agencies in selecting managers and supervisors.
Leadership Development: is any activity that increases an individual’s leadership ability or an organization’s leadership capability, including activities such as learning events, mentoring, coaching, self-study, job rotation, and special assignments to develop the knowledge and skills required to lead.
Leadership Development Program: Formal developmental program that provides leadership training and development opportunities.
Learning Content Management System (LCMS): is software technology that provides a multi-user environment where developers, authors, instructional designers, and subject matter experts may create, store, reuse, manage, and deliver digital e-learning content from a central object repository. An LCMS focuses on the development, management, and publication of content that is typically delivered via a learning management system (LMS).
Learning Experience Platform (LXP): goes beyond a traditional LMS to provide personalized social and online learning opportunities.
Learning Management System (LMS): is software technology for delivering online courses or training to learners while performing learning management functions, such as creating course catalogs, keeping track of learners' progress and performance across all types of training, and generating reports. An LMS is not used to create course content; that work is performed using an LCMS.
Learning Modality: is how information is received through the five senses: hearing, seeing, smelling, tasting, and touching.
Learning Objectives: are clear, observable, measurable goal statements of behavior that a learner must demonstrate for training to be considered a success.
Learning Sciences: refers to the interdisciplinary research-based field that works to further the understanding of learning, learning innovation, and instructional methodologies.
LEASE: -- In general, a lease is a contract in respect of real or personal property, under which the owner of the property grants to another the right to possess, use and enjoy the property for a specified period of time in exchange for periodic payments.
LEASEBACK: -- See: Sale and leaseback
Legacy: – a gift of personal property for example money or personal items such as jewellery to a person. The person to receive the gift and benefit from it (the beneficiary) is named in the will. This person or beneficiary may also be referred to as the
Legacy Planning: An integral approach to estate planning which also includes the interior aspects.
LEGAL ENTITY: -- Generally, corporations, joint-stock companies and limited liability companies are regarded for tax purposes as having an existence separate from that of their shareholders. Conversely, for tax purposes a partnership is often not regarded as a separate legal entity, its profits being taxed in the hands of the individual partners. What constitutes a legal entity for tax purposes may or may not coincide with what constitutes a legal entity for general law purposes.
LEGAL RESERVE: -- Under the civil law of some countries corporations are required to maintain a legal reserve for all needs which may arise in the course of the business. Tax law does not allow a deduction for such a reserve.
LETTER RULING: -- See: Advance ruling
LETTER-BOX COMPANY: -- A paper company, shell company or money box company, i.e. a company which has compiled only with the bare essentials for organization and registration in a particular country. The actual commercial activities are carried out in another country.
Letters of administration: – A document issued by the probate court giving the administrator authority to administer the estate.
Letters of Administration or Letters Testamentary.: Letters issued to a personal representative by the probate court giving him or her power to affect and transfer the decedent's probate property.
Letters testamentary: – A document issued by the probate court giving the executor authority to administer the estate under the provisions of the decedent’s will.
LEVEL PLAYING FIELD: -- This term denotes to reduce, by means of tax policy, the differences in the taxation of internationally mobile entities or transactions allowing countries to compete fairly on non-tax factors.
Leverage: Leverage is a fancy word for debt or borrowing money. You need leverage in private equity as most deals are structured as a leveraged buy out.
Leveraged Buy Out: Most PE deals are structured as a leveraged buy out meaning they rely on borrowing from the bank as a way of paying for the acquisition of the business.The reason for this is that it is cheaper to borrow money from the bank than it is to borrow it (get it through investment) from your PE firm.A PE firm typically wants to triple the size of its investment over a period of four to five years (any more is gratefully received). Whereas a bank might only want 6% interest per year.So if you got £10m of funding each from a bank (as
Leveraged buyout (LBO): An acquisition which uses both equity and debt funding, with the company using cash flow to repay the debt.
LEVERAGING: -- See: Gearing
Liabilities –: Financial amounts owed by a person, family or business. Everything owed to others.
Liability: Any claim against the assets of a person or corporation: accounts payable, wages, and salaries payable, dividends declared payable, accrued taxes payable, and fixed or long-term obligations such as mortgages, debentures, and bank loans.
LIBOR: -- The London inter-bank offering rate is the rate at which London money banks lend to each other.
LICENSE DUTIES (OR FEE): -- Annual duties payable for the privilege of carrying on a certain trade.
LICENSING: -- Licensing is an agreement by which a licensor transfers the right to use his technology and/or know-how to a licensee for the production or manufacturing of a product in the licensee's country. Royalties are generally paid for the right to use the technology or know-how.
Licensing Agreement: A Licensing Agreement is a contract between an entity who owns intellectual property (licensor) and an entity who is granted the right to make use of that intellectual property, according to the terms of the contract (licensee). Typical terms include compensation (i.e., royalties), scope, exclusivity, contract length, quality control, renewal, and termination. Terms for Licensing Agreements vary widely, and a fairly drafted document can protect both parties while allowing everyone to benefit financially.
Lien: – is a type of right to hold something belonging to another person as security for the payment of a debt. Used in the context of law practice for example where a lawyer may claim a lien over documents until legal fees are paid.
Life estate: – A transfer of ownership from an owner to a second party with a reservation of some rights, such as life use of the residence. The property does not go through probate but is usually considered a part of the decedent’s estate for tax purposes.
Life Insurance: A contract under which an insurance company promises, in exchange for premiums, to pay a set benefit when the policyholder dies. Several factors will affect the cost and availability of life insurance, including age, health and the type and amount of insurance purchased. Life insurance policies have expenses, including mortality and other charges. If a policy is surrendered prematurely, the policyholder also may pay surrender charges and have income tax implications. You should consider determining whether you are insurable before implementing a strategy involving life insurance. Any guarantees associated with a policy are dependent on the ability of the issuing insurance company to continue making claim payments.
Life Insurance Trust.: An irrevocable trust that owns a person’s life insurance policy as its principal asset. Properly created and maintained, the proceeds of the life insurance policy owned by a life insurance trust may not be considered as part of the decedent's gross estate for estate tax purposes. Sometimes called an Irrevocable Life Insurance Trust or "ILIT". More information about life insurance trusts can be found here.
LIFE INTEREST: -- Assets may be given to a person for his lifetime use or benefit, with the stipulation that after his (the life tenant's) life, the asset will pass to another beneficiary.
Life Planning (also Integrated Financial Planning or Integral Financial Planning): An approach to financial planning that helps clients with both the interior and exterior aspects of their relationship with money.
LIFE TENANCY: -- Under common law an interest in possession whereby the individual beneficiary is entitled to the income of a trust or settlement until his death.
Life tenant: – A person with the right to use an estate for the period of his or her lifetime or that of another specified person.
Lifelong Learning: is the ongoing, self-motivated quest for knowledge to develop personally or professionally.
Lifetime QTIP Trust (LQTIP): . is an irrevocable trust created by one spouse for the benefit of the other spouse. The Lifetime QTIP Trust is often used to equalize the assets of each spouse, so that they can take advantage of both of their applicable estate tax exemptions no matter who dies first.
LIFO: -- Method ("last in, first out") of valuing inventory or stock-in-trade whereby the goods or materials purchased last are regarded as those which are sold first.
LIMITATION ON BENEFITS PROVISION: -- Tax treaty provisions designed to restrict treaty-shopping opportunities by limiting treaty benefits to persons who meet one of several enumerated tests, which may require minimum level qualifications, e.g. local ownership.
LIMITATIONS, STATUTE OF: -- See: Statute of limitations
LIMITED (SPECIAL) PARTNER: -- See: Limited partnership
LIMITED LIABILITY: -- Liability of investor which is limited to the extent of his investment
LIMITED LIABILITY COMPANY (LLC): -- Business form that combines the flexibility and tax advantages of a partnership with the limited liability features of a joint-stock company. An LLC may be taxed as a partnership or a corporation depending on the nature of the status under which it is organized.
Limited Parter (LP): LP’s are your investor’s, investors. They are the people and companies who invested in the PE fund that your business is being bought buy. They are often pension funds, or maybe large family offices.You may never meet the LP’s unless you’re invited to present at your PE firm’s AGM. But the LP’s will know you and your company from the PE firm’s regular reports.
Limited Partnership: Limited partnerships pool the money of investors to develop or purchase income-producing properties. When the partnership subsequently receives income from these properties, it passes the income on to its investors as dividend payments. Limited Partnerships are subject to special risks such as illiquidity and those risks inherent in the underlying investments. There are no assurances that the stated investment objectives will be reached. At redemption, the investor may receive back less than the original investment. Individuals must meet specific suitability standards. These standards, along with the risks and other information concerning the partnership, are set forth in the prospectus, which can be obtained from your financial professional. Please consider the investment objectives, risks, charges, and expenses carefully before investing. Be sure to read the prospectus carefully before deciding whether to invest.
Lineal descendant –: One who is, by blood relationship, in the direct line of descent from an ancestor. The term often includes legally adopted children.
Linear descendant, lineal descent: – refers to a person’s blood relatives in a direct line of descent – grandparent, parent, child, grandchild. By contrast a collateral descent refers to a blood relationship connecting those with a common ancestor but along the lines of sibling relationships – of a brother, sister, aunt or uncle, brother to brother, cousin to cousin, aunt and nephew or niece.
LINK STRUCTURE: -- Structure operating as a result of the different rules in various countries for determining the place of residence; it is a means used by dual resident companies to obtain tax relief in two countries.
LIQUIDATION: -- A company in liquidation is a company in the process of being dissolved or wound up, and its assets, if any, after payment of its debts, distributed to the shareholders.
Liquidity: The ease and speed with which an asset or security can be bought or sold.
LISTED COMPANY: -- Company whose shares are traded on a recognized stock exchange.
LISTED SECURITIES: -- See: Quoted securities
Living Trust: A trust created by a living person which allows that person to control the assets he or she contributes to the trust during his or her lifetime and to direct their disposition upon his or her death.
Living Trust.: Also called a “revocable living trust” and explained below.
Living Will: A living will, which is another type of advance medical directive, can be used to outline which medical procedures you want to be used to prolong your life, typically in the event of a terminal illness. It generally does not become effective until you become incapacitated. Even if your state does not authorize a living will, you may still want one as a way to document your wishes.
LLC: -- See: Limited liability company
LLC (Limited Liability Company): An entity similar to a corporation that may be created for ownership of a business or to hold assets such as real estate properties for asset protection.
LOAN CAPITAL: -- See: Debt capital
Loan notes: A loan note is an interest-bearing subordinated debt obligation that ranks behind the senior debt in your structure but ahead of the ordinary equity.
LOCAL TAX: -- In countries where there is a central or federal government and separate levels of government at state, provincial, county or city levels, taxes levied at the lower levels of government are commonly referred to as "local" taxes.
LOCATION OF ASSETS: -- The location of an asset is relevant to the determination of whether it is within a taxing authority's jurisdiction. Location of immovable property in a country means, in most countries, that the country taxes the income derived therefrom and possibly the value and capital gains realized on alienation, even if the owner is not a resident of that country.
LOCATION SAVINGS: -- Term used in the context of transfer pricing to refer to the savings or benefits such as cheaper production or service costs obtained by siting particular manufacturing operations in an offshore jurisdiction.
Long-term: This phrase tends to be measured in years. 5 to 10 years are commonlyseen as long term time scales. Thinking this far ahead is essential for abusiness to be successful years down the line.
LONG-TERM CAPITAL GAINS: -- In countries where capital gains are subject to special tax treatment, a distinction may be made between capital gains realized after a short period of time and capital gains realized after a longer period of time. Long-term capital gains may be taxed at reduced rates.
Long-term care (LTC) insurance: – Insurance coverage that may provide payments for nursing-home care, homehealth care, and personal or adult day care for individuals.
Long-Term-Care Insurance: Insurance that covers the cost of medical and non-medical services needed by those who have a chronic illness or disability—most commonly associated with aging. Long-term-care insurance can cover the cost of nursing home care, in-home assistance, assisted living, and adult day care.
LOOKING THROUGH: -- Term typically used when disregarding the separate legal identity, for example, a company, in order to charge tax on a shareholder in respect of his share of the company profits.
LOOPHOLE: -- Opportunities available in tax law to minimize a taxpayer's tax burdens.
LOSS RELIEF: -- Most income tax laws provide some form of relief for losses incurred, either by carrying over the loss to offset it against profits in previous years (carry-back) or in future years (carry-forward) or by setting off the loss against other income of the same taxpayer in the year in which the loss was incurred.
LOSSES: -- The term may broadly be defined as the excess of expenses over revenues for a period, or the excess of the cost of assets over the proceeds when the assets are sold or otherwise disposed of, or abandoned or destroyed.
LOTTERY TAX: -- Tax on the sale of lots or on the receipt of prizes after the drawing of lots.
LUMP-SUM DEDUCTIONS: -- Deduction, often from income, for the computation of taxable income, which does not reflect the factual situation.
Lump-Sum Distribution: The disbursement of the entire value of an employer-sponsored retirement plan, pension plan, annuity, or similar account to the account owner or beneficiary. Lump-sum distributions may be rolled over into another tax-deferred account.
LUMP-SUM EXEMPT AMOUNTS: -- Fixed sum of income, net worth, etc., below which no tax is due.
LUMP-SUM RATES: -- In specific cases, income tax (and other taxes) may be levied at a fixed rate instead of the rates usually applicable.
LUMP-SUM TAXATION: -- The tax laws of some countries allow the tax authorities to levy a fixed amount of taxes on income in certain circumstances which deviates from the normal method of applying a rate to income to ascertain taxes payable.
LUXURY TAXES: -- Indirect ad valorem tax imposed on supplies of specific non-essential and normally expensive commodities that are arbitrarily considered (e.g. toiletries, cosmetics, jewellery, pearls and precious stones and metals, etc.)
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M&A: Shorthand for the process of mergers and acquisitions.
Machine learning: incorporates algorithms that are composed of many technologies (including deep learning, neural networks, and natural language processing) that operate guided by lessons from existing information.
MAINTENANCE EXPENSES: -- 1. Expenses incurred by a taxpayer to provide for his family, former spouse or other relatives. 2. Expenses for the upkeep or preservation of a building or equipment.
MALPRACTICE: -- Improper or immoral conduct of a professional in the performance of his duties, done either intentionally or through carelessness or ignorance; commonly applied to accountants, tax preparers, and lawyers to denote negligent or unskilful performance of duties where professional skills are obligatory.
Management: The “management” of the company – essentially you and your team. Used as in “let’s ask Management” or “how are Managenent doing“, or “Management – keep / replace?”, which I once saw on an investors evaluation template!
Management buyout (MBO): An investment where the management team of a company or subsidiary leads its acquisition, often with a private equity firm investing alongside in return for a shareholding. This is typically perceived to be a lower risk investment given the team with the knowledge and expertise remains with the business. This compares to management buy-ins – where a new management team invests – and institutional buyouts – where an institution invests and appoints a management team. Read more.
Management Dinner: Right at the very end of the process, when you’re absolutely exhausted from several months of questions, diligence, presentations, advisor calls and working through issues and documents are the Management Dinners.This is where you and your executive team go for dinner with your final shortlist of PE firms in order that they can confirm that you know which way to hold a knife and fork.PE Investment Directors tend to be very charming and most have surprisingly good social skills given that they are accountants. So dinner with them in a fancy restaurant wouldn’t be the worst thing were it not for the timing. At this point in the process you are knackered and really want an early night.
MANAGEMENT EXPENSES: -- Generally the expenses of management are deductible in arriving at the taxable profits of an enterprise carrying on a trade. In the case of a group of companies it may be important to decide how far the general expenses of management of the group should be charged out to and recovered from the members of the group.
Management Fee: The cost of having assets professionally managed. This fee is normally a fixed percentage of the fund’s asset value; terms of the fee are disclosed in the prospectus.
MANAGEMENT SERVICE: -- See: Intra-group services
MANAGEMENT, PLACE OF: -- See: Place of management
MANAGEMENT, PLACE OF EFFECTIVE: -- See: Place of effective management
MAP: -- See: Mutual agreement procedure
MAP APA: -- See: BAPA
MARGINAL RATE OF TAX: -- Tax rate applicable to the top slice or bracket of a taxpayer's income or other taxable income, where the relevant tax on such items is levied at progressive rates.
Marginal Tax Rate: The amount of tax paid on an additional dollar of income. As income rises, so does the tax rate.
Marital Deduction: A provision of the tax codes that allows all assets of a deceased spouse to pass to the surviving spouse free of estate taxes. This provision is also referred to as the "unlimited marital deduction." The marital deduction may not apply in the case of noncitizens.
Marital Trust.: A trust established to hold property for a surviving spouse in A-B trust planning and designed to qualify for the marital deduction. A commonly used marital trust is a qualified terminable interest property trust, or QTIP trust, which requires that all income must be paid to the surviving spouse.
MARK TO MARKET: -- Tax and/or accounting convention under which the value of assets/liabilities is adjusted to reflect fair market value of a specific date.
Market capitalisation: The total value of all outstanding shares in a company. This is calculated as the number of shares multiplied by current price per share.
Market Capitalization: Market Capitalization, or market cap, is the total value of the shares outstanding of a publicly traded company. It is calculated by multiplying a company’s number of shares outstanding by the current market price per share.
Market Risk: The risk that an entire market will decline, reducing the value of the investments in it without regard to other factors. This is also known as Systemic Risk.
Market Timing: An investment philosophy under which investors buy and sell securities in an attempt to profit from short-term price fluctuations.
Market, as in “The Market”: “The Market” is the collective name for all of the advisors and people swimming about in the PE pond when the person talking doesn’t want to reveal who said what.So when someone says “Feedback from the market is that so and so is going to get their offer rejected”, it translates to “An advisor told me in the pub last night something that is supposed to be highly confidential”.One of the things you learn about PE is that it’s a small pond, full of gossip and all the advisors end up working for everyone. Information is power, power is money and to all gets traded on a nightly basis in the bars and restaurants around Mayfair.
MARKETABLE SECURITIES: -- See: Quoted securities
Marketable title: – Title that is free from encumbrances and any reasonable doubt as to the owner. Title can be sold or mortgaged readily.
MARKETING INTANGIBLE: -- An intangible that is concerned with marketing activities, which aids in the commercial exploitation of a product or service and/or has an important promotional value for the product concerned.
MARK-UP: -- An increase in the price of something, especially from the price a trader pays for something to the price he sells it for. In the context of transfer pricing, one method to estimate an arm's length price for transactions between affiliated companies is to increase the supplier's cost by an appropriate profit mark-up (Cost-plus method).
Maryland Trust Act: . A new act covering Maryland trusts that went into law as of January 1, 2015, but will affect some trusts create prior to that date. The Maryland Trust Act ("MTA") also provides some specific definitions to words, phrases or concepts included in many Maryland trust documents. Some of those definitions can be found here.
Maturity: The date on which a debt security comes due for payment and on which an investor’s principal is due to be repaid.
MBI – Management Buy In: Where an external candidate or management team acquires a business, sometimes replacing the existing management team.
MBI (Management Buy-In): The acquisition of a company by an external management team which is usually backed by a venture capitalist or private equity investor.
MBO – Management Buyout: This is where the existing management team of a company come together to buy the business from the out-going owner.
MBO (Management Buy-Out): The acquisition of a company by its incumbent management team which again is usually backed by a venture capitalist or a private equity investor.
Measureable: Any goals and aims that are set for you to achieve in the workplace mustbe measurable. There is no benefit of setting a goal that cannot betracked. By setting measurable goals workplace productivity andmotivation can be raised. The opposite will occur if there is no realistictarget in place.
Media Sharing: An online environment which allows users to search for photos, videos and/or other media for uses in (among others) presentations, learning materials and coursework. Users publish content to a larger audience. Instructors can record workshops and upload them to an online social network. Common media sharing tools are Flickr, Google+, and Youtube.
Medicaid: The federal government’s health program for eligible individuals and families with low income and resources. It is means tested, meaning those who apply for benefits must demonstrate they have need.
Medical directive or patient advocate –: A document advising medical care providers of a person’sintent, wishes, and desires in the event a medical catastrophe occurs. The medical directive may spell out specific wishes but also includes an appointed fiduciary to make necessary medical decisions. The document should include proper medical release information to allow access to medical records for an informed decision.
Medicare: The federal government’s health program for individuals aged 65 and over and for individuals who have certain disabilities or end-stage renal disease.
MEMORANDUM OF UNDERSTANDING (MOU): -- In the context of a tax treaty, a document exchanged between the treaty partners which sets out the understanding of the parties regarding the convention. Usually this does not have treaty status, but the status depends on the document itself.
Mental Toughness (resilience): Mental Toughness describes the capacity of an individual to dealeffectively with stressors, pressures and challenges, and perform to thebest of their ability, irrespective of the circumstances in which they findthemselves (Clough, 2002).
Mentor: A mentor will always involve a more experienced employee taking a newrecruit ‘under their wing’ It is seen as a developmental practice and is theprocess of transferring knowledge and skills to the younger person inorder to help their personal development and meet organisationobjectives.
Mentoring: A process that focuses specifically on providing guidance, direction, and career advice. It is usually a formal or informal relationship between two people-a senior mentor (usually outside the protégé's chain of supervision) and a junior protégé.
Merger: A transaction that involves the combination of two or more separate businesses into one, with equal holding and governance rights assigned to the respective shareholders of each company.
Metric: is a number that is generated by a standardized procedure and method of calculation; a measurement could result from a different calculation or measuring technique each time.
Mezzanine: Mezzanine is a form of finance which can be structured either as subordinated debt or preferred equity. It is often seen as a more expensive form of finance than traditional secured or senior debt as a result of being subordinated in a company’s capital structure, and therefore less likely to be repaid in the event of a default.
Mezzanine Finance: An funny name for money that’s somewhere between bank debt and investor debt.More risky than bank debt and therefore more expensive. Less probably much less, risky and less expensive than investor debt.
Microblogs: A popular tool to share knowledge and resources with one another. Instructors can incorporate microblogs to create a community around a course or an activity. Instructors also can post tips, assignments, and other information pertaining to the course. Course participants can summarize information learned during and after courses. Participants at conferences are using microblogs to informally exchange information learned from conference sessions. Common microblogs are Twitter and Yammer.
Microlearning: enhances learning and performance in the most efficient and effective manner possible through short pieces of content.
Mind-mapping: is a creative, converging technique that organizes thoughts and ideas in branching subcategories around one central topic.
MINERAL ROYALTIES: -- Regular payments, usually based on the volume or price of minerals extracted, made by mining enterprises to national states or other owners of mineral resources as consideration for the right to exploit particular mineral resources.
MINIMUM TAX: -- In certain countries corporations are always liable to a certain amount of annual tax, regardless of whether they have realized a profit.
MINISTRY OF FINANCE (MOF): -- Department of government generally responsible for formulating monetary policy, implementing the tax laws, collecting revenue, etc.
Minor: – a person under 18 years old.
Mission-Critical Occupations (MCOs): Occupations agencies consider core to carrying out their missions. Such occupations usually reflect the primary mission of the organization without which mission-critical work cannot be completed.
Mission-related training: Training that supports agency goals by improving organizational performance at any appropriate level in the agency, as determined by the head of the agency. This includes training that:Supports the agency's strategic plan and performance objectives;Improves an employee's current job performance;Allows for expansion or enhancement of an employee's current job;Enables an employee to perform needed or potentially needed duties outside the current job at the same level of responsibility; orMeets organizational needs in response to human resource plans and re-engineering, downsizing, restructuring, and/or program changes.
MIXER COMPANY: -- Term used to designate an intermediate holding company the purpose of which is to "mix" income from various foreign sources in order to maximize the benefit of foreign tax credits. The mixer company receives income both from countries with a higher tax rate than that of the destination country and from countries with a lower tax rate, which it then pays out as a dividend. This structure has the effect of averaging out the rate of foreign tax paid.
MNC: -- Abbreviation for multinational corporation
MNE: -- Abbreviation for multinational enterprises
Mobile Learning: is learning that takes place via wireless devices such as smart phones, tablets, or laptop computers.
Mobile Learning (M-learning): Mobile Learning focuses on learning across contexts and locations by the means of mobile devices (e.g. laptops, cell phones, personal digital assistants, MP3 players, smartphones, game devices, tablet PCs, and e-books). M-learning devices are used to access online courses and resources and can also foster collaboration among individuals, conduct assessments and evaluations, provide access to performance support, and capture evidence of a learning activity.
Mobility: The ability for an employee to relocate to another geographic location
Model: is a representation of an idea, object, process, or phenomenon.
model profile: A collection of the work requirements and required skills and qualifications of a workforce structure, such as a job or position.
MODEL TAX CONVENTIONS (TREATIES): -- A model tax treaty is designed to streamline and achieve uniformity in the allocation of taxing right between countries in cross-border situations. Model tax treaties developed by OECD and UN are widely used and a number of countries have their own model treaties.
Modules,: sometimes called lessons, are units of learning that provide content and practice based on predefined learning objectives. Each module contains objectives, information, task content, practice activities, and an assessment mechanism to determine whether the objectives were reached.
Money Market Fund: A mutual fund that invests in assets that are easily converted into cash and which have a low risk of price fluctuation. This may include money market holdings, Treasury bills, and commercial paper. Money held in money market funds is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Money market funds seek to preserve the value of your investment at $1.00 a share. However, it is possible to lose money by investing in a money market fund.
Money Scripts: Unconscious beliefs about money, usually formed in childhood, which we may not even realize we hold but which shape our financial decisions and behavior. An example of a money script is, “More money will make everything better.”
More about the key stages of a process in this article.:
MORTGAGE: -- A written instrument that creates a lien upon real estate as security for the payment of a specified debt.
MORTGAGE TAX: -- Tax on mortgages usually in the form of a stamp duty levied on the mortgage document.
MOTIVE TEST: -- Test often found in tax rules which are designed to prevent tax avoidance. For example, the rules may provide that certain consequences will follow if the sole, main or principal purpose of certain transaction is the reduction of tax.
MOU: -- See: Memorandum of Understanding
MULTINATIONAL ENTERPRISES (MNE): -- Company or group of companies with business establishments in two or more countries.
Multiple: Often referred to as investment multiple, this is a valuation metric which divides a company’s enterprise value by its ‘EBITDA’. Different businesses will be acquired and sold on a multiple of their earnings, with higher multiples being an indicator of asset quality.
MULTIPLE CAPTIVES: -- Company which has more than one captive insurance company.
Multiple Ladder Talent Management Strategy: This approach to talent management involves having several talentpipelines for different groups of staff in the organisation, such asgraduates, senior management and general staff, which aims to nurture awide range of skills, not just leadership and management.
Multisensory learning: engages the learner and increases retention by using different senses. When the brain receives information visually, it stores that content differently than if the information was heard or gained using the other senses. If more senses are involved in learning, more of the brain is involved in storing the information.
MULTI-STAGE TAX SYSTEM: -- Indirect tax charged on the same goods at successive stages of production and distribution.
Municipal Bond: A debt security issued by a state, county, city, or other political entity (such as a school district) to raise public funds for special projects. The income from municipal bonds is normally exempt from federal income taxes. It may also be exempt from state income taxes in the state in which the municipal bond is issued. Bond prices rise and fall daily. Municipal bonds are subject to a variety of risks, including adjustments in interest rates, call risk, market conditions, and default risk. Some municipal bonds may be subject to the federal alternative minimum tax. When interest rates rise, bond prices generally will fall. Certain municipal bonds may be difficult to sell. A municipal bond issuer may be unable to make interest or principal payments, which may lead to the issuer defaulting on the bond. If this occurs, the municipal bond may have little or no value. If a bond is purchased at a premium, it may result in realized losses. It’s possible that the interest on a municipal bond may be determined to be taxable after purchase.
Municipal Bond Fund: A mutual fund that specializes in investing in municipal bonds. Bond funds are subject to the same inflation, interest-rate, and credit risks associated with their underlying bonds. As interest rates rise, bond prices typically fall, which can adversely affect a bond fund's performance. The principal value of bond funds fluctuates with changes in market conditions. Shares, when sold or redeemed, may be worth more or less than their original cost. Mutual funds are sold by prospectus. Please consider the investment objectives, risks, charges, and expenses carefully before investing. The prospectus, which contains this and other information about the investment company, can be obtained from your financial professional. Be sure to read the prospectus carefully before deciding whether to invest.
MUTUAL AGREEMENT PROCEDURE (MAP): -- A means through which tax administrations consult to resolve disputes regarding the application of double tax conventions. This procedure, described and authorized by Article 25 of the OECD Model Tax Convention, can be used to eliminate double taxation that could arise from a transfer pricing adjustment.
MUTUAL ASSISTANCE: -- "Mutual assistance" in the context of tax treaties is that one of the contracting states will collect taxes due to the other contracting state. See optional Article 27 of the OECD Model.
Mutual Fund: A pooled investment account offered by an investment company. Mutual funds pool the monies of many investors and then invest the money to pursue the fund’s stated objectives. The resulting portfolio of investments is managed by the investment company. Mutual fund balances are subject to fluctuation in value and market risk. Shares, when redeemed, may be worth more or less than their original cost. Mutual funds are sold only by prospectus. Individuals are encouraged to consider the charges, risks, expenses, and investment objectives carefully before investing. A prospectus containing this and other information about the investment company can be obtained from your financial professional. Read it carefully before you invest or send money.
Myers-Briggs Type Indicator (MBTI): is an instrument that helps determine personality type based on preferences for extraversion or introversion, intuiting or sensing, thinking or feeling, and judging or perceiving. It’s often used in career development and team building.
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NASDAQ: A U.S. stock market trading in approximately 3200 companies. Reports that the NASDAQ is up or down refer to the average increases or decreases in all the stocks traded through NASDAQ that day.
National Association of Securities Dealers Automated Quotations (NASDAQ): An American stock exchange originally founded by the National Association of Securities Dealers. When the NASDAQ stock exchange began trading on February 8, 1971, it was the world’s first electronic stock market.
NATIONALITY PRINCIPLE: -- The nationality of a taxpayer may affect the manner in which he is taxed and the nature of his tax burden, but comprehensive income tax treaties commonly provide that foreign taxpayers should not suffer discriminatory taxation by reason of their nationality.
Needs analysis: is a systemic process of collecting and synthesizing data and information to determine the difference between the current condition and the desired future condition.
Needs Assessment: Identify performance requirements and the knowledge, skills, and abilities needed by an agency's workforce to achieve the requirements. A needs assessment is the process of identifying the "gap" between performance required and current performance.
NEGATIVE INCOME TAX: -- A proposed system of providing financial aid to poverty-level individuals and families, using the mechanisms already in place to collect income taxes. Low-income person or family would receive a direct subsidy, called a negative income tax.
NEGLIGENCE: -- A lack of due care or failure to do what a reasonable and ordinarily prudent person would do under the given circumstances.
Net Asset Value: The net market value of a mutual fund’s current holdings divided by the number of outstanding shares. The product of this division estimates the per-share value of the fund’s assets.
Net Income: A company’s total revenues minus its costs, expenses, and taxes. Net income is the bottom line of a company’s income statement (which may also be called the profit and loss statement).
NET OPERATING LOSS: -- Amounts by which business expenses exceed income in a tax year. A trader's operating losses constitute broadly the excess of his operating expenditure over receipts from his operations.
NET PROFIT: -- Difference between receipts from business transactions and deductible business expenses, subject to any adjustments for tax purposes.
NET PROFIT MARGIN: -- Ratio of operating profits to gross income (or revenue)
NET WEALTH TAX: -- See: Net worth tax
NET WORKING CAPITAL: -- Current assets less current liabilities.
Net Worth: The value of all your assets (savings, investments, real estate, personal property, money owed to you, etc.), minus all your liabilities (mortgage, auto loans, education loans, credit card debt, etc.).
NET WORTH TAX: -- Many European countries impose the net worth tax in the context of property taxation. The taxable base for resident taxpayers is normally the taxpayer's worldwide net worth, i.e. total assets less liabilities along with deductions and exemptions specially allowed by tax laws.
Networking: An activity that business people take part in, in order to generate newbusiness contacts and links. It is seen as a more productive and costeffective alternative to advertising as it allows individuals to develop solidbusiness relationships.
Neuroplasticity: describes the brain’s ability to reorganize itself, both physically and functionally, due to environmental, behavioral, learning, and emotional influences.
New York Stock Exchange (NYSE): A stock exchange located on Wall Street in New York City, NY. Many regard the NYSE as the largest exchange in the U.S., and possibly in the world.
Next of kin: – generally understood to be the person or persons closest to you, and whom you would want contacted in an emergency. In succession law there is no specific legal definition. Succession statutes can refer to spouses/partners separately from relations by blood, for example father, mother, sister, brother, children. The law allows for people to specify in their will who they regard as their ‘next of kin’, providing they use clear and appropriate language. When a deceased has not left a will, there is an order prescribed by legislation as to who takes their estate, which is spouse/partner and family based.
NEXUS Link.: -- Often a requirement in tax law for determination of taxability or deductibility. For example, expenses are deductible if they have a “nexus” with gross income. In US, the taxable income of a multistate corporation may be apportioned to a specific state only if the corporation has a sufficient nexus in the state.
NOMINAL CAPITAL: -- Amount of capital that is defined as such in the articles of incorporation. Usually, a certain minimum amount of nominal capital is required to establish a legal entity.
NOMINAL VALUE: -- See: Par value
NOMINATIVE SECURITIES: -- See: Registered securities
Non-Compete Agreement: A Non-Compete Agreement prevents one party from competing with another for a specific period of time within a defined geographic area. When deciding whether to enforce a non-compete agreement, courts often look to a variety of factors, including the reasonableness of scope of activities prohibited, time period, geographic restrictions, and when the agreement was signed.
Non-contributory Retirement Plan: A retirement plan that is funded entirely by employer contributions, with no employee contributions.
Non-critical Skill: These skills are not essential to complete task, but are desirable as theyallow for tasks to be completed more quickly and efficiently, or at a lowercost than would otherwise be the case.
NON-DISCRIMINATION: -- Tax treaties frequently contain a "non-discrimination" article which stipulates that citizens or nationals of one country resident in the other country may not be subjected to local taxation which is different from or more burdensome than the tax to which citizens and nationals of the host country are subjected under the same circumstances (including as to residency).
Non-Executive: A non-executive can be a director (NED or NXD) or chairman (NEC or NXC) of a company who is a member of the board but who is neither an employee nor part of the executive management team. Typically these are experienced individuals who add strategic and operational expertise to an existing management team.
Non-Government facility: the government of a State or of a territory or possession of the United States including the Commonwealth of Puerto Rico, and an interstate governmental organization, or a unit, subdivision, or instrumentality of any of the foregoing;a foreign government or international organization, or instrumentality of either, which is designated by the President as eligible to provide training under this chapter;a medical, scientific, technical, educational, research, or professional institution, foundation, or organization;a business, commercial, or industrial firm, corporation, partnership, proprietorship, or other organization;individuals other than civilian or military personnel of the Government; andthe services and property of any of the foregoing furnishing the training.
Non-qualified Plan: A retirement or employee benefit plan that is not eligible for favorable tax treatment.
NON-QUALIFIED STOCK OPTION: -- A stock option that does not meet the incentive stock option requirement under US tax law. The spread is taxed as ordinary income.
NON-RECOURSE DEBT: -- A debt for which an individual has no personal liability. For example, a lender may take the property pledged as collateral to satisfy a debt, but has no recourse to other assets of the borrower.
NON-RESIDENT: -- Broadly speaking, a person who spends most of the calendar year outside his country of domicile. Non-residents are usually taxed on income derived from sources within the taxing jurisdiction whereas residents may be taxed on worldwide income.
NON-RESIDENT ALIEN: -- A non-resident individual who is not a citizen or national of the taxing jurisdiction.
NOTICE OF ASSESSMENT: -- The written decision of the tax authorities after a review of a taxpayer's return, whereby the amount of taxable income is determined and the amount of tax due is calculated.
NOTICE OF DEFICIENCY: -- See: Deficiency
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Object: – a legal term used in trusts law. An object of a trust is a beneficiary of that trust. In wills where a gift is made to a particular group or class of people, an object means someone from that goup. For example the group might be described in a will as ‘my children’ or ‘my nieces and nephews’.
Objective: is a target or purpose that, when combined with other objectives, leads to a goal.
Observation: occurs when participants are told to witness an event and be prepared to share their reflections, reactions, data, or insights. This also is a methodology for data collection.
Occupational Assessment: Examines the skills, knowledge, and abilities required for affected occupational groups. Occupational assessment identifies how and which occupational discrepancies or gaps exist, potentially introduced by the new direction of an agency. It also examines new ways to do work that can eliminate the discrepancies or gaps.
OECD: -- The OECD (Organization for Economic Co-operation and Development) is a multilateral organization comprised of 30 countries, which are mostly Western European countries and other industrialized countries including US and Japan. Founded in 1961, the OECD provides a forum for representatives of countries to discuss and attempt to coordinate economic and social policies. It has an especially significant role in international tax matters. Its website is www.oecd.org.
OECD MODEL TAX TREATY: -- See: Model tax treaty
OFFENCE, TAX: -- Tax offences may be specified in the tax laws covering matters such as late filing, late payment, failure to declare taxable income or transactions, and negligent or fraudulent misstatements in tax declarations.
OFFICE: -- For purpose of the application of a tax treaty, the office of an enterprise normally forms a permanent establishment if the business of that enterprise is wholly or partly carried on through that office.
OFFICE AUDIT: -- An examination at a tax authority’s office, generally of an uncomplicated tax matter.
OFFSHORE BANK: -- Offshore banking business basically consists of borrowing in foreign currencies for non-resident depositors outside the country and relending the foreign currencies to other non-residents. A number of countries have special regime for the taxation of offshore banks.
OFFSHORE COMPANY: -- Term usually applied to a company registered in a country (often a tax haven) other than the country or countries in which it carries on its business activities. An offshore (or non-resident owned) company is commonly used for captive insurance, marketing abroad, international shipping and tax shelter schemes.
OID: -- See: Original issue discount
OJT: (On-the-Job Training), one of the oldest forms of training, is a delivery system that dispenses training to employees as they need it.
Old-Age, Survivors, and Disability Insurance (OASDI): The official name of the Social Security program. In addition to retirement benefits, it offers disability income, veterans’ pensions, public housing, and food stamps.
OMBUDSMAN: -- A member of the US IRS Commissioner's immediate staff who directs the IRS's Problem Resolution Program
On the Job Training: Formal methods/activities planned and structured to promote learning by doing; e.g., detail assignments/programs.
Onboarding: is the process through which organizations equip new employees with the knowledge and skills they need to succeed at their jobs.
ONE HUNDRED AND EIGHTY-THREE (183) DAYS' RULE: -- Presence in a country for 183 days or more in any 12-month period may have tax consequences, particularly in respect of an individual's residence for tax purposes or for the taxation of employment income (although other tests must also be met).
Online Survey: These surveys are commonly used to gather data due to the quick andeasy nature of them. Attention should be paid to the fact that they shouldnot be used alone as the data may be skewed by personal opinions.
ONSHORE COMPANY: -- Term sometimes used to denote the converse of offshore company.
ONUS OF PROOF: -- The burden and responsibility of proving an assertion. Widely adopted principle in tax law, for example, where the taxpayer has the basic responsibility of declaring his taxable income or transactions.
Operating Agreement: The Operating Agreement is the document that sets forth the framework for decision making and operation of LLCs, and is similar to bylaws for corporations. While the document does not need to be filed with the Secretary of State, it is often requested by lenders, investors, and potential business partners. For multiple-member LLCs, the Operating Agreement serves to memorialize agreements and understandings among founders. For single-member LLCs, the Operating Agreement is evidence that the company is deserving of limited liability protection, and positions the company for growth through either debt- or equity financing.
OPERATING LEASE: -- Lease where the lessor is regarded as the owner of the leased asset for tax purposes. Cf. Finance Lease
OPTION: -- Derivative financial instrument consisting of a firm agreement granting one party the right but not the obligation to buy or sell commodities, securities or currencies at a specified future date at a specified price.
OPTION TO BE TAXED: -- In the VAT context, a VAT exempt entrepreneur sometimes can claim to be subject to VAT, the advantage being that to be entitled to his input tax against his output tax.
or tennants in common: – a type of property ownership where two or more people own a defined, undivided share (for example one quarter, three quarters) in the same property. Although they possess the whole property in common, they can individually and independently of each other dispose of their share during their lifetime or through their will to whomever they choose. Contrast to
ORDINARY SHARES: -- Ordinary shares (also known as common stock) are generally shares with an equal par value and bear equal rights and obligations such as the right to participate in the management of the company by voting at the shareholders' meeting and the right to receive dividends. The rights of ordinary shareholders to receive dividends are generally subordinate to the rights of bond holders and preference shareholders.
Organization Development (OD): is the process of developing an organization so that it’s more effective in achieving its business goals. OD uses planned initiatives to develop the systems, structures, and process in the organization to improve effectiveness.
Organizational Assessment: Evaluates the level of organizational performance. An assessment of this type will determine what skills, knowledge, and abilities an agency needs. It determines what is required to alleviate the problems and weaknesses of the agency as well as to enhance strengths and competencies, especially for Mission Critical Occupation's (MCO).
ORIGIN PRINCIPLE: -- Principle under a VAT regime where goods are taxed in the country where they are produced, i.e. they are taxed on the basis of their place of production or origin.
ORIGINAL ISSUE DISCOUNT (OID): -- A discount from par value at the time a bond is issued. The most extreme version of an OID is a zero-coupon bond, which is originally sold far below par value and pays no interest until it matures.
Originating process –: a document which starts legal proceedings in a court.
Other Formation Documents: In addition to choosing the type of entity, filing the appropriate paperwork with the Secretary of State, and an Operating Agreement or Corporate Bylaws, Other Formation Documents add to the complexity of starting a company. For an LLC, Subscription Agreements memorialize the exchange of initial capitalization for ownership between each founder and the company, while Membership Certificates function as the equivalent of corporate stock for LLCs. For corporations, Other Formation Documents often include the Action by Initial Consent of Incorporator, Initial Organizational Meeting by the Board of Directors, Stock Certificates, and Restricted Stock Purchase Agreements. Regardless of the type of entity, an Inventions Assignment Agreement usually should be signed by all founders, to avoid disputes over the ownership of any intellectual property used or developed by the new company.
OTHER INCOME: -- Income not otherwise mentioned in a tax treaty is frequently dealt with in a separate article, entitled "other income".
Out of wedlock: – or
OUTBOUND TRANSACTION: -- Term which refers to the tax treatment of a country's residents (and perhaps citizens) doing business and investing abroad.
OUTPUT TAX: -- Term used in connection with VAT to denote the tax payable on the sales of goods or services by those who are subject to the tax and in contrast to the input tax for which a credit will be available.
overall score: The total of all individual scores of all matching content items in a best-fit analysis.
Overhead Costs: Overhead costs are any costs associated with developing a course such as contractor costs or, if in-house, salary of agency staff to develop the course, building space, utilities, furniture, and any other indirect costs not associated with course delivery. Ideally, these costs will be factored into individuals’ training reported to OPM, however, for now agencies may consider overhead as the cost of the LMS, online libraries and Commercial off the shelf (COTS) products procured for training.
OVERHEAD EXPENSES: -- The general expenses of a business as opposed to the direct cost of producing a good or service. "Overhead costs" is a term which may, in tax matters, also be used for costs incurred by the head office of a concern for the benefit of branches or subsidiaries.
OVERSEAS: -- In the United Kingdom the term "overseas" is generally used instead of "foreign" because "foreign" cannot be applied to commonwealth countries or to territories which are British possessions, such as the British Virgin Islands, the Isle of Man and the Channel Islands.
Succession Planning: P
PAID-IN CAPITAL: -- The capital received by a corporation from investors for stock, as distinguished from capital generated by earnings or donated.
PAPER COMPANY: -- See: Letter-box company
PAR VALUE: -- Assigned value printed on a share certificate. Face value.
PARENT COMPANY: -- Company with a substantial participation in the share capital of another company, called the subsidiary.
Partial intestacy: – when a will does not effectively dispose of all of the deceased’s property, or the will is worded in a way so that a part of the estate is not dealt with effectively.
PARTICIPATION EXEMPTION: -- See: Affiliation privilege
Partition –: The judicial separation of the respective interests in property of joint owners or tenants in common so each may take possession, enjoy and control his or her share of the property.
PARTNER: -- A member of partnership
PARTNERSHIP: -- Association of two or more person (individuals or companies) formed for the purpose of making a profit. A partnership can be a general partnership or a limited partnership depending on the extent of each party's liability. A general partnership is characterized by the unlimited liability of the general partners for partnership debts. Also see: Limited partnership.Some countries treat a partnership as a separate taxpayer and may subject it to tax on its income and losses as a corporation. Other countries do not consider a partnership to be a separate legal entity and the partnership is treated as tax transparent, with each individual partner being taxed on his share of the profits according to his interest in the partnership. Taxation of partnerships is addressed in the Commentary to Article 1 of the OECD Model.
PASSIVE INCOME: -- Income in respect of which, broadly speaking, the recipient does not participate in the business activity giving rise to the income, e.g. dividends, interest, rental income, royalties, etc.
PASS-THROUGH ENTITY: -- A nontaxable entity such as a partnership. Generally, the income or expense is passed to the underlying owner.
PATENT: -- Form of intellectual property. The inventor of a new article or process usually registers his invention with a government department which confers on him the sole right (known as a patent right) to use the invention for a limited period of time.
PATRON: -- A person who does business with a cooperative, but is not necessarily a member.
PATRONAGE DIVIDEND: -- A payment to a patron of a cooperative.
Pay on death (POD) –: Designation naming of a beneficiary to receive an account balance on a party’s death.
PAYROLL TAX: -- Tax charged on an employer's payroll (i.e. gross salaries, wages and other remunerations) paid to his employee without regard to their domicile, family status or other individual circumstances.
PE: -- See: Permanent establishment
Pecuniary: – relating to money.
Pedagogy: is the art or practice of teaching that usually refers to children. Pedagogy focuses on the skills teachers use to impart knowledge and emphasizes the teacher’s role. It is contrasted with andragogy, the teaching of adults, which focuses on the learner who is assumed to be self-directed and motivated to learn. See also andragogy.)
PENALTIES: -- Administrative penalties are imposed for tax offences, such as failure to make a timely return or payment, negligence, and making a false return or statement. They take the form of additions to the tax and are assessed as part of the tax. Criminal penalties, on the other hand, are enforceable only by prosecution. A prison sentence may be imposed for serious tax fraud.
PER CAPITA: -- Latin for "for each person"
PER DIEM: -- Latin for "by the day"; referring to daily allowance, usually for travel, entertainment, employee compensation, or miscellaneous out-of pocket expenses incurred while conducting a business transaction.
Performance Appraisal: This is a method in which the job performance of an employee isevaluated. Performance appraisals are a part of career development andconsist of regular reviews of employee performance within organisations.
performance document: Online document used to evaluate a worker for a specific time period. The document contains the content on which the worker is evaluated, which could include goals, competencies, and questionnaires.
performance goal: A results-oriented goal, often using specific targets, to assess the level of a worker's achievement.
Performance Improvement: is a holistic and systematic approach to meeting organizational goals by identifying and closing human performance gaps.
Performance Management: is the ongoing communication process between supervisors and employees to establish expectations that support accomplishing the organization’s strategic objectives, including clarifying expectations, setting objectives, providing feedback and coaching, and reviewing results.
Performance Support: provides just enough information to complete a task when and where a performer needs it. The support is embedded within the natural workflow and is organized for use within a specific context, such as the location or role that requires completion.
Permanent Capital: Capital (money) provided by the PE investor from their PE fund. This is expensive capital compared to bank debt. Normally put into a business with a matching loan note so the capital amount itself is protected if the equity price falls to zero.PE investors want a return of 2.5x – 3x on their permanent capital. Some investments “pop” and can do 4,5,6, 7x or more.
PERMANENT ESTABLISHMENT (PE): -- Term used in double taxation agreement (although it may also be used in national tax legislation) to refer to a situation where a non-resident entrepreneur is taxable in a country; that is, an enterprise in one country will not be liable to the income tax of the other country unless it has a "permanent establishment" thorough which it conducts business in that other country. Even if it has a PE, the income to be taxed will only be to the extent that it is ‘attributable’ to the PE.
Permanent Life Insurance: A class of life insurance policies that do not expire—as long as premiums are kept current—and which combine a death benefit with a savings component. This savings portion can accumulate a cash value against which the policy owner may be able to borrow funds. Several factors will affect the cost and availability of life insurance, including age, health and the type and amount of insurance purchased. Life insurance policies have expenses, including mortality and other charges. If a policy is surrendered prematurely, the policyholder also may pay surrender charges and have income tax implications. You should consider determining whether you are insurable before implementing a strategy involving life insurance. Any guarantees associated with a policy are dependent on the ability of the issuing insurance company to continue making claim payments.
person profile: A collection of skills, experience, qualifications, work preferences, and career planning information for a worker.
PERSONAL ALLOWANCES: -- Personal allowances are granted to individuals as deductions from income in computing their taxable income. There is usually a deduction for the individual himself, spouse, children and other dependents.
PERSONAL HOLDING COMPANY: -- Company, the shares of which are principally owned by or attributed to the taxpayer, and which is set up to receive his investment income.
PERSONAL PROPERTY: -- Things movable, as distinguished from real property or things attached to the realty; also called “personalty”.
Personal property –: Assets whose ownership arises out of physical possession of the property or asthe result of a document showing ownership. Almost anything not classified as real property (real estate) is personal property. Examples include livestock, machinery, stored grain, bank deposits, stocks and bonds, checking and savings accounts, automobiles, and other transportation and recreation vehicles.
Personal representative –: A person named in a will or appointed by the district court to administer the estate of a decedent. Formerly referred to as executor or administrator.
Personal Representative (or Executor or Special Administrator).: Someone appointed by a person in a Will or by the Court to carry out the Will’s provisions or the distributions pursuant to statute. A “co-personal representative” acts as personal representative with another or others. A "successor" personal representative takes the place of a personal representative who can no longer hold office.
Personal representatives: – of a deceased person are executors (if a will was left) or administrators on intestacy.
PERSONAL SERVICE CORPORATION: -- A corporation the principal activity of which is the performance of personal services; for example, a management consulting company which sends its personnel to prepare a report on a client company.
Personality Assessment: Focus on an individual’s style or manner of doing things, as well as howthey interact with their environment and other people. Theseassessments come in a variety of different formats and provide apersonality profile rather than a score (because there are no right orwrong answers).
PETITION: -- A written application addressed to a court or judge, and stating facts and circumstances relied upon as a cause for judicial action.
PHANTOM STOCK PLAN: -- A deferred-compensation plan that uses the employer's stock in the business as a measuring rod for determining the value of the compensation payment. Hypothetical shares of stock are allocated to the employee, and accrued appreciation and/or dividends to the hypothetical shares are paid in cash to the employee.
PIERCING THE CORPORATE VEIL: -- The process of imposing liability for corporate activity, in disregard of the corporate entity, on a person or entity other than the offending corporation itself; a US legal doctrine.
PITFALLS OF PROBATE: Basic Estate Planning, including Living Trusts, Wills, Durable Powers of Attorney, etc. can help your heirs avoid the stress, delays and costs often associated with probate.
PLACE OF EFFECTIVE MANAGEMENT: -- Place of effective management is the test suggested in the tie-breaker rule of the OECD model tax treaty to determine the residence of a company where under the domestic laws of both contracting states the company is resident in both of them. The test determines that in such cases the company would, for treaty purposes, be resident in the state in which its place of effective management is situated.
PLACE OF MANAGEMENT: -- For purposes of the application of a tax treaty, the place of management of an enterprise normally forms a permanent establishment. The term "place of management" as such is not defined in the OECD model tax treaty, but may be defined in national tax law.
Plan: A qualified retirement plan available to eligible employees of companies. 401(k) plans allow eligible employees to defer taxation on a specific percentage of their income that is to be put toward retirement savings; taxes on this deferred income and on any earnings the account generates are deferred until the funds are withdrawn—normally in retirement. Employers may match part or all of an employee’s contributions. Employees may be responsible for investment selections and enjoy the direct tax savings.
Podcast: A type of online media delivery allowing users to download files via a feed onto a computer and MP3 player. Podcasts allow learners to access trainings at different times depending on workload and availability. Instructors create course podcasts for learners to download and listen on their MP3 player, mobile phone, and laptop.
Policy Loan: A loan made by an insurance company to a policyholder. Policy loans are secured by the cash value of a life insurance policy. Withdrawals of earnings are fully taxable at ordinary income tax rates. If you are under age 59½ when you make the withdrawal, you may also be subject to a 10% federal income tax penalty. Also, withdrawals may reduce the benefits and value of the contract.
Policy Rider: A provision to a life insurance policy that is purchased separately from the basic policy and that provides additional benefits at additional cost.
Policyholder: The person or entity who holds an insurance policy; usually the client in whose name an insurance policy is written.
POOL BASIS: -- Collective basis for the purpose of depreciation of business assets falling within the same category. For example, all depreciable assets of a similar kind are effectively treated as a single asset for depreciation purposes.
Pooled Income Fund: A trust created by a charitable organization that combines the contributions of several donors and distributes income to those donors based on the earnings of the trust. The trust is managed by the charitable organization, and contributions are partially deductible for income tax purposes.
Portfolio: The combined investments of an individual investor or mutual fund.
PORTFOLIO INTEREST: -- Category of interest that may be paid from US sources free of withholding tax provided certain requirements are met. The portfolio interest exemption does not apply to bank loans made in the ordinary course of business.
PORTFOLIO INVESTMENT: -- A portfolio investment in a company would be a holding of shares amounting to a small portion of the total shares of the company, e.g. less than 10%. Portfolio investors may receive different tax relief or other treatment in respect of their dividends under tax treaties from those accorded to other direct investors.
position: A specific occurrence of one job that's fixed within a department. It's also often restricted to one location. For example, the position Finance Manager is an instance of the job Manager in the Finance Department.
Position Requirements: The competencies required by the holder of a position
Positive Behaviours: These are ways of acting that will have a positive influence on you, yourcolleagues and the workforce. Being optimistic, having new ideas andsupporting your co-workers are all positive behaviours. As well asinfluencing the workplace for the better positive work behaviours will alsonot go unnoticed by those senior to yourself and increase your chances ofcareer progression.
POSSESSIONS OF U.S.: -- In general, any US island, cay or reef that is not part of any of the 50 states. For tax purposes, possessions include Puerto Rico, the Virgin Islands, the Marshall Islands, the Federated States of Micronesia, American Samoa, Guam, the Canal Zone, Mariana Islands, Johnson Island, and Wake Island.
Post-Completion Plan: This is a list of things to work on after the deal is complete. Sometimes called the 100 day plan as there is a hope that it might all get done in the first 3 months.As you go through your process, your investor and diligence providers will unearth things that are not ideal or need to be fixed but are not severe enough to derail the acquisition. These get dropped onto the post-completion plan.Don’t worry too much about this, just let it happen.Once completion is done and you’ve had a holiday you can re-look at the list and edit then – its much easier to have the argument that something isn’t really important at that stage.
Post-deal slump: It’s not uncommon for an asset to grow slower during the first year of PE ownership than before. In fact some companies can struggle or even go backwards in year 1 and this is a situation reported by many of my CEO colleagues in PE and a number of PE funds.The reasons for this can include :The management team has been hugely distracted for the nine months prior to the sale (by doing the sale) and that can impact negatively on product, business and organisational development.The management team is exhausted by the sale process, confused by their new ownership structure and struggling under the weight of “helpful” suggestions from the diligence providersTrying to do too many new things at once in an effort to grow the business faster actually makes it go slower. A classic example of this is adding too many new sales people that then consume management resources to recruit and train so sales go backwards not forwards.In an effort to maximise the sale price, your sell side advisor persuaded you to stretch all of the projections to the fringe of reason and in year one you have the hangover from that party!
Post-money valuation: This refers to the valuation of a company immediately after an investment or fundraising.
Power of Appointment.: The authority given by one person to another to decide who will receive and enjoy an interest in property. These may be “limited” or “general” and can have significant gift and estate tax consequences.
Power of Attorney: A document instructing another about how to act on your behalf, if you are unable to take actions for yourself. Examples include: Financial Power of Attorney, Health Care Power of Attorney, Special (or limited) Power of Attorney, and General Power of Attorney.
Power of attorney (POA) –: A written document in which one person gives another the power to conduct certain acts on his or her behalf.
Power of Attorney.: Authorization, by a written instrument, that one person (or entity) may act in another's place as agent or attorney-in-fact with respect to some or all legal and financial matters. The scope of powers and authority given under a particular power of attorney is spelled out in the document itself, and may be limited, or expanded, by statute in some states. Most powers of attorney are created to be “durable” so they do not expire or terminate upon the disability of the person making the power of attorney. However, all power of attorney documents, and powers, terminate upon the death of the person granting the power. The only exception to this is the very rare instance where the power is “coupled with an interest.”
Precatory words: – words used to express a wish or a hope.
PRECEDENT: -- The doctrine of precedent in Anglo-American legal system obliges courts to adhere to principles enunciated in previously decided cases when making adjudications in cases involving the same material facts and legal issues.
PREFERENCE SHARES: -- Shares which carry a right to a prior and usually fixed dividend, ahead of dividends paid to ordinary shareholders.
Preferred Stock: A class of stock with claim to a company's earnings, before payment can be made on the common stock, and that is usually entitled to priority over common stock if the company liquidates. Generally, preferred stocks pay dividends at a fixed rate.
PREMIUM: -- In the context of a derivative financial instrument, a premium is the amount a purchaser pays for an option. In the context of a bond or other debt instrument, it is the amount paid in excess of the face amount.
PREMIUM AT THE ISSUE OF SHARES: -- Excess of issue value over par value in issuing corporate shares. It is a contribution to capital and not taxed as profits.
Pre-money valuation: This refers to the valuation of a company prior to an investment or fundraising. Different metrics are used to determine this value, such as discounted P/E ratios and future cash flow.
Prenuptial Agreement: A legal agreement arranged before marriage stating who owns property acquired before marriage and during marriage and how property will be divided in the event of divorce. ERISA benefits are not affected by prenuptial agreements.
PREPARATORY ACTIVITIES: -- See: Auxiliary activities
PRESUMPTIVE TAXATION: -- Concept of taxation according to which income tax is based on "average" income instead of actual income.
PRE-TAX PROFITS: -- Profit after deducting depreciation, costs, etc., but before deducting taxes.
PRICE INCREASE RESERVE: -- Reserve to take account of expected increase in prices of goods, raw materials, etc. which must be replaced in the course of business.
Price/Earnings Ratio (P/E Ratio): The market price of a stock divided by the company's annual earnings per share. Because the P/E ratio is a widely regarded yardstick for investors, it often appears with stock price quotations.
PRIMARY ADJUSTMENT: -- An adjustment that a tax administration in a first jurisdiction makes to a company's taxable profits as a result of applying the arm's length principle to transactions involving an associated enterprise in a second tax jurisdiction.
Prime Interest Rate: The interest rate commercial banks charge their most credit-worthy or “prime” customers. The prime interest rate is influenced by the federal funds rate.
Primogeniture –: first-born, a first born’s right to inherit.
Principal: The original amount invested in a security, excluding earnings; the face value of a bond; or the remaining amount owed on a loan, separate from interest.
PRINCIPAL AMOUNT: -- The face value of an obligation, such as a bond or a loan, which must be repaid at maturity, as separate from the interest.
PRINCIPAL PLACE OF BUSINESS: -- The place where a person does business most of time.
Prioritising: Prioritising involves determining the order for dealing with a series oftasks according to their relative importance. This process can involveasking members of the business with extensive knowledge of theorganisation and who can be trusted to make good decisions to prioritiseareas for improvement, providing a list that the talent managementstrategy can target.
Private: An M&A transaction that does not require shareholder approval in a public forum either from the bidder, target or vendor shareholders.
Private annuity –: A means of transferring property from one owner to another by “selling” it for an unsecured promise to pay the original owner an income for life. The sale price is based on fair market value at the time of sale.
Private equity: A type of investment – or asset class – which includes shareholdings in companies that are privately owned and not publicly traded on a stock market. Read more about how private equity works.
PRIVATE RULING: -- Ruling granted by the tax authorities to a single taxpayer, usually with respect to a single transaction or series of transactions. Normally the ruling can be relied upon only by the taxpayer to whom it is issued, not by other taxpayers, and is binding upon the tax authority provided all relevant facts have been disclosed.
PRIVILEGE (DIPLOMATIC): -- Under the general rules of international law or under the provisions of special agreements, diplomatic agents and consular officers are in most cases exempt from tax in the state to which they are seconded. Many tax treaties include a clause that the right to tax income arising from outside the state is reserved to the sending state.
PRIVILEGED TAX REGIME: -- Euphemism for the tax regime of a tax haven.
PRO RATA: -- Latin for "proportionally"
PRO RATA RULE: -- Under most VAT systems, a credit for part of the input tax is allowed for VAT previously paid on goods and services when they are used in taxable and exempt (without credit) transactions and total transactions occurring during a calendar year.
Probate: – A court procedure for settling the personal and business affairs of a decedent by formally proving the validity of a will and establishing the legal transfer of property to beneficiaries, or appointing an administrator and supervising the legal transfer of property to heirs if no valid will exists. Probate rules vary state by state.
Probate –: a process by which the will or a document alleged to be the will of a deceased person is proven to be valid according to law. A
Probate court –: A court of law with the authority to verify the legality of a will and carry out its instructions.
Probate Court.: A court with the power to probate and settle Wills and administer intestate estates. In Maryland this power is given to the Orphan's Court; in DC and Virginia that power resides in divisions of the regular courts.
Probate Estate.: Those estate assets which fall within the jurisdiction of the probate court before being transferred to another person. Retirement accounts and life insurance proceeds, for example, are not generally part of the probate estate. Probate assets are assets titled in the name of the decedent, with no beneficiary designation and not jointly owned.
Probate.: A state level process that determines, among other things, the validity of a Will (if any), the value of probate assets at the time of death, and the validity of debts or claims against an estate. In probate the Register of Wills or Probate office will oversee accountings, income and disbursements from the estate. More information about Probate can be found here
Process: Normally the bulk of your purchase price is paid in permanent capital, with the rest being paid by senior debt then management rollover.A process is the project that results in an exit. So you’ll hear things like “Company X has just started running a process”.A process involves management, investors and advisors, normally an investment bank who manage the process as your representative to the market.
Professional Certification: A professional certification is an indicator of proficiency that takes into account the certification that is issued and recognized by a specific general professional community or industry that demonstrates a person’s proficiency in the competencies/KSAs needed to perform the job.
Professional Coach: An individual who offers support through an ongoing partnership designed to help individuals maximize their potential in their personal and professional lives.
Professional Development Plan (PDP): A PDP helps you to set out how you would like to develop. For example, itcan look at where you would like to be in 5 years time and what you needto do in order to get there.
PROFESSIONAL SERVICES: -- Services independently performed by members of the liberal professions (i.e. physicians, lawyers, accountants, etc.) and other activities of an independent character.
profile type: A template that defines the content sections of a profile, role access for each section, and whether the profile is for a person, or for a workforce structure such as a job or position.
PROFIT: -- Broadly, the excess of revenue over expenditure.
PROFIT AND LOSS STATEMENT: -- Income statement
PROFIT MARK-UP: -- Method to find an arm's length price, by taking the vendor's cost and adding an appropriate profit mark-up.
PROFIT METHOD: -- Method used in transfer pricing cases that looks at the profits arising from controlled transactions of one or more of the associated enterprises participating in such transactions.
PROFIT RATIO: -- Term used to denote the ratio of profits of an enterprise to its capital or net worth, and sometimes used as a basis for taxation.
PROFIT SHIFTING: -- Allocation of income and expenses between related corporations or branches of the same legal entity (e.g. by using transfer pricing) in order to reduce the overall tax liability of the group or corporation.
PROFIT SPLIT METHOD: -- Transfer pricing method that allocates the combined operating income or loss from a transaction among the separate parties by determining the relative value of each party's contribution to such overall profits or loss.
PROFITS TAX: -- Tax imposed on business profits in addition to ordinary income tax or as distinct from income tax imposed on other forms of income.
Profit-Sharing Plan: An agreement under which employees share in the profits of their employer. The company makes annual contributions to the employees' accounts. These funds usually accumulate tax deferred until the employee retires or leaves the company.
PROGRESSION: -- The rates of individual income tax are usually progressive, i.e. an increasing proportion of income must be paid in tax as the income increases.
Project Management: is the planning, organizing, directing, and controlling of resources for a finite period of time to complete specific goals and objectives.
Property: Anything over which a person or business has legal title. Property may be held in common or privately owned.
PROPERTY TAX: -- Group of taxes imposed on property owned by individuals and businesses based on the assessed value of each property.
Propound: – to propose or put forward a document for consideration and acceptance by the court as a valid will, as being the last will and testament of the deceased, when applying to the court for a grant of probate. The person applying for probate of a will is said to be the propounder of the will, or they seek to propound the will. Usually this person is the executor named in the will.
PROPRIETORSHIP: -- An unincorporated business owned by a single person. The individual proprietor has the right to all the profits from the business and also the responsibility for all its liabilities.
Prospectus: A document provided by investment companies to prospective investors. The prospectus gives information needed by investors to make informed decisions prior to investing in a specific mutual fund, variable annuity, or variable universal life insurance. The prospectus includes information on the minimum investment amount, the investment company's objectives, past performance, risk level, sales charges, management fees, and any other expense information about the investment company, as well as a description of the services provided to investors in the investment company.
PROTOCOL: -- Signed document containing the points on which agreement has been reached by the negotiating parties preliminary to a final treaty. For tax purposes, a protocol is signed and ratified by the parties in addition to an existing tax treaty. The protocol may be signed simultaneously with the tax treaty or later, and it clarifies, implements or modifies treaty provisions.
PROVISIONAL ASSESSMENT: -- Assessment of tax made before it is possible to make a final assessment which is often based on, for example, estimated figure or the previous year's figures.
Psychometric Test: According to the British Psychological Society, a psychometric test is “anyprocedure on the basis of which inferences are made concerning aperson’s capacity, propensity or liability to act, react, experience or tostructure or order thought or behaviour in particular ways.” Psychometrictests therefore provide in-depth information about the mind-set ofindividuals with the potential talent, identifying their strengths andweaknesses so these can be improved to ensure they reach their fullpotential in the future (Van Der Merwe, 2002).
Public: A transaction that requires approval either from the bidder, target or vendor shareholders in a public forum.
Public Trustee –: a statutory authority or government office. Established by an Act of Parliament a Public Trustee exists to provide trustee services, will services, act as executors, as administrator for intestate estates, financial management services and powers of attorney among others. Each state and territory have their own Public Trustee.
PUBLICLY HELD CORPORATION: -- A corporation that has a class of common stock registered on a national stock exchange; a US concept.
PUBLICLY TRADED LIMITED PARTNERSHIP (PTLP): -- Partnership in the US that is listed and traded on an established stock exchange or a secondary market. With some exceptions, PTLPs are taxed in the US as corporations rather than partnerships.
PUT OPTION: -- Contract under which the holder of the option has a right but not an obligation to sell securities or commodities, including foreign currencies, for a specified price during a specified period.
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Qualified Domestic Relations Order (QDRO): At the time of divorce, this order would be issued by a state domestic relations court and would require that an employee's ERISA retirement plan accrued benefits be divided between the employee and the spouse.
Qualified Personal Residence Trust (QPRT): . A Qualified Personal Residence Trust or QPRT is a trust that allows the grantor to remove a personal residence from their taxable estate as a way to reduce its value for gift tax purposes when transferring the property to a beneficiary.
Qualified Retirement Plan: A pension, profit-sharing, or qualified savings plan that is established by an employer for the benefit of the employees. These plans must be established in conformity with IRS rules. Contributions accumulate tax deferred until withdrawn and are deductible to the employer as a current business expense.
QUARANTINING: -- In the context of the foreign tax credit system, this term denotes the separate calculation of the foreign tax payable on all foreign income of a particular category which may be credited against the domestic tax payable on that category of foreign income.
Quitclaim deed -: A legal instrument used to convey whatever title held by the grantor. It contains no covenants, warranties, nor implication of the grantor’s ownership.
QUOTED SECURITIES: -- This term denotes the securities which have been admitted to an official stock exchange and are traded therein through sale, purchase or other disposal.
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RAMSAY CASE: -- The Ramsay case (W.I. Ramsay Ltd. v. IRC, Eilbeck (Inspector of Taxes) v. Rawling), decided by the UK House of Lords in 1981, involved complicated tax avoidance scheme which were marketed in the UK in the 1970s. The case established that a series of transactions with the purpose of tax avoidance, which ultimately cancelled each other out, could be ignored for tax purposes.
Ranking: The value of a successor to the position if they became the holder of the position
Rapid Instructional Design (RID): is a flexible approach to the conventional ISD model that uses a collection of strategies to quickly produce instructional packages. RID strategies include incorporating existing material, using templates, and using subject matter experts efficiently.
Rate of Return: A measure of the performance of an investment. Rate of return is calculated by dividing any gain or loss by an investment’s initial cost. Rates of return usually account for any income received from the investment in addition to any realized capital gains.
RATES: -- Local tax levied in Ireland and previously the UK. Rates are levied on the occupiers of real property on the basis of the annual rental value of the property.
RATIFICATION: -- The formal legislative consent or acceptance required by the constitution or domestic law of a country before a treaty to which it is a party can come into effect.
rating model: A scale used to measure the performance and proficiency of workers.
Readiness: How ready a successor is to assume a position
Real Estate Investment Trust (REIT): A pooled investment that invests primarily in real estate. REITs trade like stocks on the major exchanges. Keep in mind that the return and principal value of REIT prices will fluctuate as market conditions change. And shares, when sold, may be worth more or less than their original cost.
Real property –: Ownership rights in land and its improvements; for example, real estate, minerals, royalty interests, growing timber, land, and buildings attached to the land.
REAL PROPERTY (REAL ESTATE): -- Land and everything more or less attached to it. Also referred to as “Realty”.
REALIZATION: -- A legal concept referring to a time when rights have become legally receivable or obligations have become legally payable.
REALIZED GAIN/LOSS: -- Actual gain/loss realized from the disposal of an asset.
Realty: – real estate
Reasonable Accomodation: Reasonable accommodation is any change to a job, the work environment, or the way things are usually done that allows an individual with a disability to apply for a job, perform job functions, or enjoy equal access to benefits available to other individuals in the workplace. Agencies are required by law to provide reasonable accommodation to qualified individuals with disabilities, unless doing so would impose an undue hardship to the agencies. In addition, Executive Order 13164 requires Federal agencies to develop written procedures for providing reasonable accommodation.
REBATE: -- Term which in certain countries is synonymous with a tax credit.
Recapitalisation: This refers to the reorganisation of a company’s capital structure, being the proportion of equity to debt.
RECIPROCITY PRINCIPLE: The principle of give-and-take operates in a variety of tax contexts (particularly in the case of tax treaties) where an exchange of tax privileges between countries is desired. Reciprocity is a basis for relieving a taxpayer under domestic law, e.g. relief is granted for foreign tax if the other country gives corresponding or equivalent relief.
Recommended: A friendly transaction where the parties involved reach agreement over the terms of the deal normally prior to the acquisition being formally announced through a joint press release.
RECOURSE: -- The ability of a lender to claim money from a borrower in default, in addition to the property pledged as collateral.
RECOVERY OF TAX: -- From the taxpayer's point of view, this may mean a refund of tax. From the tax authorities’ point of view, it may mean the collection of tax which is in arrears.
Recruitment: Is the process of attracting and selecting people that best suit a job role.Recruitment will take place when people leave an organisation, when afirm is expanding and when current employee skill sets no longer meetcompany objectives and training is not an option.
Red Flags: For all the money that you spend on due diligence you would think they would come up with something concrete that you can rely on. This is not how it works.Due Diligence Advisors try and get away with saying as little as possible that they can be sued for in the future. So getting them to say anything concrete is like trying to catch a slippery eel. Some even go so far as stamping “Not to be relied upon” as a watermark in the document!An advisor will never go so far as to say that an business is a good or bad investment opportunity.So instead of putting themselves on the line, they’re main output is to raise “red flags” which are things that might be something to worry about. It’s then the investor’s job to work out of the red flags are real deal-breakers or not.Some red flags may get dealt with in the Post-Completion Plan or 100 day plan.
Redemption: The return of an investor’s principal in a debt security—such as a preferred stock or bond—upon maturity or cancellation by the entity that originally issued the security. Redemption can also refer to the sale of units in a mutual fund.
REDUCED RATES: -- In many countries the ordinary rates of tax charged under various tax laws may be reduced in particular situations. For example, under tax treaties, reduced withholding tax rates often apply to dividends, interest and royalties.
REFUND (OF TAX): -- Tax repaid to a taxpayer
REGISTERED SECURITY: -- A nominative (or registered) security is a security in respect of which the owner's name is recorded in a register by the issuing company and the registered owner is the person entitled to all relevant rights.
REGISTRATION DUTY: -- Fixed or variable duty levied on documents which relate to the transfer of ownership or the right to use movable or immovable property, the formation or any change of status of a company, etc.
REGULATED INVESTMENT COMPANY (RIC): -- Company, also known as a mutual fund, formed under US law to make diversified investment with funds provided by investors who receive dividends and capital gains realized by RIC.
REIMBURSEMENT: -- The payment of an employee or another party for incurred expenses or losses.REINSURANCE Transfer by a primary insurer to another insurer of all or part of any risk it has accepted in a contract of insurance. A number of countries have adopted special regimes to deal with cross-border reinsurance.
REIT (Real Estate Investment Trust): An investment company that owns a variety of real estate and sells shares to small investors.
Remainder interest –: A future interest in property held by a remainder person, usually following a life estate or term interest.
Remainder person: – A person entitled to hold a remainder interest.
REMUNERATION: -- Employment income and fringe benefits received by an employee for services rendered.
REPATRIATION: -- Individuals and legal entities investing their capital in a foreign country in order to derive income from such capital may wish to transfer this capital or income back to their home country, i.e. to repatriate it. Repatriation also takes place when expatriate employees working in a foreign country want to send income to their home country.
Replacement Planning: Is the process of identifying potential candidates to fulfil a role when coreemployees are known to be leaving the firm at some point in the future. Ithelps to lessen the impact of the departure on the firm particularly if thegap would pose a significant risk to the operation of the firm.
Representation: – a term more commonly used to refer collectively to grants of probate or administration.
Required Minimum Distribution (RMD): The amount that must be withdrawn annually from a qualified retirement plan, beginning April 1 of the year following the year in which the account holder reaches age 72.
RESALE PRICE MARGIN: -- Gross margin measured by reference to the price at which goods purchased from another party are resold to independent enterprises.
RESALE PRICE METHOD: -- Method used in transfer pricing between affiliated companies, under which an arm's length price is ascertained by deducting a normal profit margin from the resale price at which a buyer of inventory assets resells these assets to an unrelated party.
RESEARCH AND DEVELOPMENT (R&D): -- Any systematic or intensive study carried out in the manufacturing and industrial field, the results of which are to be used for the production or improvement of products and processes.
RESERVES: -- Funds made to fulfil future costs or expenditures. There are legal reserves which may be required by company law and may be necessary before dividends are distributed.
RESIDENCE: -- Residence is a basis for the imposition of taxation. Usually a resident taxpayer is taxed on a wider range of income or other taxable items than a non-resident. Residence in a state is a criteria for invoking a tax treaty of that state, and residence for treaty purposes involves considering the domestic law of residence for tax purposes, and then the requirements in Article 4 of the OECD Model, especially in the case of tiebreaker tests in cases of dual residence.
RESIDENCE PRINCIPLE OF TAXATION: -- Principle according to which residents of a country are subject to tax on their worldwide income and non-residents are only subject to tax on domestic-source income.
RESIDENT: -- A person who is liable for tax in a country or state because of domicile, residence, place of management, or other similar criterion.
RESIDENT ALIEN: -- A person is said to be a resident alien of a country if he resides in that country but is a citizen of another country.
RESIDUAL ANALYSIS: -- An analysis used in the profit split method which divides the combined profit from the controlled transactions under examination in two stages. In the first stage, each participant is allocated sufficient profit to provide it with a basic return appropriate for the type of transactions in which it is engaged. Ordinarily this basic return would be determined by reference to the market returns achieved for similar types of transactions by independent enterprises. Thus, the basic return would generally not account for the return that would be generated by any unique and valuable assets possessed by the participants. In the second stage, any residual profit (or loss) remaining after the first stage division would be allocated among the parties based on an analysis of the facts and circumstances that might indicate how this residual would have been divided between independent enterprises.
Residue (of a deceased estate) or Residuary Estate: – is all property that is left after debts have been paid and gifts specified in the will have been distributed. Beneficiaries who take from the residue maybe referred to as the residuary beneficiaries.If no will was left, then the residuary estate or residue is what is available for distribution after payment of the deceased’s debts.
RESTRICTED STOCK PLAN: -- A stock option plan under which the transferred stock option is subject to restrictions regarding transferability and to substantial risk of forfeiture. Restricted stock is includable in the gross income of the employee in the first taxable year in which the rights become transferable or no longer subject to forfeiture.
RETAIL SALES TAX: -- Single-stage tax on the sale of goods to ultimate consumers, whether by retailers or other traders.
RETAINED EARNINGS: -- The portion of a corporation's after-tax profits that is not distributed to the shareholders, but rather is reinvested in the business.
Retention: This term refers to an organisations ability to keep hold of employees. Themost talented desirable employees will always be in demand and it istherefore the organisations task to retain these crucial employees,financial incentives, ability to progress up the career ladder etc. Certainindustries, such as cleaning, have high turnover rates due to the nature ofthe work.
Retirement Planning: Preparing for retirement, both by investing to provide financial security and by planning for activities, career possibilities, and relationships that will provide a fulfilling life during retirement.
Retraining: Means training and development provided to address an individual's skills obsolescence in the current position and/or training and development to prepare an individual for a different occupation, in the same agency, in another Government agency, or in the private sector.
Retrieval Practice: is a deliberate technique in which learners build retention by recalling the skill or knowledge directly from memory, rather than reading a text or watching a demonstration.
Retrieval,: sometimes called recall, is how the brain accesses information that has been encoded and stored.
RETROACTIVE EFFECT: -- The effect of tax law provision towards the past, which is allowed only to the advantage of a taxpayer.
RETURN: -- Declaration of income, sales and other details made by or on behalf of the taxpayer. Forms are often provided by the tax authorities for this purpose.
Return (or Total Return): The amount of an investment’s yield, plus or minus its appreciation or depreciation. Its real return is the return adjusted for inflation.
RETURN OF CAPITAL: -- A distribution that is not paid out of the earnings and profits of a corporation. Rather, it is a return of the shareholder's investment in the stock of the company.
Return on Investment (ROI): is a ratio of the benefit or profit received from a given investment to the cost of the investment itself; for example, it can be used to compare the monetary benefits of training programs with program costs. ROI is usually displayed as a percentage or cost-benefit ratio.
Revenue: The amount of money a company brings in from its business activities during a given period, before expenses and taxes have been subtracted.
REVENUE NEUTRALITY: -- Constraints on tax reform that it should not change revenues available to government in any significant way.
REVENUE PROCEDURE (REV. PROC.): -- An official published statement by the IRS of US about procedural and administration aspects of the tax laws.
Reverse mortgage: – A contract/mortgage whereby a company makes payment to a homeowner based on the calculated value of a home. It allows the individual to reside there until death and takes title to the property upon issuing the loan as consideration and security for the loan. The loan is not required to be paid back in fullin this type of arrangement, but the house is removed from the person’s ownership and estate upon issuing the mortgage.
Reverse takeover: An acquisition of a company that is significantly larger than the bidder. The bidding company issues shares in itself to the targets shareholders as consideration. Through this exchange, the targets shareholders end up owning most of the bidding company, hence the reason why it is a takeover in reverse. Such a deal often sees the acquirer changing its name to that of the target.
Revocable Living Trust.: A trust that goes into effect while the trust creator is still living. It is usually meant to include all property which does not pass by title, beneficiary designation or otherwise, so as to avoid probate. A revocable living trust, in and of itself, does not avoid estate taxes or creditors.
Revocable Trust: A trust that can be altered or canceled by its grantor. During the life of the trust, any income earned is distributed to the grantor; upon the grantor’s death, the contents of the trust are transferred to its beneficiaries according to the terms of the trust.
Revocation: (of a will) – is to make a will ineffective, to cancel it.
Right of election –: The surviving spouse’s right to a share of the augmented estate rather than accepting the amount provided by will or intestate succession statues. The percentage is based on the length of marriage.
Right of first refusal: – The right to have the first opportunity to purchase a piece of property (usually real estate) when such becomes available or the right to meet any other offer on the subject property. The person holding a right of first refusal does not have the obligation to make the purchase
Right of survivorship: – this is a legal right which attaches to the joint ownership of property, whether it is real property (land) or personal property. It is a feature of joint tenancy. If two people own property as joint tenants and one dies, the surviving owner automatically owns the whole property. Information on the different ways to own property with others may be read here. Ownership and disposing of property by will can be read here.
RING FENCE: -- Theoretical enclosure established by tax legislation around certain profits, losses, transactions or groups of transactions in order to isolate them for tax purposes.
Risk: The chance an investment will be lost or will provide less-than-expected returns.
Risk Assessment: A determination of the level of vulnerability or likelihood of adverse effects resulting from an action or decision. Risk assessments identify and manage potential risks. In the area of human capital, risk assessments help identify problems that pose high risk to organizational integrity including financial or legal threats, systemic violations of employee protections or veterans' preference, and potential loss of integrity in the public eye. It is growing more common for such assessments to be conducted when undertaking human capital initiatives
RISK MANAGEMENT (LIFE, DISABILITY & LONG TERM CARE INSURANCE EVALUATION): Insurance is the all-too-often missing piece of the financial plan, and one that can lead to a quick financial ruin. We will help you determine the right amount and best type of coverage, properly preparing you for life’s unfortunate events. Additionally, we can help you get the best value as you manage these risks.
risk of loss: A value assigned to a worker to rate the likelihood of the worker leaving the enterprise.
Risk Tolerance: A measurement of an investor’s willingness or ability to handle investment losses.
Risk-Averse: Refers to the assumption that rational investors will choose the security with the least risk if they can maintain the same return. As the level of risk goes up, so must the expected return on the investment.
Rollover: A method by which an individual can transfer the assets from one retirement program to another without the recognition of income for tax purposes. The requirements for a rollover depend on the type of program from which the distribution is made and the type of program receiving the distribution.
ROLLOVER RELIEF: -- Relief by means of which liability to capital gains tax is deferred. The essential feature of roll-over relief is that a gain which would otherwise have arisen on the occurrence of a taxable event for capital gains tax purposes is deferred, or rolled over, until there is a subsequent disposal of the asset concerned.
Rotational Assignment: Developmental assignment away from an employee's current position. During these assignments, individuals learn to adapt and successfully lead in a new position.
Roth IRA: A qualified retirement plan in which earnings grow tax deferred and distributions are tax free. Contributions to a Roth IRA are generally not deductible for tax purposes, and there are income and contribution limits. Roth IRA contributions cannot be made by taxpayers with high incomes. To qualify for the tax-free and penalty-free withdrawal of earnings, Roth IRA distributions must meet a five-year holding requirement and occur after age 59½. Tax-free and penalty-free withdrawal also can be taken under certain other circumstances, such as after the owner’s death. The original Roth IRA owner is not required to take minimum annual withdrawals.
Roth IRA Conversion: The process of transferring assets from a traditional, SEP, or SIMPLE IRA to a Roth IRA. Roth IRA conversions are subject to specific requirements and may be taxable.
ROUND TRIP TRANSACTION: -- Potential transfer pricing abuse where intangible property is developed by a parent company which licenses it to a related party manufacturer located in a low-tax jurisdiction. The manufactured goods are resold to the parent for distribution to ultimate consumers.
ROYALTIES: -- Payments of any kind received as consideration for the use of, or the right to use intellectual property, such as a copyright, patent, trade mark, design or model, plan, secret formula or process.
RULING: -- Decisions or opinions of the tax authorities in respect of actual fact situations which come before it as part of an assessment procedure or in response to taxpayer questions.
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S CORPORATION: -- See: Small business corporation
Sabbatical: An absence from duty, without charge to pay or leave, that an agency may grant to a Senior Executive Service career appointee to engage in study or uncompensated work experience.
SAFE HARBOUR: -- Where tax authorities give general guidelines on the interpretation of tax laws, these may state that transactions falling within a certain range will be accepted by the tax authorities without further questions.
SALE AND LEASEBACK: -- In a sale and leaseback transaction, the owner of property will sell it to a buyer who then leases it back to the original owner. This method is sometimes used to release the value of capital assets for use in a business.
Sales Enablement: supports a sales team in achieving its goals by providing it with the tools and resources it needs to win. It spans sales strategy, sales training, coaching, content creation, process improvement, sales career development, and sales compensation, among other areas.
SALES TAX: -- Tax imposed as a percentage of the price of goods (and sometimes services). The tax is generally paid by the buyer but the seller is responsible for collecting and remitting the tax to the tax authorities.
SALVAGE VALUE: -- Value of tangible depreciable property when it is retired from service.
sandbox: A testing environment that isolates untested code changes from the mainline environment so that these changes don't affect the mainline metadata or other sandboxes.
Savings Incentive Match Plan for Employees (SIMPLE): A qualified retirement plan that allows employees and employers to contribute to traditional IRAs set up for employees. SIMPLE plans are available to small businesses—those with 100 or fewer employees—that do not currently offer another retirement plan.
Scale: Levels of values used to measure proficiencies or attributes
Scenario Planning: Scenario planning exercises involve identifying future trends andexploring the implications by projecting them forward. These projectionsare not forecasts, but possible futures that allow employers to identifyspecific skills that their company will require in the future.
SCHEDULAR TAX SYSTEM: -- Tax system in which income from different sources is taxed separately (i.e. under a different "schedule"); thus, separate tax assessments are made on industrial and commercial profits, wages and salaries, income from securities and shares, income from land, etc.
Scope Creep: is when work or deliverables are added to a project that were neither part of the project requirements nor added through a formal change process.
SCORM (Shareable Content Object Reference Model): defines a way of constructing learning management systems and courses so they can be shared with other compliant systems.
SECONDARY ADJUSTMENT: -- An adjustment that arises from imposing tax on a secondary transaction.
Secondary Buyout: When you’re already PE backed and sell to another PE firm.In the old days these deals were seen as bit off. The idea was that a company under PE ownership should maximise it’s lot in life and then do a trade sale. If you sold to another PE firm then you had “left value on the table” for the other PE firm.This is no longer the case with many companies going through multiple rounds of PE ownership. Some PE firms have even been known to buy back assets that they owned previously, wanting a second spin on the wheel .
Secondary buyout (SBO): This refers to an investment in an existing private equity backed company, which can enable the incumbent investor to realise the value of their investment. Read more.
SECONDARY TRANSACTION: -- A constructive transaction that some countries will assert under their domestic legislation after having proposed a primary adjustment in order to make the actual allocation of profits consistent with the primary adjustment. Secondary transactions may take the form of constructive dividends, constructive equity contributions, or constructive loans.
Secondment Opportunity: This provides employees with the opportunity to tryout different roleswithin an organisation. It is a good strategy for the most forward thinkingorganisations as it allows for employees to develop and tests theirsuitability/skills in a different role.
SECOND-TIER SUBSIDIARY: -- A taxable entity controlled by another taxable entity that is in turn controlled by a third entity.
SECRET COMPARABLE: -- A term used in the transfer pricing context. It denotes a comparable whose data is not disclosed to the public or the taxpayer but known only to the tax authority which is making the transfer pricing adjustment.
SECTION 482: -- The part of the US income tax code that gives the IRS the power to adjust distribute, apportion, or allocate gross income, deductions, credits, or allowances in order to prevent evasion of taxes or to clearly reflect income (often between controlled taxpayers); in short, US transfer pricing rule provision.
SECTION 482 WHITE PAPER: -- Study of intercompany pricing transactions made by the Office of International Tax Counsel at the US Treasury Department which presented a new methodology to govern transactions involving the sale, licensing or transfer of intangible property, published in 1988.
SECURITIES: -- Documents providing evidence of a share in the capital of a company (e.g. share certificate), or the indebtedness of some person to the holder (e.g. government or corporate bonds) or similar legal rights.
Securities and Exchange Commission (SEC): A federal agency with a mandate to protect investors; to maintain fair, orderly, and efficient markets; and to facilitate capital formation. The SEC acts as one of the primary regulatory agencies for the investment industry.
Security: Evidence of an investment, either in direct ownership (as with stocks), creditorship (as with bonds), or indirect ownership (as with options).
SELF-ASSESSMENT: -- System under which the taxpayer is required to declare the basis of his assessment (e.g. taxable income), to submit a calculation of the tax due and, usually, to accompany his calculation with payment of the amount he regards as due. The role of tax authorities is to check (perhaps in random cases) that the taxpayer has correctly disclosed his income.
Self-Directed IRA: An individual retirement arrangement in which the account holder can direct the investment of funds, subject to certain conditions and limits.
Self-directed learning (SDL): is when the learner determines the pace and timing of content delivery. It occurs through a variety of media (print products or electronically).
SELF-EMPLOYED: -- Referring to persons who work for themselves and are not employed by another. The owner-operator of a sole proprietorship or a partner is considered self-employed.
Self-Employed Retirement Plans: In the past, the terms “Keogh plan” and “H.R. 10 plan” were used to distinguish a retirement plan established by a self-employed individual from a plan established by a corporation or other entity. However, self-employed retirement plans are now generally referred to by the name of the particular type of plan used, such as SEP IRA, SIMPLE 401(k), or self-employed 401(k). The contribution amount is indexed annually for inflation.
SENATE FINANCE COMMITTEE: -- A committee of the US Senate that hears proposed new tax laws.
Senior Debt: This is any money that is borrowed that ranks (in terms of who gets paid back first) senior to the investor. So this is normally a fancy word for money you borrow from the bank. (See Leverage and LBO).You can borrow money for normal business investments but in the context of a PE dea, the first and primary use of bank debt is to to part finance the company’s acquisition by the PE fund in the first place.Bank debt normally ranks ahead of any other debt or loans so it is paid back first when you sell or refinance. Bank debt is low risk, low return.
SEPARATE ASSESSMENT: -- See: Separate taxation
SEPARATE TAXATION: -- Separate taxation is a method of taxing a married couple on the basis of their joint income. It is mandatory in some countries and optional in others. Upon exercising an option for separate taxation, a husband and wife are treated as separate individuals for the purpose of computing income tax.
SERVICE COMPANY: -- Company within a multinational group of companies which generally provides support services, such as administration, sales information, post-sales service or market research, for the operating divisions of the group.
SERVICE FEE: -- A fee for the rendering of services is generally regarded as income from business activities or, in the case of a liberal profession, as income from independent personal services.
SES Candidate Development Program: Competitive training programs designed to provide employees with strong executive potential the training and development needed to enhance their executive competencies and increase their understanding of the wide range of Government programs and issues beyond their individual agency and profession. Individual agencies administer their own OPM-approved SESCDPs.
SEVERANCE PAYMENTS: -- Payment made as a result of the termination of any office or employment of a person.
Shadowing: Shadowing involves following an industry professional to gain an insightinto the role by observing their everyday tasks and duties. It is helpful forhelping people to explore career options.
Shadowing Assignment: Observing a Federal leader in daily activities for a defined period of time. By watching leaders in action, the program participant gains exposure to leadership duties, responsibilities and approaches, and observes how concepts learned are applied in real-world situations.
SHAM TRANSACTION: -- A transaction without substance, which will be ignored for tax purposes.
Share: A unit of ownership in a corporation or financial asset.
SHARE (STOCK) OPTIONS FOR EMPLOYEES: -- Some companies grant directors and employees an option to acquire at a future date shares or stock in the company at a predetermined price. It gives an employee the opportunity to benefit from the future success of the company when the market value of the shares increases over the predetermined option acquisition price.
SHAREHOLDER ACTIVITY: -- An activity which is performed by a member of an MNE group (usually the parent company or a regional holding company) solely because of its ownership interest in one or more other group members, i.e. in its capacity as shareholder.
SHAREHOLDERS' EQUITY: -- The total assets minus total liabilities of a corporation, also called stockholders' equity or net worth.
SHELL COMPANY: -- A company set up by fraudulent operators as a front to conceal tax evasion schemes.
SHIFTING AN INCIDENCE OF TAXATION: -- Determination of the economic entity that actually ends up paying a particular tax. In the case of indirect taxation tax is normally intended to fall upon consumption and be borne by consumers, so that entrepreneur who pays the tax on his supplies of goods and services in general passes on the tax, or "shifts" it "forward" to the consumer by adjusting his prices appropriately. Such taxes are said to be shifted "backward" in the case that entrepreneurs are forced to absorb some of new or increased tax.
SHIFTING OF PROFITS: -- See: Profit shifting
Short Selling: The practice of selling securities which are borrowed from a third party (usually an investment bank) with the intention of buying the same securities back at a later date to return to the lender.
Short-term: This refers to the immediate impacts and goals. For example, if someonehas completed a course, thy immediately have a higher level ofknowledge and may have higher morale.
SHORT-TERM CAPITAL GAINS: -- Capital gain derived from the disposal of assets which have been held for a comparatively short period of time.
Simplified Employee Pension Plan (SEP): A type of plan under which the employer contributes to an employee's IRA. Contributions may be made up to a certain limit and are immediately vested.
Simulation: is a broad genre of experiences, including games for entertainment and immersive learning simulations for formal learning programs. Simulations use simulation elements to model and present situations; portraying actions and demonstrating how the actions affect relevant systems, and how those systems produce feedback and results.Six-Sigma Methodolog
SIMULTANEOUS TAX EXAMINATION: -- A simultaneous tax examination, as defined in Part A of the OECD Model Agreement for the Undertaking of Simultaneous Tax Examinations, means an "arrangement between two or more parties to examine simultaneously and independently, each on its own territory, the tax affairs of (a) taxpayer(s) in which they have a common or related interest with a view to exchanging any relevant information which they so obtain".
SINGLE ENTITY APPROACH: -- Method of taxing a legal entity that conducts its business through a permanent establishment rather than through a subsidiary company. Under the single entity approach, a head office and a permanent establishment are treated as one taxpayer for tax purposes, even though they may be considered separate entities for purposes of accounting or commercial law.
Single Ladder Talent Management Strategy: This approach to talent management involves having one talent pipelinefocussing on the development of potential leaders or recognisedprofessionals. It typically involves qualification attainment, professionalbody membership and requires specific years of experience.
SINGLE TAXPAYER: -- A person who is not married on the last day of the tax year.
Single-Life Annuity: An insurance-based contract that provides future payments at regular intervals in exchange for current premiums. Generally used as a supplement to retirement income and pays over the life of one individual, usually the retiree, with no rights of payment to any survivor.
SISTER CORPORATION: -- See: Brother-sister corporation
SITUS RULE: -- Provision of tax law setting out the factors which determine where a particular asset is situated or deemed to be situated for tax purposes.
SIX MONTHS' RULE: -- See: One hundred and eighty-three (183) days' rule
Skills: Proficiency, facility, or dexterity that is acquired or developed throughtraining or experience. Your skills will constantly be developing andchanging throughout your life and along the way you will develop many‘hidden skills.’
Skills Gap: Defined as an instance in which an individual lacks a skill in a particulararea, preventing them from performing their job effectively (UKCES,2012). A skills gap will never have a positive impact on an organisation asit will reduce productivity and proficiency.
Skills Gap Analysis: The process that an organisation go through in order to identify skills gapswithin the workforce. Completing a skills gap analysis can significantlyboost workforce efficiency and productivity once the gaps have beenaddressed.
SMALL BUSINESS CORPORATION: -- Under US tax law, this term refers to a domestic corporation which does not have more than 35 individual shareholders, all of whom are US citizens or residents and which does not have more than one class of stock. Also known as an "S corporation", this form permits income at the corporate level to be taxed only once at the shareholder level.
SMALL BUSINESS RELIEF: -- Term used to denote tax concessions which are available only to or principally to small businesses.
SMALL TRADERS, SPECIAL TAX REGIME FOR: -- In many countries small traders are subject to a special tax regime, particularly in respect of VAT, in which exemption, lower tax burden or lower administrative burden are granted.
SMART: A mnemonic to guide people when they set objectives. The letterscommonly stand for; Specific, Measurable, Attainable, Relevant andTimely. Recent additions to the acronym include Evaluate and Revaluate.
SOAK-UP TAX: -- Tax or levy which is conditioned on the availability of a foreign tax credit in another country.
Social Bookmarks: A system allowing users to collect and store bookmarks online, tag with key words and share those bookmarks and tags with others. This type of tool allows course instructors develop course reading lists. Course participants supplement course material by subscribing to a particular tag or keyword that relates to the course.
Social Learning: occurs naturally when two or more people interact. Organizations are now beginning to use social media tools to enhance social learning and knowledge-sharing, resulting in more informed, effective workplace collaborations.
Social Network: An online group of people who develop friendships, find professional connections, share interests, and gather knowledge and information. These communities are formed online through social sites. Learning and development programs can utilize these networks to link course participants before and after a training event to share knowledge and ideas regarding the course. Instructors and participants provide links to articles, webinars, and on-the-job examples before, during, and after a training event.
SOCIAL SECURITY CONTRIBUTIONS: -- Charges levied on employees, employers or self-employed or on all persons subject to individual income tax to cover the cost of providing future social security payments.
SOLE PROPRIETORSHIP: -- Ownership of all of the assets of an unincorporated business by a single individual. The individual owner is personally liable for all debts of the business.
Solemn Form –: sometimes a grant of probate can’t be made because there is some issue or dispute about the will. Once resolved by the Probate Court the Court may then issue what is called a grant of probate in solemn form. These words indicate that court proceedings had taken place.
Sound mind: – The testator possesses a sound mind for the purposes of making a will if he or she:1. Understands the nature of the act of making a will or codicil to it,2. Knows the extent and character of the property subject to the will,3. Knows and understands the proposed disposition of that property, and4. Knows the natural objects of his or her bounty
SOURCE OF INCOME: -- The place (or country) where a particular item of income is deemed to originate or where it is deemed to be generated. National rules vary, depending on which concept of source is used.
SOURCE PRINCIPLE OF TAXATION: -- Principle for the taxation of international income flows according to which a country consider as taxable income those income arising within its jurisdiction regardless of the residence of the taxpayer, i.e. residents and non-residents are taxed on income derived from the country.
source rating: The rating level associated with a content item of the source profile in the best-fit analysis.
SOURCE RULE: -- Provision in the national law of a country or in a tax treaty which defined the concept of source for a particular type of income.
Special warranty deed -: The grantor warrants title only against defects occurring during the grantor’s ownership but not before that time.
Speculation: Putting money into a high-risk investment in the hope of building wealth quickly.
SPECULATIVE GAINS: -- Gains from the disposal of capital assets which were originally acquired with a view to selling them for more than the cost of acquisition.
SPIN-OFF: -- A type of corporate reorganization by which the shares of a new corporation (or the subsidiary company) are distributed to the original shareholders (or the parent's shareholders) without these shareholders surrendering any of their stock in the original (or parent) corporation.
Split-Dollar Life Insurance: An arrangement under which a life insurance policy’s premium, cash values, and death benefit are split between two parties—usually a corporation and a key employee or executive. Under such an arrangement an employer may own the policy and pay the premiums and give a key employee or executive the right to name the recipient of the death benefit. Several factors will affect the cost and availability of life insurance, including age, health, and the type and amount of insurance purchased. Life insurance policies have expenses, including mortality and other charges. If a policy is surrendered prematurely, the policyholder also may pay surrender charges and have income tax implications. You should consider determining whether you are insurable before implementing a strategy involving life insurance. Any guarantees associated with a policy are dependent on the ability of the issuing insurance company to continue making claim payments.
Split-Dollar Plan: An arrangement under which two parties (usually a corporation and employee) share the cost of a life insurance policy and split the proceeds.
SPLIT-OFF: -- A type of corporate reorganization by which the shares of a new corporation (or the subsidiary company) are distributed to the original shareholders (or the parent's shareholders) with these shareholders surrendering part of their stock in the original (or parent) corporation.
SPLIT-UP: -- Under a split-up the shareholders of a parent company surrender all their stock in liquidation of that company and in return receive new shares in corporation which the parent controlled or created immediately before the distribution.
Spousal IRA: An individual retirement arrangement under which an IRA is established for a non-working spouse and is funded with contributions from the working spouse. Spousal and non-spousal IRAs are subject to combined annual contribution limits and must meet certain requirements. Contributions to a traditional IRA may be fully or partially deductible, depending on your individual circumstance. Under the SECURE Act, in most circumstances, once you reach age 72, you must begin taking required minimum distributions from a spousal IRA. Withdrawals are taxed as ordinary income, and if taken before age 59½, may be subject to a 10-percent federal income tax penalty. You may continue to contribute to a Traditional IRA past age 70½ under the SECURE Act as long as you meet the earned-income requirement.
Spousal Lifetime Access Trust (SLAT): . A Spousal lifetime access trust (SLAT) is an irrevocable trust benefiting a grantor’s spouse and/or children. Through a SLAT, the grantor reduces the spouse's exposure to estate taxes by taking advantage of the donor’s gift tax exemption.
Spouse: – A person’s legal wife or husband. The definitions of relationships such as “common law spouse” and “domestic partner” vary by state.
SPREAD: -- Can be used in many contexts to denote the margins on financial transactions. For example, the spread of an option is the difference between the fair market value of stock at the exercise date and the option price.
Stakeholder: An individual, or group of individuals, who have a significant or vested interest in the outcome of an undertaking, key decision, or venture. In human capital ventures, different individuals and groups often have a shared responsibility for the successful outcome of a program or initiative because they share in the benefits of the program. Congress, customers, managers, and employees are examples of potential stakeholders.
STAMP DUTIES: -- Duty levied upon the issue of official documents such as passports, deeds, contracts for the transfer of ownership, etc. Usually, stamp duties are "levied" by way of a stamp being fixed to the document in question. Stamp tax
Standard & Poor’s 500 Index (S&P 500): An average calculated by summing the prices of 500 leading companies in leading industries of the U.S. economy and dividing the sum by a divisor which is regularly adjusted to account for stock splits, spinoffs, or similar structural changes. Index performance is not indicative of the past performance of a particular investment. Past performance does not guarantee future results. Individuals cannot invest directly in an index.
Status Handling: The use of Nominated and Approved statuses to specify if an assignment to a Succession Plan, Successor Pool or Talent Group has been confirmed or not
STATUTE OF LIMITATIONS: -- A statute limiting the period within which a specific legal action may be taken, such as the collection of tax, appeal from a decision of the tax authorities or lower court, etc.
Stock: An equity investment in a company. Stockholders own a share of the company and are entitled to any dividends and financial participation in company growth. They also have the right to vote on the company’s board of directors. Keep in mind that the return and principal value of stock prices will fluctuate as market conditions change. And shares, when sold, may be worth more or less than their original cost.
Stock Certificate: A legal document that certifies ownership of a specific number of shares of stock in a corporation. In many transactions, the stockholder is registered electronically, and no certificate is issued.
STOCK DIVIDENDS: -- Dividend distribution by a company to its shareholders in the form of additional shares in the company.
STOCK EXCHANGE TURNOVER TAX: -- Tax levied on the sale of securities on the stock exchange market.
STOCK OPTION: -- (1). The right to purchase or sell a stock at a specified price within a stated period (2). Employee stock option
Stock Purchase Plan: A program under which an employer offers its employees the opportunity to buy stock at a favorable price, often through payroll deduction.
Stock Split: A decision by a company to increase the number of shares of stock it has outstanding by issuing more shares to its current shareholders. For example, in a 2-for-1 split each shareholder would receive as many new shares as he or she owns—effectively doubling the number of shares he or she owns. The price per share adjusts to account for the split. In the example of a 2-for-1 split, each of the new shares would have a par value of half the prior price.
Strategic Alliance: An agreement between two or more companies involving the joint manufacture, distribution, and maintenance of products and services, which included the transfer of stakes between the involved companies.
Strategic leader development: is an ongoing practice based on defining an agency’s vision, identifying the leadership and managerial skills necessary to carry out that vision, and recruiting and maintaining talented individuals who have or who can develop those skills. The key word in that definition is “ongoing.” So rather than planning in anticipation of a specific leadership departure, there is an organizational commitment to ensuring the right staff and the right volunteers are in place (with the essential skill-sets) to successfully advance towards the organizational vision and be ready for any opportunity or eventuality.
Strategic planning: is the process an organization uses to identify its direction for the future. No single process exists, but it usually includes envisioning the future, defining goals and objectives, aligning structure and resources, and implementing the plan.
STRIPPED BOND: -- Bond or debenture from which the interest coupons have been removed and sold separately.
STVN SuccessionPlanning: The graphical user interface offered by SAP to support succession planning processes
STVN TalentHub: A new name for STVN SuccessionPlanning from STVN4.0
Subject Matter Expert: A person with bona fide expert knowledge about what it takes to do a particular job. First-level supervisors are normally good SMEs. Superior incumbents in the same or very similar positions and other individuals can also be used as SMEs if they have current and thorough knowledge of the job's requirements.
Subject Matter Expert (SME): is an individual who is recognized as having proficient knowledge and skills in a particular topic or subject area.
SUBPART F: -- Term which refers to those sections of the US tax code which provide for the taxation of US shareholders of controlled foreign corporations (CFC) in order to prevent the tax-free accumulation of earnings outside the US.
SUBPOENA: -- Latin for "under penalty"; a writ issued under the authority of a court to compel the appearance of a witness or of documents for a tax judicial proceeding.
SUBSIDIARY COMPANY: -- Company effectively controlled by another company (i.e. the parent company). A variety of criteria, including share ownership ratio, may be employed to determine whether one company is a subsidiary of another company for tax purposes.
SUBSTANCE OVER FORM DOCTRINE: -- Doctrine which allows the tax authorities to ignore the legal form of an arrangement and to look to its actual substance in order to prevent artificial structures form being used for tax avoidance purposes.
SUBSTANTIAL PRESENCE TEST: -- Test used to determine residence status based on the number of days, months, etc. of physical presence within a country.
Succession: The process of transitioning ownership from one generation to the next. The elements of a comprehensive plan for succession include: financial security, management continuity, ownership transition, leadership development and estate planning.
succession plan: A plan that identifies candidates for a role or position or to succeed a named incumbent.
succession plan owner: A person who can manage succession plans. Valid actions depend on the owner's administrator type, which can be Administrator, Candidate Manager, or Viewer.
Succession Planning: Proactive and systematic process where organizations identify those positions considered to be at the core of the organization-- too critical to be left vacant or filled by any but the best qualified persons—and then create a strategic plan to fill them with experienced and capable employees.
Successor: Someone who is adjudged to be capable of taking a position in the futureSuccessor PoolA collection of employees who have potential to fill one or more jobs or positions within a specific job family
Summons: – is a prescribed court form used when someone wants to initiate court proceedings so as to bring an issue before the court for resolution. The summons must be brought to the attention of all other people who are affected, that is, they must each be served with a copy of it once it has been filed in court. In succession law for example, a summons is how an executor can bring a particular issue needing judicial determination before the court.
SUPER ROYALTY PROVISION: -- The US Income Tax Reform Act of 1986 provides that royalties for the transfer (by sale, license or otherwise) of intangible property to related foreign companies, which have been determined at the time of the transfer on an arm's length basis, may be adjusted in future years by the IRS if they are not commensurate with the income attributable to that intangible. This is called the super royalty provision.
SUPPLEMENTAL ASSESSMENT: -- Determination of tax liabilities at the discretion of the tax authorities if an original assessment is incomplete or incorrect in any material respect.
SURCHARGE: -- Additional amount which is calculated on and added to the normal charge or levy. In other words, the base on which a surcharge is assessed is the normal or basic amount due. Surtax
Survivorship: – see
SWAP: -- Derivative financial instrument in which two parties agree to exchange payments calculated by reference to a notional principal amount. In the classic interest rate swap agreement two parties contract to exchange interest payments based on the same amount of indebtedness of the same maturity and with the same payment dates; one party provides fixed interest rate payments in return for variable rate payments from the other party and vice versa.
Sweat equity: – The increased financial value of a farm or other business (over and above money or tangible assets contributed) that was created by uncompensated mental and/or physical efforts.
SWOT Analysis: A planning method that is used to evaluate individuals Strengths,Weaknesses, and what they believe to be their Opportunities and Threats.It is one of the important first steps that will lead to a successfuldevelopment plan.
Synchronous Training: occurs when the facilitator and the learner participate in the training at the same time. It is most often used when discussing virtual training, which can be synchronous or asynchronous.
SYNDICATE: -- A group of individuals who have formed a joint venture to undertake a project that the participants would be unable or unwilling to pursue alone.
Succession Planning: T
Take private: As the term suggests, the acquisition of a publicly quoted company, usually by a financial institutions such as private equity firm or venture capitalist (as opposed to a trade purchaser), and its subsequent delisting
Talent: Talent is described as the personal qualities “of those individuals who canmake a difference to organisational performance either through theirimmediate contribution or, in the longer-term, by demonstrating thehighest levels of potential” (CIPD, 2012)
Talent Acquisition: is a process for filling vacancies in a timely manner.
Talent Assessment: Application used to assess the talent-related characteristics of employees by their manager
Talent Development: Talent Development cultivates a continuous learning and development environment to ensure that an agencies workforce can adapt to globalization, internal restructuring, and adaptations that affect how work is performed. Talent Development activities are aligned to an agencies Talent Management process to ensure that succession planning and retention is the organizational philosophy versus possessing the mindset of replacing the required skills sets. The integration of Talent Development with Talent Management includes the analysis of workforce data to determine how an agency will meet its needs through the development/re-development of talent who possesses the required skills.
Talent Development (TD): refers to the efforts that foster learning and employee development to drive organizational performance, productivity, and results.
Talent Diagnostics Tool: Talent diagnostic tools are assessments designed to identify talentedindividuals and develop them to support business growth objectives. Theyinclude the following types of activity: 360 degree feedback, knowledgeassessments, psychometric testing, performance appraisals andprofessional development plans.
Talent Group: A group of talented employees
Talent Management: Refers to the process of retaining and developing new or current workersthat your organisation has deemed to be particularly talented. Developingtalented employees helps an organisation meet its objectives as long asthis development is aligned with their business objectives.
Talent Management Strategy: A talent management strategy is an organisations approach to developingand nurturing their talent. Having a successful strategy in place has beenproven to boost organisations profitability.
Talent Management System: A system that addresses competency gaps, particularly in mission-critical occupations, by implementing and maintaining programs to attract, acquire, develop, promote, and retain quality talent.
Talent Pool: A talent pool is a selection of employees that have been selected fordevelopment in a particular area. For example, selecting those that youbelieve can become the directors and leaders of the future.
talent pool member: A worker who is added to a talent pool.
talent pool owner: A human resource specialist who can manage a talent pool.
Talent Profile for Employees: A self-service profile of talent-related information maintained by employees, such as education, work experience, career aspirations and mobility preferences
Talent Profile for Managers and Talent Management Specialists: An extended display version of the Talent Profile for Employees that is available to managers and Talent Management Specialists, containing additional talent-related information
talent review: A series of meetings where organization managers evaluate trends, assess strengths, and address areas of risk for the organization.
talent review facilitator: Human resource specialist who manages talent review meetings. A talent review meeting can have multiple facilitators.
Talent Review Meeting: Application used to support the review of employees both during and/or after the appraisal and talent assessment processes
talent review participant: Person who's invited to attend a talent review meeting.
talent review reviewer: Manager who updates profile content for direct and indirect reports before the talent review meeting.
talent score: An assessment of a worker's overall value to the enterprise using a company-defined rating model.
Talent Strategy and Management: are the practices used to build an organization's culture, engagement, capability, and capacity through the implementation and integration of talent acquisition, employee development, retention, and deployment processes, ensuring these processes are aligned to organizational goals.
Tangible property: – Property that is capable of being perceived by the senses. Generally, tangible property is real estate, personal property or moveable property that has value of its own and is not merely a representation of real value. Land, machinery, buildings, business equipment, inventories, homes and furnishings are examples of tangible property.
target rating: The rating level associated with a content item of the target profile in the best-fit analysis.
Targeted Training: Targeted training has significant benefits over generic training. It isfocused on peoples identified training needs. It benefits the individuals byreceiving focused training as well as the organisation as targeted trainingis a better allocation of resources, more likely to boost productivity andwill cost less over time.
TARIFF: -- In general the term "tariff" refers to a list (schedule) or system of levies (taxes, duties, charges) imposed by countries on foreign trade transactions (especially importations).
TAX: -- The OECD working definition of a tax is a compulsory unrequited payment to the government.
TAX AGENT: -- Term which refers to a tax adviser who assists the taxpayer in fulfilling his obligations under the legislation.
TAX AUTHORITIES: -- The body responsible for administering the tax laws of a particular country or regional or local authority.
TAX AVOIDANCE: -- See: Avoidance
TAX BASE: -- Taxable base
TAX BASIS: -- Term used in the US to refer to an amount that represents the taxpayer's investment in an asset.
Tax basis (federal): – The owner’s cost of an asset for income and estate tax purposes as determined under theInternal Revenue code and IRS regulations.
TAX BILL: -- Draft law on a tax matter which, after approval by the government of a country, is submitted to the Parliament for debate.
TAX BURDEN: -- For public finance purposes the tax burden, or tax ratio, in a country is computed by taking the total tax payments for a particular fiscal year as a fraction or percentage of the Gross National Product (GNP) or national income for that year.
TAX CLEARANCE CERTIFICATE: -- Document issued to a taxpayer by the tax authorities certifying that the taxpayer has either paid all taxes due or that he is not liable to any taxes. In certain countries a tax clearance certificate must be produced before a person can leave the country.TAX COMPLIANCE -- Degree to which a taxpayer complies (or fails to comply) with the tax rules of his country, for example by declaring income, filing a return, and paying the tax due in a timely manner.
Tax Credit: Tax credits, the most appealing type of tax deductions, are subtracted directly, dollar for dollar, from your income tax bill.
TAX DECLARATION: -- See: Return
Tax Deduction: An amount that can be subtracted from a taxpayer’s income before taxes are calculated. Taxpayers may use the standard deduction or may itemize deductions if allowable itemized deductions exceed the standard deduction.
Tax Deferred: A condition of certain plans and accounts under which the funds in the plan or account along with any accrued interest, dividends, or other capital gains, are not subject to taxes until the funds are withdrawn.
TAX DEPOSIT CERTIFICATE: -- Certificate available for purchase in US to taxpayers liable to income or corporate tax, etc. Liability to taxes may be paid by cashing in the deposit certificate. Interest is credited on the deposit by the Inland Revenue.
TAX EQUALITY: -- See: Horizontal equity; Vertical equity
TAX EVASION: -- See: Evasion
TAX EXILE: -- Generally speaking, a natural or legal person who severs all ties which make him fiscally resident in a particular country and moves to another jurisdiction for tax reasons.
TAX EXPENDITURE: -- This term denotes special preferences provided in income tax laws which depart from the normal tax structure and which are designed to favour a particular industry, activity or class of taxpayer.
TAX FORECLOSURE: -- The process of enforcing a lien against property for non-payment of delinquent property taxes.
TAX FORM: -- It is usual to design special forms for taxpayers to declare their taxable income, sales, etc. for tax purposes. Forms are designed to facilitate the task of the tax authorities in assessing and collecting tax, and will usually draw the taxpayer's attention to any relief he may claim, etc. as well as to his statutory duty to make accurate declarations and the penalties that may be imposed if his declaration is incomplete or false.
TAX HAVEN: -- Tax haven in the "classical" sense refers to a country which imposes a low or no tax, and is used by corporations to avoid tax which otherwise would be payable in a high-tax country. According to OECD report, tax havens have the following key characteristics; No or only nominal taxes; Lack of effective exchange of information; Lack of transparency in the operation of the legislative, legal or administrative provisions.
TAX HOLIDAY: -- Fiscal policy measure often found in developing countries. A tax holiday offers a period of exemption from income tax for new industries in order to develop or diversify domestic industries.
TAX HOME: -- A taxpayer's regular place of business or post of duty, regardless of where the taxpayer a family home.
TAX INFORMATION EXCHANGE AGREEMENT (TIES): -- Agreement which allows governments to share tax and other information with a view to combating tax evasion, drug trafficking, etc.
TAX LAW, SOURCES OF: -- The main domestic sources of tax law are primary legislation, such as acts or laws, and secondary legislation such as regulation, decisions, circulars, orders, etc. The main international sources of tax law are bilateral or multilateral treaties, and one important source for the interpretation of treaties is the OECD model tax treaty and the accompanying commentary. Another model is UN model.
TAX ON TAX: -- The charging of tax on tax-inclusive prices.
TAX PLANNING: -- Arrangement of a person's business and /or private affairs in order to minimize tax liability.
TAX RELIEF: -- Generic term to describe all methods used to reduce tax liability without regard to the particular way it is accomplished.
TAX RETURN: -- See: Return
TAX SECRECY: -- Obligation usually imposed on tax officials not to reveal particulars about the identity and personal circumstances of taxpayers, or about any of the various aspects governing their tax liability, except in certain strictly limited circumstances.
TAX SHELTER: -- (1) An opportunity to use, quite legitimately, a relief or exemption from tax to pay less tax than one might otherwise have to pay in respect of similar activities, or the deferment of tax. (2) The polite term usually given to a contrived scheme to avoid or reduce a liability to taxation.
TAX SPARING CREDIT: -- Term used to denote a special form of double taxation relief in tax treaties with developing countries. Where a country grants tax incentives to encourage foreign investment and that company is a resident of another country with which a tax treaty has been concluded, the other country may give a credit against its own tax for the tax which the company would have paid if the tax had not been "spared (i.e. given up)" under the provisions of the tax incentives.
TAX THRESHOLD: -- Level (of income, capital, sales, etc.) at which tax commences to be levied.
TAX TREATY: -- An agreement between two (or more) countries for the avoidance of double taxation. A tax treaty may be titled a Convention, Treaty or Agreement.
TAX UNIT: -- Term used in the context of personal income tax, where taxation may be imposed by reference to separate individuals or to a group of individuals treated as one unit.
TAXABLE BASE: -- The thing or amount on which the tax rate is applied, e.g. corporate income, personal income, real property.
TAXABLE EVENT: -- Term used to define an occurrence which affects the liability of a person to tax.
Taxable Income: The amount of income used to compute tax liability. It is determined by subtracting adjustments, itemized deductions or the standard deduction, and personal exemptions from gross income.
TAXABLE PERIOD: -- Taxes are levied by reference to a period of time called the "taxable period". Tax year
TAXABLE YEAR: -- The period (usually 12 months) during which the tax liability of an individual or entity is calculated.
TAXATION AT SOURCE: -- See: Withholding tax
Tax-Exempt Bonds: Debt securities issued by a state, county, city, or other political entity (such as a school district) that generate income which is exempt from federal income taxes. Income from such bonds may also be exempt from state income taxes in the state in which the bond is issued. However, some tax-exempt bonds may be subject to the federal alternative minimum tax. Bond prices rise and fall daily. Municipal bonds are subject to a variety of risks, including adjustments in interest rates, call risk, market conditions, and default risk. When interest rates rise, bond prices generally will fall. Certain municipal bonds may be difficult to sell. A municipal bond issuer may be unable to make interest or principal payments, which may lead to the issuer defaulting on the bond. If this occurs, the municipal bond may have little or no value. If a bond is purchased at a premium, it may result in realized losses. It’s possible that the interest on a municipal bond may be determined to be taxable after purchase.
TAX-FREE ZONE: -- Area within the territory of a country in which customs duties and other types of indirect taxes are not applied.
Taxonomy: is a system of order that serves as the foundation for codifying knowledge. For example, a KM taxonomy focuses on enabling the efficient retrieval and sharing of knowledge, information, and data across an organization. It is built around work processes and knowledge needs in an intuitive structure.
TAXPAYER IDENTIFICATION NUMBER: -- In some countries taxpayers are given an identification number which must be used when filing a tax return and assessing taxes and for all other correspondence between the taxpayer and the tax authorities.
TAX-WISE GENEROUS GIVING: You may be surprised how much you have to offer to the ministries and charities you value, not only financially, but through the investment of your time and talent as well. Our team can help you do what you love most with the organizations your heart treasures.
Team building: is a process for transforming an ineffective or dysfunctional group into an efficient, productive team through various experiential learning activities, including data review, interpersonal activities, exploring problems and challenges, and establishing action plans for change.
Teaser: This is a very short document, often a 2 page PDF that your investment bank sends out to flag to the market that you’re thinking about a process. It includes some very high level information on your business and its key job is to see what the initial market interest is.A teaser is really the first outwardly visible part of your process, assuming your appointment of advisors has remained a secret.
Technical Analysis: A method of evaluating securities by examining recent price movements and trends in an attempt to identify patterns that can suggest future activity. Generally, technical analysis is the opposite of fundamental analysis.
Technology Application: refers to practitioners ability to identify opportunities to adapt and leverage the right technologies at the right time to meet organizational and people development goals.
Technology Based training: Methods mainly using technology, which may include tutorials embedded in software, CD ROM products, Web-based courses and interactive media
TEMPORARY IMPORTATION: -- Many countries allow temporary importation without levying customs duties and turnover tax on items which are to be within their borders for only a short time.
Tenancy by the entirety (TE): – An interest in property that can be held only between a husband and wife in which each person has the right of survivorship over the property and which neither person can terminate without the consent of the other. At death, the surviving spouse takes title to the property without probate proceedings. In accordance with IRS laws, TE ownership is considered to be owned 50 percent by each, husband and wife. Therefore, the surviving spouse receives a stepped- up tax basis to the “fair market value” for the 50 percent received from the deceased spouse’s estate. The surviving spouse now has two basis in the property:1) The original basis for the 50 percent owned before the death of the spouse and 2) the stepped-up basis in the 50 percent inherited from the estate of the deceased spouse.
Tenancy by the Entirety.: In most states, spouses can hold property as tenants by the entirety, a form of joint tenancy with rights of survivorship that also affords additional protection for one spouse from the creditors of the other.
Tenancy in Common: A form of property ownership under which two or more people have an undivided interest in the property and in which the interest of a deceased owner passes to his or her beneficiaries rather than to the surviving owners.
Tenancy in common (TIC): – The ownership of property by two or more individuals who own an individual, undivided share of interest of the whole property. Each owner has the right to transfer to another person his/her ownership interest. A TIC typically has no right of survivorship. Thus, if person A and person B are tenants in common of a parcel of land and A dies, A’s ownership in the parcel goes to the party identified in A’s will – not necessarily B.
Tenant: – a person (may include a company) who holds or possesses property.
Tenants in Common.: Tenants in common each own a separate and undivided interest in the same real property or other asset. Upon the death of one tenant, his or her undivided interest passes to his or her heirs or legatees through probate or a trust.
Term Insurance: Life insurance that provides coverage for a specific period. If the policyholder dies during that time, his or her beneficiaries receive the benefit from the policy. If the policyholder outlives the term of the policy, it is no longer in effect. Several factors will affect the cost and availability of life insurance, including age, health, and the type and amount of insurance purchased. Life insurance policies have expenses, including mortality and other charges. If a policy is surrendered prematurely, the policyholder also may pay surrender charges and have income tax implications. You should consider determining whether you are insurable before implementing a strategy involving life insurance. Any guarantees associated with a policy are dependent on the ability of the issuing insurance company to continue making claim payments.
Term life insurance: – An insurance policy with a set duration limit on a coverage period.
Term sheet: A term sheet is a nonbinding agreement which sets forth the basic terms and conditions under which an investment will be made. It serves as a template to develop more detailed legally binding documents. Once the parties involved reach an agreement on the details laid out in the term sheet, a binding agreement or contract that conforms to the term sheet details is then drawn up.
TERRTORIALITY PRINCIPLE: -- Term used to connote the principle of levying tax only within the territorial jurisdiction of a sovereign tax authority or country, which is adopted by some countries. Residents are not taxed on any foreign-source income.
Testament: – Latin, meaning a will. It is the formal written document produced when a person records their intentions as to the disposal or transfer of their personal property for when they pass away. Its operation is triggered only on the event of death. In modern will writing the phrase “Last will and testament” has been reduced to ‘last will’.
Testament): ; how a person wants their personal property dealt with on the event of their death.
Testamentary: – Pertaining to a will.
Testamentary-: related to a will (see
Testamentary disposition: – the disposal or transfer of property on death.
Testamentary expenses: – expenses made in the process of finalising a deceased estate such as funeral costs, applying for probate, professional advice, protecting assets of the deceased and paying the executor/s commission where provided for or if granted.
Testamentary intention: – refers to a person’s strong desire to prepare a document which they intend to operate as their final record on what is to be done with their property when they die. Their intention is to do this, that is, make a will, freely, without influence, and in full knowledge of its effect.
Testamentary Trust: A trust created by a will or trust that is established on the death of the trustor. Using a trust involves a complex set of tax rules and regulations. Before moving forward with a trust, consider working with a professional who is familiar with the rules and regulations.
testamentary trust.: Executors are often appointed to act as trustees where a trustee role is required following administration of the estate. However professional advisers or their firms may also be appointed depending on the circumstances.
Testate: – To die without a will.
Testator: – a person who makes a will. Testator refers to a male person making a will and testatrix for a female. The term testator is now used to include references to both male and female.
Testator.: A person who makes or has made a Will.
Testatrix: – female form of testator, a female who makes a will. This term is no longer used. Testator is the preferred term used generally. Nor are the terms executrix and adminisatratix used in court documents.
Theory X: is a theory of human motivation developed by Douglas McGregor in the 1960s. The theory assumes that employees are inherently lazy, dislike work, and will avoid it if they can. Belief in Theory X leads to a management philosophy of close supervision and tight control of employees.
Theory Y: is a theory of human motivation developed by Douglas McGregor. In contrast to Theory X, Theory Y assumes that most employees are self-motivated, enjoy working, and will work to achieve goals to which they are committed. Belief in Theory Y leads to a management philosophy of trust that employees will take responsibility for their work and do not need constant supervision.
THIN CAPITALISATION: -- A company is said to be "thinly capitalised" when its equity capital is small in comparison to its debt capital.
THIN CORPORATION: -- A corporation whose capital is supplied primarily by shareholder loans rather than stock investment.
this article: for reasons why.
THREE-FACTOR APPORTIONMENT FORMULA: -- A formula used by most US states to apportion total federal business income for out-of-state entities in order to determine the tax due a particular state. The formula equally weights the payroll factor, property factor, and sales factor.
TIEA: -- See: Tax information Exchange Agreement
TIEBREAKER RULE: -- Tax treaty provision designed to prevent an individual from being deemed resident, for purpose of the treaty, in both treaty countries. Generally a multi-step procedure will be provided to resolve the problem of dual residence, usually the place of a permanent home available being the first criterion.
Time Horizon: The amount of time an investor plans to hold an investment or portfolio of investments.
TIPS (Treasury Inflation Protected Securities): Inflation-indexed bonds issued by the U.S. Treasury where the principal is adjusted to the Consumer Price Index.
Title: – The right to or ownership of something. A deed indicates or conveys title to real property.
Title by descent: – Laws that direct how a deceased’s assets shall be divided to heirs when no will exists.
Torrens Title: system of land registration in Australia – is ownership of real property, land proved by registration.
TORT: -- A private and civil wrong or injury, other than breach of contract, for which a court will provide a remedy in the form of an action for damages.
Total Return: The total of all earnings from an investment or portfolio, including both capital appreciation and any income received.
TRADE: -- A business, profession, or occupation. A trade often implies a skilled handicraft, which is pursued on a continuing basis, such as carpentry.
TRADE INTANGIBLE: -- A commercial intangible other than a marketing intangible.
TRADE OR BUSINESS: -- A regular and continuous activity undertaken for a profit, other than that of an investor trading in securities.
Trade sale: When the shareholdings in a company are sold to another trading company which is not an investment firm.
Trade Sale or Trade Deal: When you sell your business to another business, sometimes a competitor rather than a financial sponsor like a PE firm. Also known as “A Strategic”, eg “They sold to a strategic”, meaning they sold to a strategic buyer.Strategic buyers are revered because they can, and often do, pay more for a business that PE can because they are buying for a strategic reason, rather than a purely financial reason. See
TRADEMARK: -- Legally registered name, word, symbol or design which identifies the goods or services of a particular manufacturer, business or company.
Traditional Classroom training: Individual or multiple person led; face-to-face training.
TRADITIONAL TRANSACTION METHODS: -- The comparable uncontrolled price method, the resale price method, and the cost plus method.
Trainer: is a person who helps individuals improve performance by facilitating learning in a traditional or virtual classroom, one-on-one, or on-the-job in an organization.
Training: The process of providing for and making available to an employee, and placing or enrolling the employee in, a planned, prepared, and coordinated program, course, curriculum, subject, system, or routine of instruction or education, in scientific, professional, technical, mechanical, trade, clerical, fiscal, administrative, or other fields which will improve individual and organizational performance and assist in achieving the agency’s mission and performance goals;
Training Alignment: Using different talent management strategies, such as skills gap andtraining needs analysis will help to match training to the needs ofindividuals.
Training Delivery ( and Facilitation): are means by which talent development professionals help individuals improve performance at work by learning new skills and knowledge.
Training Matrix: A table with employees on one axis and training on the other. It helpsidentify training gaps and match employees and candidates to job roles.
Training Needs Analysis: Training needs can be defined as: a shortage of skills or abilities, whichcould be reduced or eliminated by means of training and development(University of London, 2006). A training needs analysis is therefore theprocess of identifying the skills deficiency and associated training need.
Training Objective: is a statement of what the instructor hopes to accomplish during the training session.
Training Plan: A training plan consists of all the development schemes and training thatan individual will attend/take part in, with the aim of aligning their skillsets and attributes with the company goals and objectives.
Training Program: Organized set of development activities resulting from a comprehensive needs assessment and directed toward the measurable improvement of individual results while also contributing to achievement of the agency’s mission and performance goals.
Training Program Evaluation: Training program evaluation is a continual and systematic process of assessing the value or potential value of a training program. Results of the evaluation are used to guide decision-making around various components of the training (e.g. instructional design, delivery, results) and its overall continuation, modification, or elimination.
Training Transfer Evaluation: is a process to measure the success of the learner's ability to transfer and implement learning on the job.
TRANSACTION TAXES: -- Tax that uses a specific type of transaction as its object, e.g. sales tax, immovable property transfer tax, etc.
TRANSACTIONAL NET MARGIN METHOD: -- A transactional profit method that examines the net profit margin relative to an appropriate base (e.g. costs, sales, assets) that a taxpayer realizes from a controlled transaction (or transactions that it is appropriate to aggregate under the principles of OECD TP guideline Chapter I).
TRANSACTIONAL PROFIT METHOD: -- A transfer pricing method that examines the profits that arise from particular controlled transactions of one or more of the associated enterprises participating in those transactions.
Trans-Atlantic: A transaction that involves at least one company from the United States, Canada, Central America or the Caribbean tying up a deal with one or more companies from Europe. All transatlantic deals will be identified as cross border.
Transfer on death (TOD): – Designation on securities that allows the naming of a beneficiary to receive them upon the death of a party.
TRANSFER PRICING: -- A transfer price is the price charged by a company for goods, services or intangible property to a subsidiary or other related company. Abusive transfer pricing occurs when income and expenses are improperly allocated for the purpose of reducing taxable income.
TRANSFER PRICING ADJUSTMENT: -- Adjustment made by the tax authorities after making a determination that a transfer price in a controlled transaction between associated enterprises is incorrect or where an allocation of profits fails to conform to the arm's length principle.
TRANSFER TAX: -- Tax levied on the transfer of goods and rights, e.g. purchase and/or sale of securities and immovable property.
Transmission: – to transfer, pass on or hand down property to successors on death by will or the rules of intestacy. In NSW the word transmission is defined in section 3 of the Real Property Act 1900 as:The acquirement of title to or interest in land consequent on the death, will, intestacy or bankruptcy of a proprietor.
TRANSPORTATION TAX: -- Tax levied on vehicles, ships and aircraft using public highways, rivers, and airports maintained by the government.
Treasuries: Debt securities issued by the United States government. Treasury bills normally have maturities of less than one year, while Treasury notes have maturities between one and 10 years, and Treasury bonds have maturities between 10 and 30 years. U.S. Treasury securities are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury security prior to maturity, it could be worth more or less than the original price paid.
TREATY ON EUROPEAN UNION (EU): -- The treaty on European Union was signed on 7 February 1992 and entered into force on 1 November 1993. This treaty creates a single economic and monetary union (EMU). The main characteristics of this union will be a single currency and a more federal political structure. By virtue of the Union Treaty, the former European Economic Community has been extended with additional goals and powers in order to become a single market in a European Union. The member states of the EU are Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and the United Kingdom. On May 2nd 2004, Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, and Slovenia newly joined the EU.
TREATY OVERRIDE: -- Term broadly used to refer to the subsequent enactment of legislation which conflicts with prior treaty obligations. As a general rule, the provisions of a tax treaty implemented domestically prevail over other domestic legislation. However, in some countries the relations is governed by the "last in time" rule.
TREATY SHOPPING: -- An analysis of tax treaty provisions to structure an international transaction or operation so as to take advantage of a particular tax treaty. The term is normally applied to a situation where a person not resident of either the treaty countries establishes an entity in one of the treaty countries in order to obtain treaty benefits.
Triple-Loop Learning: is a model (along with single- and double-loop learning) that helps TD professionals understand the dynamics of learning that is frequently defined as "learning how to learn." Learners reflect beyond what they learned to how they learned, how they think about what they learned, and how others feel about what was learned. This causes them to transform by willingly altering their beliefs and values about themselves and about the world.
Trust: – Ownership and control of property by a third party (trustee) who manages the property and pays the income to a named beneficiary according to the instructions given by the person setting up the trust and who transfers property into it.1. Generation-skipping trusts - Trusts that are used to provide income to a generation or two of heirs, with the property eventually passing to individuals two or three generations down the line.2. Inter vivos trust (living trust) - A trust that takes effect during the life of its creator. However, the trust may continue after death.3. Living trust - A trust established during the lifetime of the grantor.4. Testamentary trust - A trust that is intended to come into existence at death. Its purpose is to provide for the management of property after death. They often are contained in an individual’s will.5. Revocable trust - A trust that is included as part of the taxable estate and can be revoked any time. The revocable trust can take on many different versions and may require special language to work through tax planning with a large taxable estate.6. Irrevocable trust - A trust that is irrevocable and is not counted as part of the taxable estate. This trust should be used sparingly and only if the estate has significant tax problems. Once assets are put into the irrevocable trust, they cannot be removed, and the owner forever loses control, access and the benefit of the items placed in an irrevocable trust.7. Life insurance trust - This is a special irrevocable trust that holds life insurance policies to exclude them from the gross estate. When a policy is not in the irrevocable trust and the decedent maintained control, it is counted as part of the gross estate.8. Special-needs trust - This can be a revocable or irrevocable trust that is formed for a special-needs child, pet, business, real estate or other property that requires specific and special attention post- death.9. Charitable remainder trust - A tax-exempt irrevocable trust designed to reduce the taxable income of individuals by first dispersing income to the beneficiaries of the trust for a specified period of timeand then donating the remainder of the trust to the designated charity.
Trust Agreement.: The document which creates a trust and establishes the rules which control the trust’s management.
Trust corpus: – The subject matter of the trust. Definite and ascertainable property that is transferred to the trustee.
Trust Property: Assets held in trust.
Trust Protector: . Where a trust is designed to last for multiple generations, or there are concerns about a trustee's abilities, a trust protector may be designated with specified, limited responsibilities. Trust protectors frequently are given the power to remove and replace trustees and to modify the administrative terms of testamentary and irrevocable trusts to adjust for changes in tax laws and trust administration practices. For a more in-depth review of what a Trust Protector is, and does,
Trust.: A legal relationship where property is transferred to and managed by a person or institution for the benefit of another person.
Trustee: – a person (or company) appointed to hold property on trust for others, the beneficiaries subject to the terms set out in a will, as a
Trustee Distribution Advisor: . Other appointed individual(s) serving in a quasi-fiduciary role in which the individual would not have all of powers of a Trustee but could make recommendations or provide direction to theTrustee with respect to distributions or investments. For example, if you name as Trustee a bank or trust company or an individual who is not intimately knowledgeable of your children's day-to-day circumstances, you may want to designate a distribution advisor to inform the trustee of the child's needs .
Trustee.: The person or institution entrusted with the duty of managing property placed in the trust. A “co-trustee” serves as trustee with another. A “contingent trustee” becomes trustee upon the occurrence of a specified future event. A "successor trustee” takes the place of a trustee who can no longer perform his or her duty.
Trustee-to-Trustee Transfer: A method of transferring retirement plan assets from one employer's plan to another employer plan or to an IRA. One benefit of this method is that no federal income tax will be withheld by the trustee of the first plan.
Trustor: – A person making a trust.
Trusts: A legal arrangement whereby a person gives real or personal property to another person to be managed for the benefit of the giver, another person, or an entity such as a charitable organization. Trusts are often used in estate planning and for asset protection.
TURNKEY CONTRACT: -- Broadly, a contract to construct a complete project; for example, a factory, plant or installation, from the bare site to the stage where the user only need to "turn the key" to put the project to immediate use.
TURNOVER: -- Volume of business of an enterprise as set forth in the profit and loss account. It is usually measured by reference to the gross receipts, or gross amounts due, from the sale of goods or services, etc. supplied by the entity.
TURNOVER TAX: -- General term used to refer to the different forms of consumption and sales taxes.
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Unconscious biases: are learned stereotypes that unintentionally influence behavior. They are deeply ingrained, which causes them to occur automatically.
UNCONTROLLED TRANSACTION: -- Transaction between independent and unrelated enterprises.
UNDER-CAPITALISATION: -- See: Thin capitalisation
UNDERLYING TAX: -- Tax which is charged on corporate income out of which dividends are paid, but which does not appear as a direct deduction or withholding from the dividend itself.
UNDERLYING TAX CREDIT: -- See: Credit, underlying tax
UNDISTRIBUTED PROFITS TAX: -- Annual tax imposed, in addition to the normal corporate income tax, on the undistributed portion of the profits or surplus of a corporation.
Undivided interest: – The interest or right in property owned by each joint tenant or tenant in common. Each tenant has equal right to use and enjoy the entire property. Unless an agreement to the contrary exists, each tenant is entitled to an income share proportional to his or her ownership interest. If the property is sold, the sale proceeds are shared among tenants in proportion to the ownership shares held by each tenant.
UNDUE HARDSHIP: -- A substantial financial loss that would result to a taxpayer from making payment on the due date of the amount of taxes with respect to which the extension is desired. Undue hardship is a condition precedent to the granting of an extension of time to make a tax payment.
Undue influence: – A term referring to a situation in which a person improperly or wrongfully persuades or takes over the mind of another person to make that person’s will conform to that of another person. The dominion and control must be such that the free will of another is overcome and the influenced person is caused to do what he or she would not otherwise have done but for the dominion and control. The influence must have been so great that the testator lost the ability to exercise his/her own judgment and could not refuse to give in to the pressure being exerted.
UNEARNED INCOME: -- Term used to describe investment income such as dividends, interest and royalties.
Uniform Gift to Minors Act (UGMA): An act available in some states that allows assets to be held in a custodian’s name for the benefit of a minor without the need to set up a trust. Once the child to whom the assets have been gifted reaches the age of maturity in his or her state, the assets become his or her property and can be used for any purpose.
UNILATERAL RELIEF: -- Granting of relief from the effects of international double taxation on the basis of domestic legislation rather than the provisions of a tax treaty.
UNIMPROVED PROPERTY: -- Land that has received no development, construction, or site preparation (i.e. raw land).
UNITARY TAX SYSTEM: -- Under a unitary tax system, the profits of the various branches of an enterprise or the various corporations of a group are calculated as if the entire group is a unity. A formula is used to apportion the net income of the whole group to the various parts of the group. Usually a combination of property, payroll, turnover, capital invested, manufacturing costs, etc. are formula factors.
Universal Life Insurance: A type of life insurance that combines a death benefit with a savings element that accumulates tax deferred at current interest rates, subject to change, but with a guaranteed minimum. Under a universal life insurance policy, the policyholder can increase or decrease his or her coverage, with limitations, without purchasing a new policy. Universal life is also referred to as "flexible premium" life insurance. Access to cash values through borrowing or partial surrenders can reduce the policy's cash value and death benefit, increase the chance that the policy will lapse, and may result in a tax liability if the policy terminates before the death of the insured. Policy loans or withdrawals will reduce the policy's cash value and death benefit. Additional out-of-pocket payments may be needed if actual dividends or investment returns decrease, if you withdraw policy values, if you take out a loan, or if current charges increase. There may be surrender charges at the time of surrender or withdrawal and are taxable if you withdraw more than your basis in the policy. Any guarantees are contingent on the claims-paying ability of the issuing company. The cost and availability of life insurance depend on factors such as age, health, and the type and amount of insurance purchased.
UNLIMITED LIABILITY: -- Liability of an investor which extends to the full extent of his personal assets, as in the case of a sole proprietor or general partner.
Unlimited Marital Deduction: A provision of the tax code that allows an individual to transfer an unlimited amount of assets to his or her spouse at any time—including upon the individual’s death—without triggering a tax liability.
Unsolicited, Hostile: A deal is unsolicited if at announcement the target has not recommended the deal. A deal is hostile if the target management does not recommend within two weeks.
Unsolicited, Recommended: A deal is unsolicited if at announcement the target has not recommended the deal. A deal is unsolicited recommended if the management recommends the deal within two weeks of the announcement date
Upskilling: is training designed to augment existing skills with new or significantly enhanced knowledge. This enables individuals to continue to succeed in the same profession or field of work. Upskilling does not refer to normal, ongoing development.
UPSTREAM DIVIDEND: -- Dividends flowing from a subsidiary company to its parent company.
USE TAX: -- Tax on goods which are used within the taxing jurisdiction although the goods were purchased in another jurisdiction
USEFUL LIFE: -- Period during which it is estimated that a depreciable asset will provide useful service to the business in which it is used.
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VAK Model: is a model of the way that individuals learn and retain information. Some people learn primarily through one style, others through a combination of three: visual (learners need pictures, diagrams, and other visuals), audio (learners need to hear information), and kinesthetic (learners prefer hands-on learning).
Validity Study: A study that determines the extent to which something does what it was intended to do. In the area of talent, for example, an agency might want to validate whether use of a particular recruitment source yielded candidates with the competencies required to support the agency's mission.
VALUATION PRINCIPLES: -- Tax law principles regarding valuation of business and non-business assets, and inventory.
VALUE ADDED TAX (VAT): -- Specific type of turnover tax levied at each stage in the production and distribution process. Although VAT ultimately bears on individual consumption of goods or services, liability for VAT is on the supplier of goods or services. VAT normally utilizes a system of tax credits to place the ultimate and real burden of the tax on the final consumer and to relieve the intermediaries of any final tax cost.
Value Stock: An investment chosen based on a company’s intrinsic value: cash and assets, high dividends, and low debt.
Valuing Practices: Organisations that facilitate the development of a ‘culture of learning’ cansupport training and development further by implementing valuingpractices and being willing to invest in the success of their staff. Forexample, line managers can hold annual reviews that not only benchmarkprogress towards goals and targets, but which take account of widercareer aspirations and then try to align company objectives withindividual ambitions.
Variable Interest Rate: An interest rate that moves up and down with a specific measure or index, such as current money market rates or a lender’s cost of funds.
Variable Universal Life Insurance: A type of life insurance that combines a death benefit with an investment element that accumulates tax deferred. The account value can be allocated into a variety of investment subaccounts. The investment return and principal value of the variable subaccounts will fluctuate; thus, the policy's account value, and possibly the death benefit, will be determined by the performance of the chosen subaccounts and is not guaranteed. Withdrawals may be subject to surrender charges and are taxable if the account owner withdraws more than his or her basis in the policy. Policy loans or withdrawals will reduce the policy's cash value and death benefit and may require additional premium payments to keep the policy in force. There may also be additional fees and charges associated with a VUL policy. Any guarantees are contingent on the claims-paying ability of the issuing company. Variable universal life is sold by prospectus. Please consider the investment objectives, risks, charges, expenses, and your need for death-benefit coverage carefully before investing. The prospectuses, which contains this and other information about the variable universal life policy and the underlying investment options, can be obtained from your financial professional. Be sure to read the prospectus carefully before deciding whether to invest.
Vendor Due Diligence (VDD): Due Diligence is something the buyer performs on your business in order to prove or disprove that your business is an asset worth investing in. But if you, the vendor, are confident of completing a sale you can commission the diligence yourself – this is called Vendor Due Diligence.The advantage of VDD is that you own it so it puts your in much more control of your process. If your discussions with one PE firm break down, you can take your IM and your VDD to another PE firm and continue a discussion there. The downside is that you have to pay for it and if a deal doesn’t happen you won’t be able to bury it in the deal fees.You will use the same advisors to do the DD as your PE firm would – they’ll take money from anyone. But a second advantage is that they’re working for you, whilst attempting to keep some semblance of professional independence, so you will see many drafts of the DD report and can tell them when they’ve got the wrong end of the stick. This is hugely preferable to buyer-DD where you might never see the report and your potential buyer could make a decision based on flawed information or analysis.Back in 2010 when I did my first deal, Vendor DD was still a bit special, but now in 2020, it’s very normal. I highly recommend it because it puts you, not the PE firm, in control.
Vendor Due-Diligence: as you can take your DD with you to the next bidder.
Venture Capital: Venture Capital or VC investors are very different to private equity investors. They invest in startup and early stage investments, pre-revenue, pre-profit, often even pre-product.By contrast, PE investors specialise growing, profitable cash generative businesses.This different approach hugely affects risk, ambition, deal structure and outcomes for entrepreneurs.
VERTICAL EQUITY: -- Doctrine which holds that differently situated taxpayers should be treated differently, i.e. taxpayers with more income and/or capital should pay more tax.
VIENNA CONVENTIONS: -- There are three multilateral "Vienna Conventions" which are relevant for taxation purposes. Among them, the Convention of 23 May 1969 on the Law of Treaties is particularly related to the interpretation of tax and other treaties. This convention contains generally accepted rules applying to tax treaties, the conclusion of treaties, their observance, application and interpretation, etc..There are also Vienna Conventions on Diplomatic and Consular Relations, which address taxation and other issues in that context.
VIMBO – Vendor-initiated Management Buyout: This is where the existing owner (vendor) approaches the existing management team to offer them the opportunity to buy the business.
Virtual classroom: is an online learning space where learners and facilitators interact.
Virtual reality (VR): is computer-generated simulation that uses a head-mounted display to give learners the ability to explore a fully rendered digital environment and manipulate objects with handheld controls and voice commands. This powerful tool allows learners to perform skills in a realistic, engaging simulation of a real-life environment. It’s especially valuable in for training learners
Virtual Representation.: A mechanism provided in a will or trust, or in some instances by state law, or restricted or governed by state law, to allow a beneficiary to make binding decisions on behalf of another beneficiary who claims or receives property only under or after them.
Virtual World: A simulated environment where users can interact with one another and create objects through an onscreen avatar. This type of environment allows course participants to attend live workshops and conferences in a virtual classroom or conference space. Participants are able to interact with each other in much the same way as attending a real workshop or conference. Course project teams can meet and collaborate in a virtual space. Organizations have developed courses using a virtual environment to conduct simulations of various situations including disaster preparedness or medical emergencies. Common virtual worlds include Second Life, Protosphere, and Forterra.
Volatility: A measure of the range of potential fluctuations in a security’s value. A higher volatility means the security’s value can potentially fluctuate over a larger range of potential outcomes—up and down.
VOTING STOCK: -- Shares in a corporation that entitle the shareholder to voting and proxy rights.
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WAGE TAX: Tax -- levied at source as a withholding on wages; taxes thus withheld are usually offset against final income tax liability (if any).
Wants-Based Approach: is a customer approach that focuses primarily on satisfying the client’s needs.
WBT: (Web-Based Training) delivers educational content via a web browser over the public Internet, a private intranet, or an extranet.
WEAR AND TEAR: -- Decline in value through the ordinary use of an asset. Income tax systems usually allow deductions in calculating the profits of a business using buildings, plant and machinery which are subject to wear and tear in the course of the business.
Web-based training: often provides links to other learning resources such as references, email, bulletin boards, and discussion groups. instructor-led training while also retaining the advantages of computer-based training.
Web-conferencing: A method to allow instructors to conduct live meetings, trainings, and presentations via the Internet. Web-conferences allow participants opportunities to ask questions and participate in polls. Common examples of web-conferencing tools are Webex, Adobe Connect, Goto Meeting and Live Meeting
Welfare Benefit Plan: An employee benefit plan that provides such benefits as medical, sickness, accident, disability, death, or unemployment benefits.
WHITE PAPER: -- Government document announcing government policy and practice on a specific issue or issues.
Whole Life Insurance: A type of life insurance that offers a death benefit and also accumulates cash value tax deferred at fixed interest rates. Whole life insurance policies generally have a fixed annual premium that does not rise over the duration of the policy. Whole life insurance is also referred to as "ordinary" or "straight" life insurance. Access to cash values through borrowing or partial surrenders can reduce the policy's cash value and death benefit, increase the chance that the policy will lapse, and may result in a tax liability if the policy terminates before the death of the insured. Policy loans or withdrawals will reduce the policy's cash value and death benefit. Additional out-of-pocket payments may be needed if actual dividends or investment returns decrease, if you withdraw policy values, if you take out a loan, or if current charges increase. There may be surrender charges at the time of surrender or withdrawal and are taxable if you withdraw more than your basis in the policy. Any guarantees are contingent on the claims-paying ability of the issuing company. The cost and availability of life insurance depend on factors such as age, health, and the type and amount of insurance purchased.
Wiki: A website allowing users to create and edit content on any number of interlinked web pages via a web browser. This method is used in learning and development programs to promote collaborative learning and information sharing. Instructors and participants use wikis to create reading lists. Course participants use wikis to for team projects. Organizations use wikis to post internal processes, publish reference guides, and capture best practices.
Will: – is the officially recognised legal record of a person’s intentions as to what they want to have happen to their property when they die. Central to planning ahead it is often part of a wider estate plan. It is a document that seeks to dispose of the estate of a person on their death. For the will to be valid at law it must satisfy certain formalities as prescribed by the wills and succession legislation.In most state and territory wills and succession legislation a “will” is defined to “include a codicil and any other testamentary disposition”. In addition, the various Interpretation Acts can import meanings of certain terms where they are used in the wills and succession Acts.A will also means a gift of property to take effect on death. Property is implied in a will.
Will-maker –: person who makes a will.
WINDING UP: -- The process of liquidating a corporation.
Wisdom: The ability to exercise good judgment in the face of imperfect knowledge.
WITHDRAWALS: --When income or goods are withdrawn from a business by the entrepreneur to his private household (without a consideration), the income or the value of such goods normally constitutes a taxable event in the hands of the recipient for income tax purposes. Similarly, a withdrawal of goods or services for private use constitutes a taxable transaction for VAT purposes in most countries using such a system.
Withholding: The process by which an employer holds back part of an employee’s compensation to pay his or her share of income, Social Security, and Medicare taxes. Amounts withheld are paid to the IRS in the employee’s name.
WITHHOLDING TAX: -- Tax on income imposed at source, i.e. a third party is charged with the task of deducting the tax from certain kinds of payments and remitting that amount to the government. Withholding taxes are found in practically all tax systems and are widely used in respect of dividends, interest, royalties and similar tax payments. The rates of withholding tax are frequently reduced by tax treaties.
Workforce Development: A long-term commitment from a company to continually train itsemployees to meet its strategic goals. Examples of workforcedevelopment include, training planning, mentoring and coaching.
Workforce Planning: Workforce planning is required to ensure that an organisation has suitableaccess to talent to ensure future business success. Failure to prepare aworkforce plan will put you on the back foot with regards to recruitmentin comparison better prepared organisations.
WORKING CAPITAL: -- Funds invested in a company's cash, accounts receivable, inventory, and other current assets (gross working capital). The term usually refers to net working capital, that is, current asset minus current liabilities.
Workplace Learning and Performance: (WLP) encompasses the professions of training, performance improvement, learning, development, and workplace education. It is often colloquially referred to as training or training and development.
WORLD WIDE INCOME: -- Criterion for the income tax liability of a resident company or individual of a certain country. In many countries a resident company or individual is subject to corporate/individual income tax on its worldwide income, subject to double taxation relief.
WRITTEN DOWN VALUE: -- The value of an asset which is depreciable for income tax purposes, determined by deducting from the total cost, including installation, etc. the deduction that have been made for wear and tear or depreciation in previous tax years.
Succession Planning: X
xAPI: is the Experience Application Programming Interface, an e-learning software specification to record learning experiences an individual has on and offline. It’s also known as Tin Can API or the experience API.
Succession Planning: Y
Y: is a disciplined, data-driven approach for improving business processes; the goal is to improve output quality by identifying and eliminating causes for defects (driving toward six standard deviations between the mean and the nearest specification limit) in a process. The fundamental objective of the Six-Sigma methodology is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction through the application of projects.
Yield: Generally, the yield is the amount of current income provided by an investment. For stocks, the yield is calculated by dividing the total of the annual dividends by the current price. For bonds, the yield is calculated by dividing the annual interest by the current price. The yield is distinguished from the return, which includes price appreciation or depreciation.
Succession Planning: Z
ZERO COUPON BOND: -- Long-term bond on which interest is not payable on a regular basis, but rather upon maturity of the bond. It is sold at a deep discount from its face value.
ZERO RATE: -- The term is used in relation to VAT, where the rate of tax which is in principle levied but at a rate of 0% so that in effect no tax is payable, but will result in refunds of input tax credits.
Zero-Coupon Bond: A bond that does not pay interest during its life. Zero-coupon bonds are purchased at a discount from their face value. When a zero-coupon bond matures, the investor receives the face value of the bond. The market value of a bond will fluctuate with changes in interest rates. As rates rise, the value of existing bonds typically falls. If an investor sells a bond before maturity, it may be worth more or less that the initial purchase price. By holding a bond to maturity, an investor will receive the interest payments due plus his or her original principal, barring default by the issuer. Investments seeking to achieve higher yields also involve a higher degree of risk. Bond prices rise and fall daily. Bonds are subject to a variety of risks, including adjustments in interest rates, call risk, market conditions, and default risk. When interest rates rise, bond prices generally will fall. Certain municipal bonds may be difficult to sell. A bond issuer may be unable to make interest or principal payments, which may lead to the issuer defaulting on the bond. If this occurs, the bond may have little or no value. If a bond is purchased at a premium, it may result in realized losses. It’s possible that the interest on a municipal bond may be determined to be taxable after purchase.
Succession Planning: J
JEOPARDY ASSESSMENT: -- Tax assessment made where there is some danger of tax being lost.
job: A generic role that's independent of any single department or location. For example, the jobs Manager and Consultant can occur in many departments.
Job Aid: is a tool that provides guidance about when and how to carry out tasks and steps. Job aids reduce the amount of recall needed and minimize error. They may take the form of checklists, video demonstrations, or audio instruction.
Job Architecture: A talent orientated structure used to efficiently assign competencies across the organization, compromising of Functional Areas, Job Families, Jobs and Positions and allowing inherited competencies down the structure
Job Family: A logical grouping of jobs that have similar attributes or characteristics
Joint and Survivor Annuity: Most pension plans must offer this form of pension plan payout that pays over the life of the retiree and his or her spouse after the retiree dies. The retiree and his or her spouse must specifically choose not to accept this payment form.
Joint Ownership with Rights of Survivorship.: This is a common form of asset ownership. This form of ownership has the advantage of avoiding probate at the death of the first joint tenant and therefore allowing for the quick and efficient transfer. However there is no form of “limited” joint ownership, and joint ownership may subject assets to loss through the debts, malfeasance, bankruptcies, divorces and/or lawsuits of additional joint tenants.
JOINT RETURN: -- A single return made jointly by husband and wife.
Joint tenancy: – a way of owning property with another person. If one dies the property automatically passes to the other by the operation of law, the survivor having a ‘right of survivorship’. Property held by joint tenants passes outside of a will. Typically a husband and wife own the family home as joint tenants. However when the sole survivor dies, the property will pass according to that person’s will, or if no will, in line with the statutory rules on intestacy.
Joint tenancy with rights of survivorship (JTRS): – A conveyance or devise to two or more people as joint tenants or as joint tenants with rights of survivorship creates a form of ownership with survivorship-ownership by two or more individuals in which all owners must agree to any transactions involving sale, gift or use of borrowing purposes. At death, the surviving joint tenants take title to the property without probate proceedings. The IRS considers 100 percent of JTRS property value as part of the “gross estate” subject to estate taxes unless valid evidence is provided showing different percent ownership.
JOINT VENTURE: -- Term which is loosely used to describe a relationship between parties carrying on an undertaking in common for their individual or common gain. This can be either an incorporated venture or an unincorporated venture.
Jointly Held Property: Property owned simultaneously by more than one person. All co-owners have an equal right to use the property, and no co-owner can exclude another co-owner from the property. The most common forms of jointly-held property are joint tenancy, tenancy in common, and, in some states, community property.
JOINT-STOCK COMPANY: -- Company with legal personality and whose capital is divided into shares. The shareholders are generally liable only to the extent of the nominal value of their shares.
JUNK BOND: -- Bonds and debentures issued by companies that have a low credit evaluation (i.e. below investment grade) from a rating agency such as Standard & Poor's or Moody's
JURIDICAL DOUBLE TAXATION: -- See: Double taxation, economic and juridical
JURISDICTION: -- The power, right, or authority to interpret and apply tax laws or decisions.