1.1 Fundamentals and Principles of Buisness Flashcards
Key Term Revision (143 cards)
1
Q
Auditing
A
Independent examination of financial information to verify accuracy, compliance, and reliability.
2
Q
Banking Services
A
Financial services provided by banks, including deposit accounts, loans, and transactions.
3
Q
Borrowing
A
Obtaining funds from external sources with the agreement to repay, allowing companies and governments access to financial resources.
4
Q
Break-Even
A
The point at which a business’s revenue equals its expenses, covering costs and achieving a balanced financial state.
5
Q
Budgeting
A
The process of creating a detailed plan for the use of financial resources, setting targets and controlling expenses.
6
Q
Capital Depreciation
A
The reduction in the value of assets over time, impacting the company’s financial statements and profitability.
7
Q
Capital Market
A
Consists of primary and secondary markets for trading equity securities (stocks) and long-term debt securities (bonds) on a global scale.
8
Q
Cash Flow
A
The movement of money in and out of a business, indicating its ability to meet short-term financial obligations.
9
Q
Cash Flow Management
A
The monitoring and control of cash inflows and outflows to ensure a business has sufficient liquidity for its operations.
10
Q
Challenges
A
Difficulties or obstacles faced as a result of globalisation, including disruptions, risks, and the need for consistent reporting standards.
11
Q
Civic Duty
A
The responsibility of businesses to contribute to the economic and social well-being of society, including paying taxes and supporting government priorities.
12
Q
Commodities
A
Goods or raw materials bought and sold internationally, playing a significant role in global trading activities.
13
Q
Communication
A
The exchange of information and ideas between individuals or groups, a crucial factor driving globalisation.
14
Q
Competing Needs
A
Conflicting interests or demands of stakeholders that may require businesses to make trade-offs to satisfy different groups.
15
Q
Competitive Advantage
A
The unique qualities or strategies that allow a business to outperform its rivals and gain a stronger market position.
16
Q
Competitiveness
A
The ability of a business to outperform rivals and gain an edge in the market, often achieved through strategic positioning.
17
Q
Competitors
A
Other businesses operating in the same market or industry, influencing market trends, pricing, and product quality.
18
Q
Confidentiality
A
The protection of sensitive information from unauthorized disclosure, crucial in specific contexts such as contract negotiations and mergers.
19
Q
Conflicts
A
Disagreements or tensions arising from differing interests among stakeholders, requiring management intervention.
20
Q
Consumers
A
Individuals or entities that use goods and services to satisfy their needs and wants.
21
Q
Contract Negotiations
A
Discussions between parties to reach agreements on terms, conditions, and obligations, requiring confidentiality to protect business-related details.
22
Q
Cost Control
A
Managing expenses and resource utilization responsibly to ensure the sustainable use of public resources.
23
Q
Cost of Borrowing
A
The expense incurred by a company when borrowing funds, including interest and fees.
24
Q
Credit Cards
A
Payment cards that allow users to make purchases on credit, with the obligation to repay the borrowed amount.
25
Customer-Focused Approach
Business strategy prioritizing customer needs and satisfaction, considering factors like price, quality, and service.
26
Deposit Holders
Individuals or entities that deposit money in banks or financial institutions, entrusting them to safeguard funds.
27
Development
The ongoing effort to enhance the capabilities and career progression of employees within the organization.
28
Differentiation
The process of making a business or its products distinct from competitors to gain a competitive advantage.
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Differing Needs
Varied requirements and expectations of stakeholders based on their relationship with the business, leading to potential conflicts.
30
Distribution Channels
The pathways through which products or services are made available to customers, involving intermediaries like wholesalers and retailers.
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Diversification
Broadening the range of products or services offered by a business to mitigate risks and explore new opportunities.
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Diversify
Spreading investments across different assets or markets to reduce risk and enhance the potential for returns.
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Dividends
Payments to shareholders from company profits, often in the form of cash or additional shares.
34
Economic Development
The process of improving the economic well-being and quality of life for a community, region, or country.
35
Economic Security
The state of stability and resilience in a country's economy, achieved by addressing overseas competition and reducing dependence on imported goods.
36
Efficiency
Maximizing productivity, minimizing waste, and optimizing resource allocation to achieve operational effectiveness.
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Employment Opportunities
Job positions created by businesses, enabling individuals to earn a living and support personal and family needs.
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Entrepreneurship
The activity of identifying opportunities, innovating, and taking risks to create and manage a business venture.
39
External Stakeholders
Entities outside the business but with a significant influence on its success, including customers, suppliers, government, and the local community.
40
Factors of Production
Resources required for business operations, including labor, capital, raw materials, and entrepreneurship.
41
Finance
The management of money and other financial resources, involving activities such as lending, investing, and providing financial services.
42
Financial Advisers
Professionals who provide advice and guidance on financial matters, such as investments, retirement planning, and risk management.
43
Financial Context
The perspective that focuses on the financial aspects of business operations, including revenue, profit, and shareholder value.
44
Financial Health
The overall well-being and stability of a business or organization, assessed through financial indicators and reports.
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Financial Performance
The evaluation of a business's profitability, liquidity, solvency, and overall financial health.
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Financial Prudence
Sound financial management practices, including budgeting, monitoring, and control, to achieve business objectives.
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Financial Records
Systematic documentation of financial transactions and activities, ensuring accurate and transparent financial reporting.
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Financial Resources
Monetary assets, including funds available for investment, spending, or other financial activities.
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Financial Stability
The condition in which an individual, business, or economy has a stable financial situation without excessive debt or financial risk.
50
Financial Statements
Documents that present the financial performance and position of a business, including the balance sheet and income statement.
51
Fintech Disruption
The impact of financial technology innovations on traditional banking and financial services, leading to changes in the industry landscape.
52
Global Economy Markets
Various markets, including consumer, business (B2B), and government (B2G) markets, operating at both local and international levels.
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Global Market Fluctuations
Changes in the international market that can impact the stability of a country's economy, emphasizing the need for businesses to be resilient and self-sufficient.
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Global Scale
The ability of businesses to operate and reach consumers and partners on an international level, beyond national boundaries.
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Global Trading
Involves financial markets such as the global money market and the global capital market, facilitating currency exchange, short-term financing, and the trading of securities.
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Globalisation
The process of businesses expanding their operations and influence on a global scale, involving international markets and operations.
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Goods and Services
Products and offerings provided by businesses to fulfill the needs and wants of consumers.
58
Government
The governing body of a country, involved in international trade and financial transactions to meet economic and strategic goals.
59
Growth
The expansion of a business's operations, market share, or customer base, aiming for increased profitability.
60
Human Resources
The management of the workforce in a business, involving various aspects such as recruitment, remuneration, training, and labor relations.
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Incentives
Rewards or motivators offered to employees to encourage specific behaviors or achievements in the workplace.
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Inconsistencies
Lack of uniformity or discrepancies in financial reporting, highlighting the need for standardized reporting practices in a globalised context.
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Industrial Action
Collective activities taken by workers, such as strikes or protests, to influence workplace conditions and negotiations.
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Interests
Varied goals and expectations that stakeholders have, which may include financial gains, job security, or product/service quality.
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Internal Stakeholders
Individuals or groups within a business with a direct interest in its operations and outcomes, such as employees, managers, and shareholders.
66
Investing
Allocating capital to gain returns or profits, a key aspect of global financial markets for both businesses and individual investors.
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Investments
Allocation of money to assets, such as stocks or bonds, with the expectation of generating income or profit.
68
Lending
Providing funds to external entities with the expectation of repayment, a common activity in global financial markets.
69
Loans
Sum of money borrowed from a lender that must be repaid, typically with interest, over an agreed-upon period.
70
Long-Term Strategic Plans
Fundamental blueprints guiding a business over an extended period, outlining overarching goals, mission, vision, and strategies for sustainable growth.
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Management
The process of planning, organizing, coordinating, and controlling resources to achieve the goals of an organization.
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Managing Stakeholder Needs
The process of addressing and satisfying the needs of both internal and external stakeholders to ensure overall business success.
73
Market Conduct
Business behavior within the market, encompassing pricing, marketing strategies, and responses to competitors.
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Market Context
The perspective that focuses on the dynamics of meeting consumer needs, competitive pressures, and differentiation in the market.
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Market Economy
An economic system where prices and production are determined by competition and consumer demand.
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Market Leadership
Establishing a dominant position in the industry to shape market trends and influence competitors.
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Market Positioning
Determining the image and identity of a brand or product in the market, influencing consumer perception and choices.
78
Market Trends
Patterns and shifts in consumer behavior and preferences, crucial for businesses to analyze and adapt to.
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Marketing Strategies
Plans and tactics used by businesses to promote their products or services, attract customers, and gain a competitive advantage.
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Maximizing Shareholder Value
Making decisions that enhance the financial interests and returns of shareholders while considering other stakeholders.
81
Merger Negotiations
Talks between companies to combine their operations, necessitating confidentiality to prevent premature disclosure of sensitive information.
82
Mergers and Acquisitions
Strategies involving the combination of companies through mergers or the acquisition of one company by another.
83
Money Market
Deals with foreign exchange and short-term loans, providing liquidity and financing for businesses and governments globally.
84
Mortgages
Loans secured by real estate, typically used to finance the purchase of a home.
85
Needs and Wants
Distinctive elements that drive consumer demand. Needs are essential for survival, while wants enhance quality of life.
86
Not-for-Profit
An organization, such as a charity or social enterprise, that operates with a mission to create positive social or environmental impact.
87
Operational Plans
Plans covering a timeframe of one to three years, translating high-level strategic goals into actionable steps and milestones for resource allocation and coordination.
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Opportunities
Favorable circumstances or situations arising from globalisation, such as expanded markets and increased business prospects.
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Opportunity Cost
The value of the next best alternative foregone when a decision is made, reflecting trade-offs in decision-making due to limited resources.
90
Personal Loans
Loans provided to individuals for personal use, often unsecured and based on the borrower's creditworthiness.
91
Premature Disclosure
Unauthorized release of sensitive information before an appropriate time, which can negatively impact business negotiations or market perception.
92
Pricing
The strategy of determining the cost of products or services based on market factors, competition, and business objectives.
93
Private Business
A business owned and operated by private individuals or companies for profit, not publicly traded.
94
Private Sector
Businesses and industries owned and operated by private individuals, companies, or shareholders for profit.
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Procurement
The process of obtaining goods and services, including negotiations, purchasing, and supplier relationship management.
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Product Development
The process of creating and improving products to meet consumer needs and respond to market demands.
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Profit
The financial gain obtained when revenue exceeds expenses, a key objective for private businesses.
98
Profitability
The ability of a business to generate profit, typically measured by the ratio of earnings to expenses.
99
Promotion
The advancement of employees to higher roles or positions within the organization based on performance and skills.
100
Public Business
An organization, often government-related, providing services for the public good and not driven by profit motives.
101
Public Sector
Organizations and services owned or funded by the government, providing essential services for the public good.
102
Quality
The standard or level of excellence of products or services offered by a business, influencing customer satisfaction.
103
Recruitment
The process of attracting, assessing, and hiring qualified individuals to fill positions within the organization.
104
Regulatory Compliance
Adherence to laws and regulations governing business operations, including data protection, health and safety, and financial reporting.
105
Regulatory Oversight
The supervision and monitoring by regulatory authorities to ensure compliance with laws and regulations in the financial industry.
106
Remuneration
The compensation or payment provided to employees for their work, including wages, salaries, and benefits.
107
Reporting Standards
Consistent guidelines and frameworks for reporting financial information, essential for transparency in global financial transactions.
108
Research and Development
The process of innovating and improving products or processes through systematic investigation and experimentation.
109
Resource Allocation
The distribution of resources such as capital, labor, or assets to specific projects or investments within a business.
110
Retained Earnings
Profits that a company keeps for reinvestment in its operations, rather than distributing them to shareholders.
111
Returns
The gains or profits obtained from an investment or business activity, a crucial factor in evaluating opportunity costs.
112
Returns on Investment
The financial gains or losses generated from investments made by a company.
113
Revenue
The total income generated by a company from its operations, including sales of goods or services.
114
Risk
The likelihood of an adverse event occurring, especially in the context of business ventures and investment decisions.
115
Risk Management
The identification, assessment, and mitigation of potential risks to minimize their impact on business operations.
116
Risk-reward Trade-offs
Balancing the potential for profits with the level of risk involved, a crucial aspect of decision-making in business.
117
Service Provision
Delivering essential services efficiently and effectively to meet the needs of the public, a primary objective for public sector organizations.
118
Service Quality
Emphasizing the delivery of reliable, accessible, and satisfactory services to the public, a key objective for public sector organizations.
119
Shareholders
Owners of a company, each with their own expectations and goals, primarily seeking profits from their investments.
120
Short-Term Business Tactics
Day-to-day actions and decisions undertaken to achieve immediate or near-term objectives, closely aligned with operational plans and strategic goals.
121
Skill, Care, and Diligence
Attributes expected from a competent workforce, involving proficiency, attentiveness, and careful execution of duties.
122
Skills Shortages
Gaps in the workforce where specific skills or qualifications are lacking, posing challenges for the business.
123
Social Responsibility
Operating with a focus on making a positive impact beyond financial gains, addressing societal needs and supporting communities.
124
Social Welfare Initiatives
Programs and services supported by businesses' tax contributions, such as education and healthcare, benefiting the broader society.
125
Stakeholders
Individuals or groups with a vested interest in the success and operations of an organization.
126
Strategic Decisions
Choices made by businesses to achieve long-term objectives, often involving the consideration of opportunity costs.
127
Surplus Generation
Raising funds and accepting donations to generate surpluses reinvested in social, environmental, or cultural initiatives.
128
Survival
A fundamental objective for new or struggling businesses, focusing on maintaining operations and overcoming challenges.
129
Sustainable Growth
Achieving growth in a way that balances economic, social, and environmental considerations for long-term viability.
130
Tax Obligations
The responsibility of businesses to pay taxes, providing revenue for the government to fund public goods and services.
131
Technology
The application of scientific knowledge and advancements to create tools, systems, and processes that improve business operations.
132
Trade
The exchange of goods and services between countries or regions, a significant driver of global economic interdependence.
133
Trade-offs
The sacrifices or compromises made when choosing one option over another, considering opportunity costs.
134
Traditional Banks
Conventional banking institutions that provide financial services such as loans, deposits, and investments.
135
Training
The process of developing employee skills and knowledge through learning programs and educational opportunities.
136
Transparency
Openness and clarity in financial reporting, making information easily accessible and understandable for investors and stakeholders.
137
Transportation
The movement of goods, people, or information from one place to another, facilitating global trade and connectivity.
138
Trust
The confidence and reliance on the integrity and reliability of parties involved in business negotiations, strengthened through confidentiality.
139
Unions
Organizations formed by workers to collectively address and negotiate workplace issues, representing employee interests.
140
Value for Money
Providing quality services while optimizing the use of public funds, emphasizing efficiency and cost-effectiveness.
141
Willingness to Pay
The amount of money consumers are willing to spend on goods and services, influencing pricing strategies.
142
Workforce Motivation
Strategies and practices aimed at inspiring and energizing employees to perform their best and achieve organizational goals.
143
Working Practices
The methods and procedures followed by employees in carrying out their tasks and responsibilities within the organization.
