Resources
Glossary
The terms used on this site, defined plainly: what each one means, and why it matters to a group closing its books.
Definitions written for someone who has to do the work, not for someone marking an exam. Each term says what it means, and what usually goes wrong with it.
- Chart of accounts
- The list of accounts a ledger posts to, and the structure that groups them.
- Consolidation
- Combining the accounts of a parent and its subsidiaries into one set of statements, as though the group were a single company.
- Cost allocation
- Spreading a shared cost across the parts of a business that caused it, using a stated driver.
- Financial close
- The work between the end of a period and reliable, reportable numbers for it.
- Functional currency
- The currency of the main economic environment an entity operates in, which decides how its results are translated for the group.
- Ind AS
- The Indian Accounting Standards, India's IFRS-converged framework, notified under the Companies (Indian Accounting Standards) Rules.
- Intercompany elimination
- Removing transactions and balances between group companies, so the group does not report sales to itself as revenue.
- Management performance measure
- A subtotal a company uses publicly to describe its own performance, which the accounting standards do not define. Adjusted EBITDA is the familiar one.
- MIS
- Management reporting: the numbers a business runs on, cut the way the business is actually organised.
- Non-controlling interest
- The share of a subsidiary's equity and profit that belongs to shareholders outside the group.
- Schedule III
- The format the Companies Act, 2013 prescribes for the financial statements of an Indian company, including the notes.
- SEBI LODR
- SEBI's Listing Obligations and Disclosure Requirements Regulations, which set what a listed Indian company must disclose and when.
- Top-side adjustment
- An entry made at group level rather than in a subsidiary's ledger, to correct or reclassify something for the consolidated statements.
- Trial balance
- The list of every account in a ledger with its closing balance, where debits equal credits.