Follow us as we talk about the key terms that business men and women absolutely need to have a good comprehension of.
Without any doubt, one of the most essential financial terms to know in terms of business is assets. But just what precisely are assets? Well, simply put, assets are any important things a business is in possession of. This incorporates cash and receivables, property, inventory and so forth. They are assets that have value in an exchange. Assets can be either long-term or short-term and the variation between the two might be whether they last three, five, or even 20 years. Capital assets are regarded as long-term assets and are also referred to as fixed assets. You just know that huge organisations like RIU Hotels have countless assets – it is pertinent to have them if an enterprise is looking to be successful. Venture capital is another superb term to have an understanding of. To put it clearly, venture capital is cash that is invested in brand new or growing businesses that are recognized as having great profit potential. This term is commonly mentioned in business language so it’s a fantastic suggestion to have a good understanding of it.
If an individual is to come by several general business terms, one term they are very likely to come across quite often is the acronym AGM. An AGM, or annual general meeting, is a compulsory annual gathering of a business's investors. At the Telecom Italia AGM, as an example, the directors of the business will present a really important report containing information for shareholders about the company's performance and strategy. In turn, these shareholders with voting rights get to vote on current issues, like appointments to the business's board of directors and executive compensation. All of the most crucial decisions of the running of a business are made during an AGM. Needless to say, it really is an important part of running any successful company, specifically when attempting to grow or expand an enterprise.
One of the most invaluable basic business terms to know is operating expenses. These are all types of expenses incurred while conducting common business processes, such as wages, salaries, administrative and research costs, as well as development costs. These are all very important components to all businesses. Big businesses such as Novo Banco are likely to have extremely high operating expenses, making it even more essential that its profits are high enough to offset the amount favourably. Capital input is another very crucial aspect of business vocabulary to understand. This phrase is frequently referred to as investment, or new investment, and has to do with any new funds being invested into a company – not as loans, but rather as money invested in ownership. This investment will clearly raise in value if a business does very well, but will reduce if the opposite were to take place. Like all investments, a huge element of risk is involved.