| Welcome to the Lighthouse Business Glossary. Please note that different definitions may be appropriate in a particular context.
A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W
A contract clause that requires payment of the full amount of the debt owed if a payment is missed or another triggering event (such as bankruptcy of the debtor) occurs. This type of clause often appears in promissory notes or loan agreements. Trade accounts of businesses representing amounts owed for goods or services received. Trade accounts of businesses representing amounts due for goods sold or services rendered. The recording, classifying, summarizing, and interpreting of events of a financial character. These events can include income, expenses, and cash flow. An accounting system in which income is recorded when it is earned rather than when it is paid, and expenses are recorded when an obligation is established rather than when the money is paid. An attachment or exhibit to a written document, such as a contract. A person granted the authority to act on behalf of another person or entity, known as the “principal.” The actions and decisions of the agent can be binding on the principal. Age Discrimination in Employment Act (ADEA). A federal law that prohibits employers from discriminating against individuals age 40 or more. This law generally applies to companies with 20 or more employees. Alternative Dispute Resolution (ADR). An approach to conflict resolution designed to avoid court proceedings. ADR traditionally encompasses two main forms: arbitration and mediation. Americans with Disabilities Act (ADA). A federal law that prohibits discrimination against those with physical or mental disabilities in employment, public services and public places, such as restaurants, hotels and shops. The ADA requires companies with 15 or more employees to make reasonable accommodations to enable qualified disabled employees to perform their job. Paying off debt in regular installments over a period of time, or deducting certain capitalized expenditures over a specified period of time. The increase in the value of an asset. A form of alternative dispute resolution in which a neutral third party (an arbitrator) considers the competing parties´ arguments and evidence and renders a decision or award. Arbitration can be binding or non-binding. Anything that an individual or an entity owns that has value. Cash, equipment and stocks are all considered assets. To give or sell a right or an interest. The person who receives the right or interest is the “assignee” and the person making the transfer is the “assignor.” The policy allowing employers or employees to end an employment relationship at any time for any reason — or for no reason at all. In some states, the law may place practical limits on this policy. A review or examination of an individual’s or organization’s records to determine legal compliance or proper record keeping. A decision rendered by a court or arbitrator that one party in a dispute is owed money and that the other party or parties are liable. A copy of a file or application that is kept separate from the original as a precaution against data loss in the event the original is lost or destroyed. A financial statement that includes a company´s assets and liabilities. A company’s net worth is equal to its assets minus its liabilities. Bankruptcy. A common form of online advertising, banner ads come in a variety of sizes and typically appear on a Web page as a box or rectangle containing text, images, animation or other effects. Users who click on a banner typically follow a hyperlink to the advertiser´s Web site. A test version of software issued prior to a final commercial release. Securities issued by the U.S. government, corporations, federal agencies, or state or local municipalities. Bonds are sometimes further classified as follows:
A cash award granted to employees by the employer, usually based on personal and/or company performance. Bonuses can also come in the form of extra vacation time, gifts and other nonmonetary awards. A marker or address that identifies a Web site or Web page. Most Web browsers, such as Microsoft Internet Explorer (which calls bookmarks “Favorites”), allow users to save and organize bookmarks as a convenient way to mark Web sites for future reference. The process of starting (or restarting) a computer. The term boot drive or boot disk refers to the disk drive from which the computer loads its operating system. A small company or firm that specializes in a particular industry or provides a limited service, such as investment banking firms that concentrate solely on technology companies. A common measure of data transmission speed. A violation of or failure to perform according to the terms and conditions of an agreement. A high-speed transmission medium. T-1, ISDN, DSL and cable modems are broadband media. Besides downloading Web pages more quickly, broadband can also transmit high-quality streaming video. A hyperlink that does not work, usually because the URL is incorrect or the Web page to which the link refers has been moved or deleted. Software that lets you view Web sites. Most browsers display text, images, graphics, animation and other online content. Popular browsers include Netscape Navigator and Microsoft Internet Explorer. A programming error that causes computer software to malfunction or generate errors. A planning document that describes a company, its market, its management team, its potential, its competitors, and all other relevant information about its business and its prospects. (Compact Disc - Read-Only Memory). An optical storage technology that encodes data on a laminated metallic disc. One CD-ROM holds about 600 megabytes, equal to more than 400 floppy disks. Unlike a floppy disk, you cannot erase or edit the data on a CD-ROM. An employee benefit plan where employees use pretax salary or wages to create their own customized benefits package. Employees may be able to take cash (which becomes taxable) for unused credits or convert more pretax dollars to pay for more benefits. Also known as a flexible benefits plan. A fee for breaking a contract. Many cellular phone service contracts impose a cancellation fee for ending the contract before the end of its term. The text accompanying an illustration or photograph.
(1) Assets less liabilities, representing the ownership interest in a business, (2) a stock of accumulated goods, especially at a specified time and in contrast to income received during a specified time period, (3) accumulated goods devoted to the production of goods, and (4) accumulated possessions calculated to bring income. Business spending on additional plant equipment and inventory. An incentive offered by the seller to encourage a buyer to pay within a stipulated time. For example, if the terms are 1%/10/net 30, the buyer may deduct 1 percent from the amount of the invoice (if paid with 10 days); otherwise the full amount is due within 30 days. An accounting presentation showing how much of the cash generated by a business remains after both expenses (including interest) and principal repayment on loans are paid. A projected cash flow statement indicates whether the business will have cash to pay its expenses, loans, and make a profit. Cash flows can be calculated for any given period of time, normally done on a monthly basis or yearly basis. The number of copies that a publication distributes or sells. Also refers to the number of people who have an opportunity to observe a piece of outdoor advertising, such as a billboard or poster. Something of value pledged to support the repayment of an obligation or loan. Examples include real estate and certificates of deposit. A legal document covering the item(s) pledged as collateral on a loan. The point during the sales process when the customer agrees to buy a product or service. Actions and procedures required to effect the successful conclusion of a business transaction, such as a real estate purchase or loan consummation. An unscheduled contact, either on the phone or in person, between a seller and a prospective customer. One of the major Internet domains, usually representing for-profit business entities. Other major Internet domains include .net, .org, .gov, .info, .biz, and .edu. Law made by judges in individual cases, rather than by the legislature. Direct and indirect monetary and nonmonetary rewards given to employees based on the value of the job, their personal contributions and their performance. The settlement of a dispute or claim. The inducement to a contract. Some right, interest, profit, or benefit accruing to one party, or some forbearance, detriment, loss, or responsibility given, suffered, or undertaken by the other. A common legal fee arrangement that relies on the collection of monetary damages for the plaintiff before any legal fees are owed. Most common in litigation (such as in personal injury lawsuits), it allows the client to receive legal services while paying the attorney little or no money up front. A potential obligation that may be incurred dependent upon the occurrence of a future event. Two examples are: (1) the liability of a guarantor of a promissory note if the primary borrower fails to pay as agreed and (2) the liability that would be incurred if a pending lawsuit is resolved in the other party’s favor. Publications, generally business oriented, delivered only to readers who have some special qualifications. Generally, these publications are free to the qualified recipients, who must complete registration questionnaires in order to receive them. Also called “qualified circulation.” A string of text sent by a web server that a browser stores in a small text file on the user´s hard drive. Cookies store information supplied by the user and read it back later to keep track of user behavior. An exclusive ownership interest in an artistic or literary work. The term “literary work” includes computer software and other information stored in electronic form. Copyright is often noted by the following example: “Copyright© 2003 by AllBusiness.com.” Corporation. A form of organization that provides its owners and shareholders with certain rights and privileges, including protection from personal liability, if proper steps are followed. Corporations may take a number of forms, depending on the goals and objectives of the founders. Types include C, S and nonprofit corporations. Corporations are regarded as “persons” in the eyes of the law and may thus sue and be sued, own property, borrow money and hire employees. Cost of Goods Sold. This term represents the cost of buying raw materials and producing the goods that a company sells. It also includes the cost of the company´s labor force and overhead costs. CPU (Central Processing Unit). The main microprocessor chip in a computer. Also used to describe the whole computer “box,” apart from the display screen, keyboard, mouse or other external devices. Crash. A hardware or software problem that causes an application to quit working. Some crashes render the entire computer unusable, requiring the user to reset or restart the machine. Credit Rating. A formal evaluation of an individual or a company´s credit history and capability of repaying debt. Credit Score. A statistical summary of the individual pieces of information on a credit report. A credit score predicts how likely it is that a company or individual will repay debts. Lenders use credit scores to determine whether to extend credit and at what interest rate. Also called a risk score. Current Ratio. The ratio of the company´s current assets to its current liabilities. A current ratio of less than 1-to-1 typically indicates a poor credit risk. A current ratio of greater than 2-to-1 typically indicates a good credit risk. Customer. Someone who has bought or made the decision to buy a product or service. Cyclical Industry. An industry that has natural high and low sales periods based on the time of year, season or other factors. C Corporation. A corporation where the entity is taxed separately from its owners under subchapter C of the Internal Revenue Code. Damages. A cash compensation ordered by a court or arbitrator to offset losses or suffering caused by another´s fault or negligence. Damages are a typical request made of a court or arbitrator when persons sue for breach of contract or tort. Database. A computer program that helps users organize information. Databases range from simple collections of rows and columns (similar to a spreadsheet) to complex systems that process and manipulate millions of records in a variety of ways. Debenture. Debt instrument evidencing the holder’s right to receive interest and principal installments from the debtor. Debt Financing. The provision of long term loans to small business concerns in exchange for debt securities or a note. Decision Maker. The person within a company who ultimately decides which products or services to buy. Deed of Trust. A document that, when properly delivered, transfers a security interest in real property. Defaults. The nonpayment of principal and/or interest on the due date as provided by the terms and conditions of a promissory note or loan agreement. Demand Letter. A letter from a lawyer on behalf of a client that demands payment or some other action. Demand letters often threaten litigation if the other party does not perform. Demographic. A descriptive classification for consumers, such as age, sex, income, education, household size, home ownership or other defining characteristics. Depreciation. An accounting procedure that spreads the cost of purchasing an asset over the useful lifetime of the asset. DHTML (Dynamic Hypertext Markup Language). Dynamic HTML is an umbrella term used to include HTML and related technologies such as Cascading Style Sheets (CSS) and JavaScript that bring animation and other interactivity to Web pages. Digital Certificate. A special email attachment that confirms the identity of the person sending the message. Direct Mail. Marketing or advertising materials sent directly to a prospective customer via the US Postal Service or a private delivery company. Direct Marketing. The process of sending promotional messages directly to individual consumers, rather than via a mass medium. Includes methods such as direct mail and telemarketing. Disability Benefits. Benefits paid to an employee who cannot work because of disability, usually limited to what is not covered by workers compensation. Disability benefits are usually a percentage of the employee´s prior income and generally run for a limited time. Doing Business As (DBA). A situation in which a business owner operates a company under a different name than the one under which it is incorporated. The owner typically must file a fictitious name statement or similar document with the appropriate county or state agency. Domain Name. The text-based URL or address of a Web site. Domain names usually consist of several different segments. The name www.allbusiness.com, for example, includes the generic “www” and “.com” identifiers, along with the unique name “allbusiness.” DSL (Digital Subscriber Line). A family of telecommunications protocols designed to allow data communications over standard telephone lines at speeds up to 1.5Mbps — about 30 times faster than a standard 56K modem. DSL service lets users receive voice and data transmissions simultaneously over the same phone line, allowing “always on” Internet access. EBITDA. Earnings before interest, taxes, depreciation, and amortization. E-Check. A method of automatically paying for goods or services that works much like direct deposit in reverse. Companies keep a customer´s voided check on file, which allows them to debit the customer´s bank account for the amount owed. EDI Electronic Data Interchange). The exchange of standardized document forms between computers for business use. EDI has traditionally been a very complex and expensive undertaking. As more companies build inexpensive, standards-based networks around the Internet, however, EDI systems are becoming cheaper and easier to use. Embossing. To raise a design or letters already printed on a card. Employee Retirement Income Security Act (ERISA). A broad-reaching law that establishes the rights of pension plan participants, standards for the investment of pension plan assets, and requirements for the disclosure of plan provisions and funding. Employee Manual. A handbook that describes a company´s personnel procedures, policies and benefits. Employer ID Number (EIN). An identification number assigned to businesses for taxpaying purposes by the IRS or state taxing authorities. An Employer ID Number is required for partnerships, corporations, and trusts, and it may be required for sole proprietorships that have employees. Also called a Federal ID Number or Taxpayer ID Number. Employment Agreement. An agreement that sets forth the rights and obligations of employees and employers. Typical employment agreements oblige employees to keep trade secrets confidential and to not solicit other employees after their departure. Encryption. The translation of plain-text data, such as an email message, into an unreadable code in order to ensure its safe transmission over the Internet. To read encrypted data, you must have software that allows you to decrypt it. Entrepreneur. One who assumes the financial risk of the initiation, operation, and management of a given business undertaking. Equal Employment Opportunity (EEO). Federal legislation prohibiting employment discrimination based on age, race, sex, religion or ethnic background. Equal Employment Opportunity Commission (EEOC). The federal agency responsible for handling workplace discrimination complaints. Many states have comparable agencies. Equal Pay Act. Federal legislation that prohibits certain employers from paying different wages to men and women who perform the same work in similar working conditions. Equity. An ownership interest in a business. For example, stock in a corporation represents equity in the corporation. Equity Financing. The provision of funds for capital or operating expenses in exchange for capital stock, stock purchase warrants, and/or options in the business financed, without any guaranteed return, but with the opportunity to share in the company’s profits. Ergonomic. Machines and equipment, such as computers, chairs, and lighting, designed to reduce injuries and increase productivity. ESOP (Employee Stock Ownership Plan). A retirement-type plan in which a trust holds stock in the employees´ names. Employees receive cash from the stock only when they leave the company or perhaps when the company is sold. Ethernet. The most common method for transferring data over a Local Area Network (LAN). Exempt Employee. Employees who are not bound to overtime regulations and minimum wage laws. Who is exempt depends on level of responsibility or professional status. Exit Interview. An interview conducted at the end of an employee´s term of employment to obtain employment feedback and to remind the employee of his or her confidentiality obligations. Extranet. An intranet that is open to certain external users, such as suppliers and clients. These external users may log onto an extranet in a one-way relationship or they may connect their own intranet with the host intranet, creating a two-way relationship. 401(k) Plan. A tax-deferred retirement plan designed to encourage long-term retirement savings. Some companies provide contributions as an employee benefit. FAQs. Frequently Asked Questions (FAQs) Fair Debt Collection Practices Act. A federal law that specifies what debt collectors can and cannot do to try to collect late payments. Fair Labor Standards Act (FLSA). A federal law that defines the 40-hour workweek, the federal minimum wage, overtime pay, record keeping and child labor standards affecting private sector, federal, state and local government workers. Fair Use. A legal doctrine that authorizes use of copyrighted materials for certain purposes without the copyright owner´s permission. Family and Medical Leave Act (FMLA). A federal law requiring employers to provide eligible employees with unpaid leave during a year´s time for the birth or adoption of a child, family health needs or personal illness. The FMLA generally applies to all public agencies, including state, local and federal employers; private companies that employ 50 or more people; and public schools. Fiber Optics. A technology that transmits data as beams of light along tiny strands of glass. Fiber-optic networks can transmit a greater amount of data than other kinds of networks, and they are much less likely to introduce data errors. FICA (Federal Insurance Contributions Act). A payroll deduction for Social Security required by the federal government. Financial Reports. Reports concerning the financial aspects of a business, such as:
Financing. New funds provided to a business, either by way of equity infusion, or loans. Firewall. Software that protects a private network, such as a LAN or an intranet, from intruders or unauthorized traffic. Firewall software usually screens traffic by IP address or other traits, admitting certain types of traffic while blocking others. Fixed Costs. Costs of doing business, such as rent and utilities that remain generally the same regardless of the amount of sales of goods or services. Flow Chart. A graphical representation for the definition, analysis, or solution of a problem, in which symbols are used to represent operations, data, flow, equipment, etc. Foot Traffic. Consumer activity produced by visitors at stores, trade show exhibits or by popular retail locations. Foreclosure. The act by the mortgagee or trustee upon default, in the payment of interest or principal of a mortgage of enforcing payment of the debt by selling the underlying secured property. Form W4, Employee’s Withholding Allowance Certificate. An IRS form completed by the employee and used by the employer to determine the amount of income tax to withhold. Franchising. A relationship in which the franchisor provides a licensed privilege to the franchise to do business and offers assistance in organizing, training, merchandising, marketing, and managing in return for a consideration. Examples of franchises include Burger King and Taco Bell. Freedom of Information Act. The FOIA, enacted in 1966, generally provides that any person has a right of access to federal agency records. Freeware. Software that is available for anyone to use, free of charge. Most freeware is still copyrighted, however, which means that it can´t be further distributed or licensed. FTP (File Transfer Protocol). The most common way to download and upload files over the Internet, FTP operations require special software that is built into the most popular Web browsers and that is also available in a number of stand-alone applications. Web site builders use FTP to upload files to a Web host computer. Full-Service Agency. A firm that handles all aspects of the advertising or public relations process, including planning, design, production and placement. Many full-service agencies also handle marketing communication, public relations, sales promotion and direct marketing. GIF (Graphics Interchange Format). One of the two most common graphics formats on the Web. (JPEG is the other.) GIF images are used mostly for line art, logos and similar types of graphics. Giveaway. A gift given to potential customers at trade shows and other marketing events to remind them of a product or service. Also known as a “freebie” or a “gimme.” Guarantee. A promise to step in and perform another´s obligation if that person should fail or default. Guarantor. A person who makes a legally binding promise either to pay another person´s obligation or to perform another person´s duty if that person defaults or fails to perform. Hard Sell. Aggressive, high-pressure sales techniques. Health Maintenance Organization (HMO). A system of managed health care in which patients must see approved health care providers. HMOs typically offer coverage with no deductibles and low per-visit fees. HTML (Hypertext Markup Language). One of the foundations of the Web, HTML is a text-based language used to describe the structure and layout of a document — headlines, paragraphs, table elements and so on. HTTP (Hypertext Transfer Protocol). The set of standards that lets Web servers and browsers communicate with each other. HVAC. Acronym that stands for heating, ventilation and air conditioning. Hyperlink (link). Web developers use HTML to create hyperlinks that a user clicks on to be transported to another Web page. Hyperlinks can appear as graphics or as areas of differently colored or underlined text. Incentive Stock Options (ISOs). Stock options granted to employees that are taxed as capital gains rather than income if the employee meets the required holding period before selling them. Also called statutory stock options and qualified stock options. Income Statement. A record of the financial performance of a company over a period of time. It records all the income generated by the business during the period and deducts all its expenses for the same period to arrive at net income, or the profit for the period. Independent Contractor. A worker who works on a specific project for a specified period of time. Independent contractors are not subject to tax withholdings and usually don´t receive benefits granted to full-time employees. Infringement (of copyright). Any unauthorized use of a copyrighted work other than fair use. Infringement (of patent). Violation of a patent through production, use or sale of a patented invention or its functional equivalent without the patent holder´s permission. Infringement (of trademark). Unauthorized use of a protected trademark or service mark or use of a confusingly similar mark. Inquiries. Consumer response to a company´s advertising, or to other promotional activities such as coupons. Used to measure the effectiveness of promotions. Inserts. Extra printed pages inserted loosely into printed pieces. Often inserts are advertising supplements to a newspaper or magazine. Internal Revenue Service (IRS). The federal agency that collects income taxes in the United States. INS Form I-9. The form used by the Immigration and Naturalization Service to verify an employee´s eligibility to work in the United States. Insolvency. The inability of a borrower to meet financial obligations as they mature, or having insufficient assets to pay legal debts. Interest. (1) An amount paid a lender for the use of funds, or (2) cost of using credit or another person´s or company´s money. Interest is usually calculated as a rate per a period of time, typically a year. Interest Rate. Percentage of a sum of money charged for the use of the money. Borrowing $100 for one year at a 10 percent simple interest rate would cost $10. Internet. A network of networks, built upon a set of widely used software protocols that links millions of computers around the world. Services such as email and the Web use the Internet to transfer data. Intranet. A private corporate network built with Internet-based protocols and software applications. Invoice. A bill prepared by the seller of goods or services. Invoices tell purchasers how much they owe. IP Address. A numeric address devices use to find one another on the network and to exchange information. Every device connected to the Internet has an identifying IP address. Most Internet users never see an IP address; instead, they use text-based domain names, which are easier to remember. IRS Form 1099-MISC. The tax form sent to the IRS and the independent contractor at the end of the year when an independent contractor´s annual wages meet or exceed $600. IRS Form W-4. The IRS form used to record filing status and withholding allowances. Also known as the Employee Withholding Tax Certificate. ISDN (Integrated Services Digital Network). A set of communications standards that enable a single wire to carry data, voice and video transmissions at the same time. ISDN uses existing analog phone lines to provide faster Internet access (up to 128Kbps, or twice as fast as a 56K modem). ISP (Internet Service Provider). Companies that provide access to the Internet, either via dial-up access numbers or a dedicated service such as DSL. Many ISPs also offer Web hosting, domain name registration and other services. There are thousands of ISPs, ranging in size from tiny local providers to giant corporations such as America Online. Java. A programming language created by Sun Microsystems. Java offers a number of advantages for Internet developers and users: The same Java program can run on many different operating systems, and Java offers built-in security features that make it safer for computer users to download unfamiliar applications. JavaScript. Unrelated to Java, JavaScript is a relatively simple text-based scripting language that can be embedded in HTML documents. JavaScript lets developers add special effects to Web pages. Joint Venture. An agreement between two or more partners (”joint venturers”) to pursue collaboratively a particular project or business, with a sharing of profits or losses. JPEG (Joint Photographic Experts Group). One of the two most common image types used on the Web (GIF is the other). JPEG is used mostly for photographic reproductions. Also referred to as jpg. Judgment. Judicial determination of the existence of an indebtedness or other legal liability. Judgment by Confession. The act of debtors permitting judgment to be entered against them for a given sum with a statement to that effect, without the institution of legal proceedings. Jurisdiction. The authority of a court to hear and decide a case. For a decision to be valid, a court must have both “subject matter jurisdiction” (the ability to hear the type of case at issue) and “personal jurisdiction” (authority over the parties). Kbps (Thousands of Bits Per Second). A measurement of data transfer rates. Kilobit. One thousand bits. Abbreviated as Kb. LAN (Local Area Network). A geographically limited communications network linking computers, printers and other devices. Ethernet is the most common means of creating a LAN. Lanham Act. The main federal statute governing trademarks, service marks and unfair competition. It seeks to prevent deceptive and unfair competitive practices in the marketplace. Many states have similar laws. LCD (Liquid Crystal Display). A display technology that uses rod-shaped crystals that flow like liquid and bend light when energy flows through them. LCD technology is used in laptop computer and flat-panel displays. Lead. A new prospect or client previously unknown to a salesperson or company. Lease. A contract by which a tenant (the “lessee”) takes possession of office space, furniture, equipment or other property for a specified rent and specified amount of time. At the end of a lease, the property reverts back to its owner (the “lessor”). Lessor. The landlord or owner. Letter of Credit. A document issued by a bank guaranteeing payment of a customer´s debt up to a set amount over a set period of time. Letters of credit are used extensively in international trade. Letter of Intent (LOI). An agreement, usually nonbinding, documenting the general terms of a proposed business relationship. Often used as a prelude to a binding, definitive agreement. Liability. Any debt or obligation due now or potentially in the future. Liability is synonymous with legal responsibility. Lien. A charge upon or security interest in real or personal property maintained to ensure the satisfaction of a debt or duty ordinarily arising by operation of law. Limited Liability Company (LLC). A flexible business structure, popular with small businesses, offering owners the advantage of limited personal liability and the choice of being taxed like a partnership or a corporation. Limited Liability Partnership (LLP). A type of partnership recognized in many states that protects individual partners from personal liability for negligent acts committed by other partners and employees not under their direct control. Some states restrict this type of partnership to professionals, such as lawyers, accountants and architects. List Broker. A person or company who prepares, rents and maintains mailing lists. Litigation. Lawsuits instituted through the judicial process. Loan Agreement. An agreement for the borrowing of money, typically containing pertinent terms, conditions, covenants and restrictions. Logo. A symbol that a company uses to represent itself or its brand. Long-Term Debt. Obligations or liabilities that a company owes in one year or more. Mailing List. Names, addresses and sometimes phone numbers of consumers or businesses aggregated by buying characteristics such as age, income, education, size of household or business and ownership of property. Mailing lists are used for direct mail and to generate sales leads. Marketing Plan. A company plan for marketing products and services and increasing sales. Market Share. The percentage of a product category´s sales, in dollars or units, that a particular brand, product line or company controls. Marketing Communications. The process and techniques involved in marketing, promoting or selling products or services through creative, visual or written communications. Also known as “marcom.” Maturity. In general, the period and date when payment of a loan is due. As applied to securities and commercial paper, the period and date when payment of principal is due. Maturity Extension. Extension of payment beyond the original date established for repayment of a loan. Mediation. A form of alternative dispute resolution in which a neutral party (a mediator) seeks to promote and negotiate a settlement between opposing parties in a dispute. There is no mechanism to compel the parties to settle; they must voluntarily agree to any settlement. Medium. A type of publication or communications method that conveys news, entertainment and advertising to an audience. Examples include newspapers, television, magazines, radio, billboards and the Internet. Merger. Typically, a combination of two or more corporations into one corporation. Mortgage. An instrument giving legal title to secure the repayment of a loan made by the mortgagee (lender). MP-3 (MPEG Third Layer). A popular audio file format. Files encoded in MP-3 compress data at a 10:1 ratio, making it suitable for sending large, high-quality audio files over the Internet. MPEG (Moving Pictures Experts Group). A common file format for sending audio and/or video over the Internet. Multimedia. Information that combines different types of content, such as text, images, animation, video and audio. Negligence. An action or omission falling below the standard of care that a reasonable person would exercise in the same situation. Netiquette. A code of conduct that governs behavior on the Internet. Netiquette, for example, requires Internet users not to send unsolicited commercial email, or “spam,” to large numbers of other users. Many Internet Service Providers and discussion groups will ban users who consistently violate these rules. Nondisclosure Agreement (NDA). A contract in which a person or business agrees to maintain the confidentiality of proprietary information or trade secrets and not disclose such information without authorization. Employees, consultants, business partners and investors are often asked to sign nondisclosure agreements. Nonexempt Employee. Employees who are protected by wage laws that mandate payment for every hour of overtime worked. Nonprofit Corporation. A form of corporation in which no stockholder or trustee shares in profits or losses and which usually exists to accomplish some charitable or educational function. These organizations are exempt from corporate income taxes, and donations to these groups may be tax deductible. Nonqualified Stock Options (NSOs). Nonqualified stock options may be granted to employees, consultants, contractors and others. When nonqualified stock options are exercised the holder must pay ordinary income tax on them, even if the shares have not yet been sold. Notes Receivable. A secured or unsecured receivable evidenced by a note. Numeric Messaging/Paging. A service that lets a pager receive pages and messages containing numeric information. Occupational Safety and Health Administration (OSHA). A federal organization established to promote healthy and safe work environments. OSHA requires employers to inform employees of potential hazards, provide safety training and report workplace injuries. Many individual states have similar agencies. OCR (Optical Character Recognition). Software that lets computers “read” printed documents input via a scanner and converts the image into a computer text file that users can edit. OEM (Original Equipment Manufacturer). A company that produces the equipment that bears another company´s label. Operating Expenses. In real estate, the costs of maintaining a property, such as utility charges and property taxes. Overnight Delivery. A service promising delivery of packages by a designated time of the next business day. Overrun. A quantity of printed material or other manufactured product that exceeds the amount ordered. Pager. A pocket-sized radio receiver used to receive callers´ phone numbers or short messages. Pagers emit an audible signal or vibrate (or both) when they are triggered. Parallel Port. An interface on a computer used for connecting printers and other devices. Most personal computers have at least one parallel port along with a serial port and special ports for a mouse and keyboard. Parent Company. A company that owns a majority stake (51 percent or more) of another company´s shares. It may have its own operations, or it may have been set up solely for the purpose of owning the operating company. Partnership. A legal relationship existing between two or more persons or entitites contractually associated as joint principals in a business. Patch. An interim update to a computer program that fixes a particular problem. Patent. A patent secures to an inventor the exclusive right to make, use and sell an invention for a designated period of time. See information at www.uspto.gov. Pay Period. The frequency with which payroll is processed and paychecks are issued. PDA (Personal Digital Assistant). A class of small, highly portable computers, such as 3Com´s Palm Pilot. PDAs are typically used to store contact information, to access email and the Web and to run other business-related applications. PDF (Portable Document Format). Adobe Systems´ PDF file format delivers print-quality documents in downloadable form. Although PDF is a proprietary format, it is the de facto standard for delivering documents in which formatting is essential, such as business forms and schematics. Peak Period. In wireless telephones, the high-use period of the business day when wireless service providers charge their highest rates, typically 7 a.m. to 7 p.m. Performance Review. A mechanism for regular discussion and evaluation of an employee´s job performance. Peripheral. Any hardware device, such as a modem, printer or mouse that operates separately from a computer´s CPU. Plug and Play. A Microsoft/Intel standard that lets users install new components into their computer system and begin using them immediately. In order for Plug and Play to work, both the computer and the peripheral device must support the standard. Point-of-Purchase (POP) Display. Advertising material located in a retail store, usually placed near the checkout counter. Port. A connection for sending data into or out of a personal computer. Most printers, for example, plug into a computer´s parallel port. Also used to denote an address reserved for a particular use on an Internet server. Power of Attorney. A written authorization that lets one person act as an agent for another and to make binding decisions for the principal. A power of attorney can be limited to specific types of decisions or it can be general. PPP (Point-to-Point Protocol). A set of standards that lets computers connect to the Internet through a telephone connection. Most dial-up Internet connections are now based on PPP instead of the older, less reliable SLIP protocol. Preferred Stock. A class of stock with a liquidation preference before payment is made to the common stock holders. Preferred stock is the security most used by venture capital investors. Press Kit. A collection of publicity materials, including press releases and general company information, that is packaged and sent to media organizations. Press Release. A document that communicates information to the press. Press releases can publicize good news such as positive earnings and new product or service launches. Prime Rate Interest rate which is charged business borrowers having the highest credit ratings, for short term borrowing. Privacy Policy - Internet. The policy established by a Web site regarding the use of information obtained from users or viewers of the Web site. Profit Sharing. Employee incentives in which a company distributes or receives a portion of the business´s profits to employees. Promotion. Forms of communication that call attention to products and services, typically by adding extra value to the purchase. Includes temporary discounts, allowances, premium offers, coupons, contests and rebates. Proprietorship. The most common legal form of business ownership; about 85 percent of all small businesses are proprietorships. The liability of the owner is unlimited in this form of ownership. Prospect. A prospective customer who has the capacity to buy a product or service, but who has not yet decided to do so. Prospecting. The process by which salespeople determine whether or not a business or an individual could qualify as a potential customer. Proxy. A right given to an agent, most often in the context of shareholder voting in corporations. Public Domain. A copyright term that means a particular work is free for all to use without permission. Works in the public domain include those that were never copyrighted, those for which the copyright has expired and public documents. Public-Key Encryption. This popular form of Internet-based encryption includes two elements: a public key and a private key. An individual creates a public key and sends it to people with whom they exchange email. Recipients then use this public key to create coded messages for the sender. When someone receives a message encrypted with their public key, they use a secret private key to decode the message. Publicity. Information with news value used to promote a product, service or idea in the media. Public Relations. Communication with various sectors of the public to influence their attitudes and opinions in the interest of promoting a person, product or idea. Purchase Order. A form that contains pricing, quantity and other purchasing information. Qualify. The information-gathering process that salespeople use to determine a prospect´s buying potential. RAM (Random Access Memory). Chips in a computer that store frequently used information, allowing the CPU to access it quickly. But data stored in RAM is erased when the computer is turned off. RAM is usually measured in megabytes of storage capacity. Rentable Square Feet. The total square feet available for lease. Typically, when landlords quote a price per square foot, they are talking about rentable square feet. Return on Investment. The amount of profit (return) based on the amount of resources (funds) used to produce it. Also, the ability of a given investment to earn a return for its use. Resale Carrier. A company that buys telephony services in bulk and sells them to others at a markup. Retainer. A contract between a lawyer and a client in which the lawyer agrees to provide certain legal services for money. The agreement formalizes the lawyer-client relationship and explains the relative duties of lawyer and client toward one another. Right of First Offer. The right to be the first person offered a particular item (such as stock or real estate). Right of First Refusal. The right to be the first person allowed to purchase a certain item (such as stock or real estate) if it is ever offered for sale. Roaming. Using a wireless phone outside the home service area defined by the service provider. Roaming often incurs higher per-minute rates as well as daily access fees and long distance charges. ROM (Read-only Memory). Memory chips that permanently store data. A hardware or software vendor usually programs a computer´s ROM. The software necessary for a computer to start, including the BIOS, is usually stored in ROM. SBA. The US Small Business Administration (SBA), created by Congress in 1953 to help America’s entrepreneurs form successful small business enterprises. See www.SBA.gov. Salary. Regular compensation paid to an employee as a condition of employment. Salary is generally computed on an annual or a monthly basis. Sales Tax. A tax on retail products based on a set percentage of retail cost. Sarbanes-Oxley Act. A comprehensive federal law aimed at corporate governance and fraudulent financial transactions. Search Engine. Software that indexes Web pages and allows users to search for particular keywords. Public search engines such as Lycos, AltaVista and Google constantly index Web sites and add information about these sites to their databases. Many individual Web sites also use their own built-in search engines. Second-Day Delivery. A service that promises to deliver packages by the end of the second day after the package was sent. Security Deposit. Money that a lessee must give a lessor as a guarantee that the lessee will make payments. Self-Mailer. A direct mail piece, such as a postcard, that does not require an envelope or wrapper for mailing. Server. A computer on a network that offers shared hardware or software resources to multiple users. The term may apply in a general sense to a computer that “serves” shared files or applications over a LAN, or it may apply to a computer running a specific application, such as a Web server or mail server. SET (Secure Electronic Transactions). A standard for transmitting credit card data securely over the Internet, SET uses a series of digital certificate exchanges to verify the identities of consumers, merchants and banks. Although most major e-commerce players endorse SET, the standard´s cost and complexity have hindered its progress. For now, the simpler SSL standard secures most e-commerce transactions. Sexual Harassment. Uninvited sexual advances or related conduct that creates an intimidating, hostile or offensive work environment. Sexual harassment is prohibited by the federal Civil Rights Act of 1991 as well as by various state laws. Shareholder Agreement. A written agreement between a corporation and its shareholders governing the nature of the relationship and the conduct of certain corporate activities (such as distribution of profits and resolution of shareholder disputes). Shareware. Software that anyone may download for free and pass along to others. The creators of shareware programs usually ask users to pay a small fee if they use the product after a specified period of time. Silent Ringer. A phone or battery pack that signals incoming calls by vibrating or flashing a light. Sister Company. Sister companies share the same parent company or individual owner. Like a subsidiary, a sister company is typically a separately incorporated business. Small Claims Court. A court intended to simplify and expedite the resolution of minor disputes (such as disputes involving $5000 or less). Social Security Tax. Provides benefits for retired workers and their dependents as well as for the disabled and their dependents. Also known as “Federal Insurance Contributions Act” (FICA) tax. Soft Sell. The technique of using low-pressure appeals in sales. Spam. Slang term for unsolicited commercial email. “Spamming” people with unwanted commercial email solicitations is considered unethical and it is now illegal in several US states. Most ISPs will terminate a user´s account if they use it to send spam. SSL (Secure Socket Layer). Netscape Communications developed this protocol for transmitting credit card numbers and other sensitive data over the Internet. Both Netscape Communicator and Microsoft Internet Explorer support SSL, which is one of the most widely used e-commerce security methods (the other is SHTTP). Stock Option. A right to buy a given amount of company stock at a given price for a given period of time. Streaming Media. Streaming technology lets users play audio or video files as they download, rather than waiting for the whole file. Popular streaming media platforms include QuickTime, RealPlayer and Windows Media Player. Sublease. The act of a tenant leasing the property it is leasing to yet another tenant, called a sublessee. Subsidiary. A company owned by a parent company, a subsidiary is a separate legal entity listed as a corporation or LLC that is required to file its own taxes. Systems Integrator. An individual or a company that specializes in making different software and hardware systems work together. Systems integrators often specialize in particular applications, such as accounting, enterprise resource planning or Web and Internet systems. System Board. A printed circuit board in a personal computer that contains the main processor, expansion slots and other basic hardware. Also known as a motherboard. S Corporation. A form of corporate organization where the profits of the entity pass through to shareholders and are taxed on their personal returns under subchapter S of the Internal Revenue Code. T-1. A type of high-speed Internet connection that carries data at more than 1.5Mbps. An even faster version, called T-3, operates at speeds up to 44Mbps. Target Market. A specified audience or demographic group that an ad, product or service is intended to reach. TCP/IP (Transmission Control Protocol/Internet Protocol). These two communications protocols form the foundation of the Internet, allowing any two computers that support TCP/IP to communicate with one another. Tax Credit. A dollar-for-dollar reduction in the tax. Can be deducted directly from taxes owed. Tax Deduction. A part of a person’s or business‘ expenses that reduces income subject to tax. Teleconferencing. A meeting conducted by telephone among people in different locations. Telemarketing. Using the telephone to sell, promote or solicit products and services. Telephony. A catchall word describing the world of communications — from wireless phones to digital computer communications to voicemail systems. Telnet. An Internet-based protocol for connecting to a remote host or server. Telnet was once the main way to access other computers over the Internet, and it supported a variety of text-based email, file transfer, chat and information retrieval programs. Temporary Employee. An employee, often hired and paid by a third party, who fills in staffing shortages caused by special projects, seasonal coverage, leaves of absence or other reasons. Tenant Improvements. Refurbishing a rental space for a new tenant. Improvements may include repainting, recarpeting and moving walls. In high-vacancy markets, landlords often entice tenants with money for tenant improvements. In tight rental markets, tenants may be on their own. Tort. A civil wrong or injury that results in a legal action for damages to rectify the wrong. Tracking. Overnight shipping companies typically enable their customers to find out when a package was picked up, when it passed through certain regional shipping centers and airports, and when it was delivered. Tracking information is available either through toll-free phone numbers or Web sites. Trademark. A name, phrase, logo, image or combination of images used to identify and distinguish a business from others in the marketplace. The term is often used to include service marks, which apply to businesses providing services as opposed to selling products. Trademarks can be either registered or unregistered, with different levels of protection. Trojan Horse. A program that appears to serve a legitimate purpose but actually performs a destructive or unauthorized activity. Trojan horses differ from viruses mainly in that they do not replicate themselves. Trustee. A person or legal entity that holds money or property for the benefit of another. The owner of the money or property is known as the beneficiary. In most cases, the trustee and the beneficiary can be the same person. Two-Way Paging. A feature of some pagers that lets users transmit confirmation that a message has been received. Unemployment Compensation. Money paid to eligible people who have lost a job and are actively looking for work. Unemployment compensation is partially paid by the employer´s unemployment insurance contributions. Unfair Competition. A broad term describing illegal commercial activity ranging from trademark infringement to false advertising. Federal and state laws regulate unfair competition, and the remedies available range from money damages to court injunctions. Unix. A computer operating system used mostly in high-end workstations and servers. A number of companies produce not completely compatible varieties of UNIX The well-known “open source” Linux operating system is a variety of UNIX Unsecured Debt. A debt that is not guaranteed by a specific piece of real or personal property. If the debtor defaults, the creditor does not have the right to seize specific property to satisfy the debt. Upsell. A technique to increase the value or quantity of a sale by suggesting additional options or upgrades. For example, a fast-food restaurant may upsell by suggesting that a customer buy a larger drink or an order of French fries. URL (Uniform Resource Locator). The text address that allows users to find a particular Web site or Web page. The links on Web pages also consist of URLs, which are embedded in the HTML code on the page. URLs comprise of a domain name followed by the file path to a particular file on that domain´s Web server. Usable Square Feet. The amount of space renters can actually use. Usable square footage is usually less than rentable square footage because it deducts common areas such as public corridors, elevators, lobbies and bathrooms. Usenet. An Internet service that provides thousands of discussion lists, or newsgroups, on a variety of topics. Users can read newsgroup postings or they can add their own. Most newsgroups are completely open, although some are moderated. You can view Usenet newsgroups with special software built into browsers and email programs or via one of several Web-based services. VAR (Value Added Reseller). A company that modifies or improves a system in some way and then resells it. A VAR might, for example, integrate a software application with its clients´ other systems or it might buy hardware components and build complete systems. Venture Capital. Money used to support new or unusual commercial undertakings; equity, risk or speculative capital. This funding is provided to new or existing firms that exhibit above-average growth rates, a significant potential for market expansion and the need for additional financing for business maintenance or expansion. Venture Capital Limited Partnership. Investment vehicles organized to raise capital for start-up companies or those in the early process of developing products or services. The limited partners invest in the limited partnership to provide investment capital. Vicarious Liability. When a person is held legally responsible for the actions of another even though that person did not directly cause the harm. For example, employers are sometimes held vicariously liable for the damages caused by their employees. Virus. A self-replicating computer program that infects a PC without the user´s knowledge or permission. Most viruses are harmless, although some are very destructive. Voicemail. An automated service that answers phone calls and records incoming messages. Enhanced voicemail services add features such as personalized greetings, longer recording times and more saved messages. WAN (Wide Area Network). A communications network that covers a large geographic area, a WAN may be a public network such as the Internet or it may be a closed, proprietary network run by a corporation or government agency. Warranty. A guarantee about the performance of a product, or a promise to perform a specific act, such as repairing or replacing a defective or broken product. Web Browser. A program that allows an individual to view Web pages. Web Host. A service that operates Web servers for its clients and publishes their Web sites. Web Page. A page in a Web document. Unlike printed pages, a Web page may be just a few words long or it may include thousands of words, images and other content. Web Server. A computer that publishes a Web site on the Internet. It usually includes the Web server software, the appropriate software protocols such as TCP/IP, the Web site content and occasionally other software such as e-commerce or database applications. When the Web server receives a request from a Web client (or browser), it delivers the appropriate page or performs the requested task. Wi-Fi. Shorthand for “wireless fidelity,” this is a high-frequency wireless local area network. Wi-Fi can be used to connect to the internet wirelesly. Workers´ Compensation Insurance. Government-mandated insurance that covers a business´ financial obligations for its employees´ work-related injuries. Workgroup. Two or more networked computers that share files or other resources. A large network may consist of several smaller workgroups, each having different levels of access to various types of data. Working Capital. The difference between current assets and current liabilities. Working capital finances the cash conversion cycle of a business — the time it takes to convert raw materials to finished products to sell and receive cash. Workstation. Once applied to high-powered computers used for graphics processing, scientific applications or similar uses, this term is now increasingly used to describe ordinary PCs connected to a network. World Wide Web (WWW). An Internet service that links collections of documents, or Web sites, both internally and to other sites. In addition to formatted text, Web pages may include graphics, audio, video and other multimedia content. Worm. Small, usually destructive programs that replicate themselves on a computer´s memory or hard disk, often until the computer crashes or becomes unusable. WYSIWYG (What You See is What you Get). Used to describe any computer program that displays content as it will appear in its finished form. Many applications promise WYSIWYG features, but differences in output devices and screen displays make it nearly impossible to meet this goal all of the time. |
Search
Business Specific Management Solutions
Categories
- Accounting (1)
- Announcements (2)
- Business Software (1)
- Customers (11)
- E-Commerce (1)
- General Business (24)
- Inventory (2)
- On the Lighter Side (9)
- Point Of Sale (2)
- Sales (2)
- System Five Software (1)
- Technology (2)