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Ordinary Shares

This refers to the equity ownership in a company with an entitlement to vote on shareholder matters but with no preferential rights. Ordinary Shares receive dividends if any remain after dividends on preferred shares are paid. They are also entitled to a share of the residual economic value of the company when it is closes down;… Read more

Corporate Governance

This refers to the controls and responsibilities of participants in an organisation to ensure it carries out its business properly. Corporate Governance is a general term which is applied to organisational controls and processes including setting and monitoring corporate objectives and policies. It typically refers to the responsibilities of directors and senior managers to ensure… Read more

Earnings per Share

This refers to a measure of a business’s performance as an investment. Earnings per Share is calculated by the total earnings (the overall profit generated by the business) divided by the number of shares outstanding. Earnings per Share is a term normally found in economics and financial management; explore our learning resources to discover more.

International Accounting Standards Board (IASB)

This refers to the independent body responsible for setting accounting standards. The IASB issues and maintains accountancy’s International Financial Reporting Standards (IFRS) which set the framework for the production of financial accounts and reports for businesses across the world. The IASB is a term normally found in financial reporting and auditing.

International Federation of Accountants (IFAC)

This refers to the global organisation that establishes and maintains international standards on ethics, auditing and assurance, accounting education, and public sector accounting. The IFAC carries out its work through the International Auditing and Assurance Standards Board, the International Ethics Standards Board for Accountants, the International Public Sector Accounting Standards Board, and the International Accounting… Read more

European Commission (EC)

This refers to the is the executive body of the European Union (EU) responsible for proposing legislation, implementing decisions and the day-to-day running of the EU. The EC may refer to its members who represent member countries or, more typically, the civil service which administers EU legislation. EU legislation impacts on areas of business such… Read more

Relevance

This refers to one of the IASB’s qualitative characteristics for financial information. It means that it should be what is needed and expected in order to understand the information and to take decisions based on that information. Relevance is a term normally found in financial reporting.

Reliability

This refers to one of the IASB’s qualitative characteristics for financial information. Reliability means it should be accurate, true and fair. Reliability is a term normally found in financial reporting.

Comparability

This refers to one of the IASB’s qualitative characteristics for financial information. Information should be comparable to other organisations (through the adoption of common standards) and between accounting periods (through the consistent application of those standards across time). Comparability is a term normally found in financial reporting.

Going concern concept

This refers to a principle of accounting that states that financial statements are produced on the assumption that a business will continue to operate for the foreseeable future. Without the going concern concept; concepts such as accruals, prepayments and depreciation would be invalid. The going concern concept is a term normally found in financial accounting… Read more