Primary Beneficiary
An entity that consolidates a variable interest entity (VIE). See paragraphs 810-10-25-38 through 25-38J for guidance on determining the primary beneficiary.
Glossary
Codification terms, A to Z
1287 defined terms, each linked to the subtopics that use it.
a
A time-and-material contract
Contracts that generally provide for payments to the contractor on the basis of direct labor hours at fixed hourly rates (that cover the cost of direct labor and indirect expenses and profit) and cost of materials or other specified costs. Common variations of time and material contracts areas follows: Time at marked-up rate Time at marked-up rate, material at cost Time and material at marked-up rates Guaranteed maximum cost—labor only or labor and material.
A unit-price contract
Contracts under which the contractor is paid a specified amount for every unit of work performed. A unit-price contract is essentially a fixed-price contract with the only variable being units of work performed. Variations in unit-price contracts include the same type of variations as fixed-price contracts. A unit-price contract is normally awarded on the basis of a total price that is the sum of the product of the specified units and unit prices. The method of determining total contract price may give rise to unbalanced unit prices because units to be delivered early in the contract may be assigned higher unit prices than those to be delivered as the work under the contract progresses.
absolute priority doctrine
A doctrine that provides that if an impaired class does not vote in favor of a plan, the court may nevertheless confirm the plan under the cram-down provisions of the Bankruptcy Code. The absolute priority doctrine is triggered when the cram-down provisions apply. The doctrine states that all members of the senior class of creditors and equity interests must be satisfied in full before the members of the second senior class of creditors can receive anything, and the full satisfaction of that class must occur before the third senior class of creditors may be satisfied, and so on.
Used in 1 subtopic:852-10
Accident Year
The year in which a covered event (as defined by the terms of the contract) occurs.
Used in 1 subtopic:944-40
accounting change
A change in an accounting principle, an accounting estimate, or the reporting entity. The correction of an error in previously issued financial statements is not an accounting change.
Accretion Expense
An amount recognized as an expense classified as an operating item in the statement of income resulting from the increase in the carrying amount of the liability associated with the asset retirement obligation.
accumulated benefit obligation
The actuarial present value of benefits (whether vested or nonvested) attributed, generally by the pension benefit formula, to employee service rendered before a specified date and based on employee service and compensation (if applicable) before that date. The accumulated benefit obligation differs from the projected benefit obligation in that it includes no assumption about future compensation levels. For plans with flat-benefit or non-pay-related pension benefit formulas, the accumulated benefit obligation and the projected benefit obligation are the same.
Used in 1 subtopic:715-30
accumulated eligibility credits
Plan participants may qualify for a benefit in which eligibility credits or hours accumulate and result in the plan covering payment of insurance premiums or benefits for a period of time for those participants who have accumulated a sufficient number of such credits or hours to be eligible for the credits. Eligible participants are provided with insurance coverage during periods of unemployment, when employer contributions to the plan would not otherwise provide coverage or benefits. The accumulated eligibility credits are sometimes referred to as bank of hours.
accumulated plan benefits
Future benefit payments that are attributable under the provisions of a pension plan to employees' service rendered to the benefit information date. Accumulated plan benefits comprise benefits expected to be paid to any of the following: Retired or terminated employees or their beneficiaries Beneficiaries of deceased employees Present employees or their beneficiaries.
accumulated postretirement benefit obligation
The actuarial present value as of a particular date of all future benefits attributed to an employee's service rendered to that date assuming the plan continues in effect and that all assumptions about future events are fulfilled. The accumulated postretirement benefit obligation generally reflects a ratable allocation of expected future benefits to employee service already rendered in the attribution period. Before an employee's full eligibility date, the accumulated postretirement benefit obligation as of a particular date for an employee is the portion of the expected postretirement benefit obligation attributed to that employee's service rendered to that date; on and after the full eligibility date, the accumulated and expected postretirement benefit obligations for an employee are the same.
Used in 1 subtopic:715-60
accumulation phase
The period during an annuity contract before annuitization. An insurance entity may call an annuity having an accumulation phase a deferred annuity.
Acquiree
The business or businesses that the acquirer obtains control of in a business combination. This term also includes a nonprofit activity or business that a not-for-profit acquirer obtains control of in an acquisition by a not-for-profit entity.
Used in 14 subtopics:220-40740-805805-10805-20805-30805-40+6 more
Acquirer
The entity that obtains control of the acquiree. However, in a business combination in which a variable interest entity (VIE) is acquired, the primary beneficiary of that entity always is the acquirer. (P) December 16, 2026; (N) December 16, 2026805-10-65-5The entity that obtains control of the acquiree.See paragraphs 805-10-25-4805-10-25-5 for guidance on determining the acquirer.
Used in 27 subtopics:220-40350-10350-20350-30420-10450-10+6 more
Acquisition by a Not-for-Profit Entity
A transaction or other event in which a not-for-profit acquirer obtains control of one or more nonprofit activities or businesses and initially recognizes their assets and liabilities in the acquirer's financial statements. When applicable guidance in Topic 805 is applied by a not-for-profit entity, the term business combination has the same meaning as this term has for a for-profit entity. Likewise, a reference to business combinations in guidance that links to Topic 805 has the same meaning as a reference to acquisitions by not-for-profit entities.
Used in 25 subtopics:220-40270-10350-10350-20350-30420-10+6 more
Acquisition Costs
Costs that are related directly to the successful acquisition of new or renewal insurance contracts.
Used in 9 subtopics:220-40605-944720-944805-944825-944944-20+3 more
acquisition date
The date on which the acquirer obtains control of the acquiree.
Used in 11 subtopics:450-10740-10740-805805-10805-20805-30+5 more
Acquisition of Properties
See paragraph 932-10-S99-1, Regulation S-X Rule 4-10(a)(1), for the definition of acquisition of properties as used within that Rule.
Used in 1 subtopic:932-10
Acquisition, Development, and Construction Arrangements
Acquisition, development, or construction arrangements, in which a lender, usually a financial institution, participates in expected residual profit from the sale or refinancing of property.
Active Market
A market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.
active plan participants
Any active employee who has rendered service during the credited service period and is expected to receive benefits, including benefits to or for any beneficiaries and covered dependents, under the postretirement benefit plan. See Plan Participant.
Used in 1 subtopic:715-60
activities
The term activities is to be construed broadly. It encompasses physical construction of the asset. In addition, it includes all the steps required to prepare the asset for its intended use. For example, it includes administrative and technical activities during the preconstruction stage, such as the development of plans or the process of obtaining permits from governmental authorities. It also includes activities undertaken after construction has begun in order to overcome unforeseen obstacles, such as technical problems, labor disputes, or litigation.
Actual return on plan assets
For a funded plan, the actual return on plan assets is determined as the difference between the fair value of plan assets at the end of the period and the fair value at the beginning of the period, adjusted for contributions and payments of benefits during the period.
Used in 1 subtopic:715-30
Actual return on plan assets
The change in the fair value of the plan's assets for a period including the decrease due to expenses incurred during the period (such as income tax expense incurred by the fund, if applicable), adjusted for contributions and benefit payments during the period. For a funded plan, the actual return on plan assets shall be determined based on the fair value of plan assets (see paragraph 715-60-35-107) at the beginning and end of the period, adjusted for contributions and benefit payments. If the fund holding the plan assets is a taxable entity, the actual return on plan assets shall reflect the tax expense or benefit for the period determined in accordance with generally accepted accounting principles (GAAP). Otherwise, no provision for taxes shall be included in the actual return on plan assets.
Used in 1 subtopic:715-60
actual-income-available
A method to calculate distributions to shareholders from net investment income in which actual net investment income that has been allocated to each class (as recorded on the books) is divided by the record date shares for each class to derive the dividend payable per share.
Used in 1 subtopic:505-946
Actuarial asset value
A value assigned by an actuary to the assets of a plan generally for use in conjunction with an actuarial cost method.
Used in 1 subtopic:960-10
actuarial calculation
The periodic expected changes in the net closed block liability (on the basis of generally accepted accounting principles [GAAP]), which is after the elimination of the effect of applicable items of other comprehensive income. The amortization of deferred acquisition costs is not a component of the actuarial calculation because deferred acquisition costs are not a closed block asset.
Used in 1 subtopic:805-944
actuarial calculation date
The date as of which the actuarial calculation is performed, which is as of the date of demutualization or formation of a mutual insurance holding entity.
Used in 1 subtopic:805-944
actuarial cost method
A recognized actuarial technique used for establishing the amount and incidence of employer contributions or accounting charges for pension cost under a pension plan.
Used in 1 subtopic:205-960
actuarial present value
The value, as of a specified date, of an amount or series of amounts payable or receivable thereafter, with each amount adjusted to reflect the time value of money (through discounts for interest) and the probability of payment (by means of decrements for events such as death, disability, withdrawal, or retirement) between the specified date and the expected date of payment.
actuarial present value of accumulated plan benefits
The amount as of a benefit information date that results from applying actuarial assumptions to the benefit amounts determined pursuant to paragraphs 960-20-25-3960-20-25-4960-20-25-5 (that is, the accumulated plan benefits), with the actuarial assumptions being used to adjust those amounts to reflect the time value of money (through discounts for interest) and the probability of payment (by means of decrements such as for death, disability, withdrawal, or retirement) between the benefit information date and the expected date of payment.
adequate compensation
The amount of benefits of servicing that would fairly compensate a substitute servicer should one be required, which includes the profit that would be demanded in the marketplace. It is the amount demanded by the marketplace to perform the specific type of servicing. Adequate compensation is determined by the marketplace; it does not vary according to the specific servicing costs of the servicer.
Used in 1 subtopic:860-50
Administrative expenses
Claims that receive priority over all other unsecured claims in a bankruptcy case. Administrative expenses (sometimes referred to as administrative claims) include the actual, necessary costs and expenses of preserving the estate, including wages, salaries, or commissions for services rendered after the commencement of the case. Fees paid to professionals for services rendered after the petition is filed are considered administrative expenses.
Used in 1 subtopic:852-10
administrative service arrangements
In an administrative service arrangement, the plan retains the full obligation for plan benefits. The plan may engage an insurance entity or other third party to act as the plan administrator. The administrator makes all benefit payments, charges the plan for those payments, and collects a fee for the services provided.
Advance payments
Government advances of cash as a revolving fund or against the final payment due under an agreement.
Advance Refunding
A transaction involving the issuance of new debt to replace existing debt with the proceeds from the new debt placed in trust or otherwise restricted to retire the existing debt at a determinable future date or dates.
advance royalties
An amount paid to music publishers, record producers, songwriters, or other artists in advance of their earning royalties from record or music sales. Such an amount is based on contractual terms and is generally nonrefundable.
Advances
Generally used in marketing and pooling cooperatives to denote amounts paid to patrons before final settlement; for example, amounts paid to patrons on delivery of crops.
Used in 1 subtopic:310-905
Affiliate
A party that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with an entity. See Control.
Used in 9 subtopics:220-954220-958605-958720-958850-10860-10+3 more
affiliated entity
An entity that directly or indirectly controls, is controlled by, or is under common control with another entity; also, a party with which the entity may deal if one party has the ability to exercise significant influence over the other's operating and financial policies as discussed in Section 323-10-15.
Used in 1 subtopic:310-948
Agency Transaction
A type of exchange transaction in which the reporting entity acts as an agent, trustee, or intermediary for another party that may be a donor or donee.
agent
An entity that acts for and on behalf of another. Although the term agency has a legal definition, the term is used broadly to encompass not only legal agency, but also the relationships described in Topic 958. A recipient entity acts as an agent for and on behalf of a donor if it receives assets from the donor and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a specified beneficiary. A recipient entity acts as an agent for and on behalf of a beneficiary if it agrees to solicit assets from potential donors specifically for the beneficiary's use and to distribute those assets to the beneficiary. A recipient entity also acts as an agent if a beneficiary can compel the recipient entity to make distributions to it or on its behalf.
Used in 12 subtopics:205-958220-958320-958325-958405-958605-958+6 more
Agricultural Cooperative
The Agricultural Marketing Act of 1929 defines a cooperative association as any association in which farmers act together in processing, preparing for market, handling, and/or marketing the farm products of persons so engaged, and also means any association in which farmers act together in purchasing, testing, grading, processing, distributing, and/or furnishing farm supplies and/or farm business services. Provided, however, that such associations are operated for producers or purchasers and conform to one or both of the following requirements: No member of an agricultural cooperative association is allowed more than one vote because of the amount of stock or membership capital he may own therein. The association does not pay dividends on stock or membership capital in excess of 8 percent per year. In addition to meeting either of the requirements in this paragraph, the association shall not deal in farm products, farm supplies, and farm business services with or for nonmembers of an agricultural cooperative in an amount greater in value than the total amount of such business transacted by it with or for members. All business transacted by any cooperative association for or on behalf of the United States or any agency or instrumentality thereof shall be disregarded in determining the volume of member and nonmember business transacted by such association.
Used in 9 subtopics:205-905310-905325-905330-905405-905505-905+3 more
agricultural producers
Farmers and ranchers including, for example, those who raise crops from seeds or seedlings, breed livestock (whether registered or commercial), and feed livestock in preparation for slaughter.
air carrier
Any entity that undertakes, whether directly or indirectly or by a lease or any other arrangement, to engage in air transportation.
Used in 1 subtopic:360-908
Airframe
The structure of an aircraft, excluding engines and accessories. The principal parts of the airframe of an airplane include the fuselage (the body), wings, empennage (the assembly of stabilizing and control surfaces at the tail), landing gear, and nacelles or pods (engine housings).
Used in 1 subtopic:360-908
Airframe modifications
Modifications made to interior configurations of certain aircraft types—including the reconfiguration and replacement of seats, galley equipment, and storage space.
Used in 1 subtopic:360-908
airworthiness
The ability of a particular aircraft or component part to perform its function satisfactorily through a range of operations determined by the Federal Aviation Administration.
Used in 1 subtopic:908-10
all-in-one hedge
In an all-in-one hedge, a derivative instrument that will involve gross settlement is designated as the hedging instrument in a cash flow hedge of the variability of the consideration to be paid or received in the forecasted transaction that will occur upon gross settlement of the derivative instrument itself.
allowable costs
All costs for which revenue is intended to provide recovery. Those costs can be actual or estimated. In that context, allowable costs include interest cost and amounts provided for earnings on shareholders' investments.
Used in 11 subtopics:250-980340-980360-980405-980450-980605-980+5 more
allowance for funds used during construction
The cost of financing construction as financed partially by borrowings and partially by equity, capitalized as part of the cost of plant and equipment pursuant to requirements of the regulator.
allowed claims
The amount allowed by the Bankruptcy Court as a claim against the estate. This amount may differ from the actual settlement amount.
Used in 1 subtopic:852-10
alternative minimum tax
A tax that results from the use of an alternate determination of a corporation's federal income tax liability under provisions of the U.S. Internal Revenue Code.
Used in 1 subtopic:740-10
amenities
Features that enhance the attractiveness or perceived value of a time-sharing interval. Examples of amenities include golf courses, utility plants, clubhouses, swimming pools, tennis courts, indoor recreational facilities, and parking facilities. See also Promised Amenities.
Amortization
The process of reducing a recognized liability systematically by recognizing gains or by reducing a recognized asset systematically by recognizing losses. In accounting for pension benefits or other postretirement benefits, amortization also means the systematic recognition in net periodic pension cost or other postretirement benefit cost over several periods of amounts previously recognized in other comprehensive income, that is, gains or losses, prior service cost or credits, and any transition obligation or asset.
Amortized Cost Basis
The amortized cost basis is the amount at which a financing receivable or investment is originated or acquired, adjusted for applicable accrued interest, accretion, or amortization of premium, discount, and net deferred fees or costs, collection of cash, writeoffs, foreign exchange, and fair value hedge accounting adjustments.
Used in 8 subtopics:310-10310-20310-40320-10326-10326-20+2 more
Annual policyholder dividends
Amount of dividends to policyholders calculated and paid each year, representing the policyholders' share of divisible surplus.
annuitization
Annuitization refers to the policyholder receiving periodic payments under various payment options, including their remaining life or for a term-certain period.
annuity contract
A contract in which an insurance entity unconditionally undertakes a legal obligation to provide specified pension benefits to specific individuals in return for a fixed consideration or premium. An annuity contract is irrevocable and involves the transfer of significant risk from the employer to the insurance entity. Annuity contracts are also called allocated contracts.
antidilution
An increase in earnings per share amounts or a decrease in loss per share amounts.
Used in 1 subtopic:260-10
applicable statutory Federal income tax rate
See paragraph 740-10-S99-1, SAB Topic 6.I.1, Question 2, for the definition of applicable statutory Federal income tax rate.
Used in 1 subtopic:740-10
Assessment entities
An insurance entity that sells insurance to groups with similar interests, such as church denominations or professional groups. Some assessment entities also sell insurance directly to the general public. If funds are not sufficient to pay claims, then assessments may be made against members.
asset group
An asset group is the unit of accounting for a long-lived asset or assets to be held and used, which represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities.
Used in 1 subtopic:360-10
asset retirement cost
The amount capitalized that increases the carrying amount of the long-lived asset when a liability for an asset retirement obligation is recognized.
Used in 1 subtopic:410-20
Asset Retirement Obligation
An obligation associated with the retirement of a tangible long-lived asset.
assigned amounts
Amounts used to record products delivered by patrons of a marketing cooperative operating on a pooling basis, and the related liability to patrons if the ultimate amounts to be paid to patrons are determined when the pool is closed. These amounts may be established on the basis of current prices paid by other buyers (sometimes referred to as field prices), or they may be established by the cooperative's board of directors. The assigned amounts are sometimes referred to as established values.
associate
See paragraph 942-210-S99-1, Regulation S-X Rule 9-03(7)(e)(4), for the definition of associate for the purpose of Regulation S-X Rule 9-03.
Used in 1 subtopic:210-942
association
An organization of unit owners responsible for the operation, administration, and management of the common property. Generally, a not-for-profit corporation with membership of all owners.
assumed net incurred claims cost
The annual per capita cost, for periods after the measurement date, of providing the postretirement health care benefits covered by the plan from the earliest age at which an individual could begin to receive benefits under the plan through the remainder of the individual's life or the covered period, if shorter. To determine the assumed per capita claims cost, the per capita claims cost by age based on historical claims costs is adjusted for assumed health care cost trend rates. The resulting assumed per capita claims cost by age reflects expected future costs and is applied with the plan demographics to determine the amount and timing of future gross eligible charges. See Gross Eligible Charges and Per Capita Claims Cost (by Age).
Used in 1 subtopic:715-60
assuming entity
The party that receives a reinsurance premium in a reinsurance transaction. The assuming entity (or reinsurer) accepts an obligation to reimburse a ceding entity under the terms of the reinsurance contract.
Used in 1 subtopic:340-30
Assumptions
Estimates of the occurrence of future events affecting pension costs and other postretirement benefit costs (as applicable), such as turnover, retirement age, mortality, withdrawal, disablement, dependency status, per capita claims costs by age, health care cost trend rates, levels of Medicare and other health care providers' reimbursements, changes in compensation and national pension benefits, and discount rates to reflect the time value of money.
asymmetrical default provision
A nonperformance penalty provision that requires the defaulting party to compensate the nondefaulting party for any loss incurred but does not allow the defaulting party to receive the effect of favorable price changes.
Used in 1 subtopic:815-10
attached call option
A call option held by the transferor of a financial asset that becomes part of and is traded with the underlying instrument. Rather than being an obligation of the transferee, an attached call option is traded with and diminishes the value of the underlying instrument transferred subject to that call option.
Used in 1 subtopic:860-10
attribute
The quantifiable characteristic of an item that is measured for accounting purposes. For example, historical cost and current cost are attributes of an asset.
Used in 1 subtopic:830-10
Attribution
The process of assigning pension or other postretirement benefits or costs to periods of employee service.
attribution period
The period of an employee's service to which the expected postretirement benefit obligation for that employee is assigned. The beginning of the attribution period is the employee's date of hire unless the plan's benefit formula grants credit only for service from a later date, in which case the beginning of the attribution period is generally the beginning of that credited service period. The end of the attribution period is the full eligibility date. Within the attribution period, an equal amount of the expected postretirement benefit obligation is attributed to each year of service unless the plan's benefit formula attributes a disproportionate share of the expected postretirement benefit obligation to employees' early years of service. In that case, benefits are attributed in accordance with the plan's benefit formula. See Credited Service Period.
Used in 1 subtopic:715-60
Auction Rate Notes
Auction rate notes are notes that generally have long-term nominal maturities and interest rates that reset periodically through a Dutch auction process, typically every 7, 28, or 35 days. At an auction, existing holders of auction rate notes and potential buyers enter a competitive bidding process through a broker-dealer, specifying the number of shares (units) to purchase with the lowest interest rate they are willing to accept. Generally, the lowest bid rate at which all shares can be sold at the notes' par value establishes the interest rate (also known as the clearing rate) to be applied until the next auction.
Used in 1 subtopic:815-20
automatic stay provisions
Provisions causing the filing of a petition under the Bankruptcy Code to automatically stay virtually all actions of creditors to collect prepetition debts. As a result of the stay, no party, with minor exceptions, having a security or adverse interest in the debtor's property can take any action that will interfere with the debtor or the debtor's property, regardless of where the property is located or who has possession, until the stay is modified or removed.
Used in 1 subtopic:852-10
Available-for-Sale Securities
Investments not classified as either trading securities or as held-to-maturity securities.
Award
The collective noun for multiple instruments with the same terms and conditions granted at the same time either to a single grantee or to a group of grantees. An award may specify multiple vesting dates, referred to as graded vesting, and different parts of an award may have different expected terms. References to an award also apply to a portion of an award.
b
12b-1
Rule 12b-1 in Chapter 17 of the Code of Federal Regulations is one of the regulations implementing the Investment Company Act of 1940.
backplant
A title plant that antedates the period covered by its existing title plant.
Used in 1 subtopic:350-950
Balance sheets
See paragraph 946-10-S99-2, Regulation S-X Rule 6-02(c), for the definition of balance sheets.
Used in 1 subtopic:946-10
Bankruptcy Code
A federal statute, enacted October 1, 1979, as title 11 of the United States Code by the Bankruptcy Reform Act of 1978, that applies to all cases filed on or after its enactment and that provides the basis for the current federal bankruptcy system.
Bankruptcy Court
The United States Bankruptcy Court is an adjunct of the United States District Courts. Under the jurisdiction of the District Court, the Bankruptcy Court is generally responsible for cases filed under Chapters 7, 11, 12, and 13 of the Bankruptcy Code.
Bankruptcy-Remote Entity
An entity that is designed to make remote the possibility that it would enter bankruptcy or other receivership.
Used in 1 subtopic:860-10
bargaining cooperatives
A special type of service cooperative that serves its members by negotiating with processors on their behalf.
Used in 1 subtopic:905-10
base contract
The type of contract specified in the policy form before the addition or election of riders or other contract features. For example, for an annuity with a guaranteed-minimum-income-benefit rider, the annuity would be considered the base contract.
Used in 1 subtopic:944-30
Base Jackpot
The fixed, minimum amount of a slot machine payout for a specific combination.
Benchmark Interest Rate
A widely recognized and quoted rate in an active financial market that is broadly indicative of the overall level of interest rates attributable to high-credit-quality obligors in that market. It is a rate that is widely used in a given financial market as an underlying basis for determining the interest rates of individual financial instruments and commonly referenced in interest-rate-related transactions. In theory, the benchmark interest rate should be a risk-free rate (that is, has no risk of default). In some markets, government borrowing rates may serve as a benchmark. In other markets, the benchmark interest rate may be an interbank offered rate.
Beneficial Interests
Rights to receive all or portions of specified cash inflows received by a trust or other entity, including, but not limited to, all of the following: Senior and subordinated shares of interest, principal, or other cash inflows to be passed-through or paid-through Premiums due to guarantors Commercial paper obligations Residual interests, whether in the form of debt or equity.
Used in 11 subtopics:325-40805-10810-10815-10815-20815-25+5 more
benefit information
The actuarial present value of accumulated plan benefits.
benefit information date
The date as of which the actuarial present value of accumulated plan benefits is presented.
benefit period
The period over which benefits are provided. The benefit period includes the periods during which the insurance entity is subject to risk from policyholder mortality and morbidity and during which the insurance entity is responsible for administration of the contract. The benefit period does not include the subsequent period over which the policyholder or beneficiary may elect to have settlement proceeds disbursed.
Used in 1 subtopic:944-40
Benefit security
The plan's present and future ability to pay benefits when due.
Used in 1 subtopic:960-10
benefit-years-of-service approach
One of three benefit approaches. Under this approach, an equal portion of the total estimated benefit is attributed to each year of service. The actuarial present value of the benefits is derived after the benefits are attributed to the periods.
Used in 1 subtopic:715-30
Benefits
The monetary or in-kind benefits or benefit coverage to which participants may be entitled under a pension plan or a health and welfare plan (which can include active, terminated, and retired employees or their dependents or beneficiaries). Examples of benefits may include, but are not limited to, health care benefits, life insurance, legal, educational, and advisory services, pension benefits, disability benefits, death benefits, and benefits due to termination of employment.
Used in 18 subtopics:205-960205-962205-965325-960325-962325-965+6 more
benefits of servicing
Revenues from contractually specified servicing fees, late charges, and other ancillary sources, including float.
Used in 1 subtopic:860-50
bid-ask spread
A bid-ask spread is the difference between the highest price a buyer will pay to acquire an instrument and the lowest price at which any investor will sell an instrument.
Used in 1 subtopic:815-10
blackout periods
A period of time during which exercise of an equity share option is contractually or legally prohibited.
Used in 1 subtopic:718-10
Blended-rate loans
Blended-rate loans involve lending new funds at market interest rates combined with existing loans at rates currently lower than market rates. (Those funds are not advanced under a line of credit.)
Used in 1 subtopic:310-20
blind pool
Partnerships in which investment units are sold before some or all of the properties to be acquired are identified.
Used in 1 subtopic:360-970
board-contingent plan
A reimbursement 12b-1 plan that provides that, on the plan's termination, a fund's board of directors has the option, but not the requirement, to pay the distributor for any excess costs incurred by the distributor.
Used in 1 subtopic:946-20
Board-Designated Endowment Fund
An endowment fund created by a not-for-profit entity's (NFP's) governing board by designating a portion of its net assets without donor restrictions to be invested to provide income for a long but not necessarily specified period (sometimes called funds functioning as endowment or quasi-endowment funds). In rare circumstances, a board-designated endowment fund also can include a portion of net assets with donor restrictions. For example, if an NFP is unable to spend donor-restricted contributions in the near term, then the board sometimes considers the long-term investment of these funds. See Endowment Fund.
Used in 7 subtopics:205-958210-958220-958230-10320-958605-958+1 more
Board-Designated Net Assets
Net assets without donor restrictions subject to self-imposed limits by action of the governing board. Board-designated net assets may be earmarked for future programs, investment, contingencies, purchase or construction of fixed assets, or other uses. Some governing boards may delegate designation decisions to internal management. Such designations are considered to be included in board-designated net assets.
box spreads
A combination of long calls and short puts (identical with respect to the underlying security issue, number of shares, exercise price, and expiration date) coupled with long puts and short calls (identical with respect to the underlying security issue, number of shares, exercise price, and expiration date). In boxing (coupling), the long calls and short puts with the long puts and short calls, the underlying security issue, the number of shares, and the expiration date remain identical. However, the exercise price of each combination is at a different amount.
Used in 1 subtopic:320-940
breeding herds
Breeding herds consist of mature and immature male and female animals, either of registered or commercial grade, that are maintained for their progeny.
Used in 1 subtopic:360-905
Broadcaster
An entity or an affiliated group of entities that transmits radio or television program material.
Broker-Assisted Cashless Exercise
The simultaneous exercise by a grantee of a share option and sale of the shares through a broker (commonly referred to as a broker-assisted exercise). Generally, under this method of exercise: The grantee authorizes the exercise of an option and the immediate sale of the option shares in the open market. On the same day, the entity notifies the broker of the sale order. The broker executes the sale and notifies the entity of the sales price. The entity determines the minimum statutory tax-withholding requirements. By the settlement day (generally three days later), the entity delivers the stock certificates to the broker. On the settlement day, the broker makes payment to the entity for the exercise price and the minimum statutory withholding taxes and remits the balance of the net sales proceeds to the grantee.
Used in 1 subtopic:718-10
Brokered Market
A market in which brokers attempt to match buyers with sellers but do not stand ready to trade for their own account. In other words, brokers do not use their own capital to hold an inventory of the items for which they make a market. The broker knows the prices bid and asked by the respective parties, but each party is typically unaware of another party's price requirements. Prices of completed transactions are sometimes available. Brokered markets include electronic communication networks, in which buy and sell orders are matched, and commercial and residential real estate markets.
Used in 1 subtopic:820-10
Business
Paragraphs 805-10-55-3A805-10-55-4805-10-55-5805-10-55-6 and 805-10-55-8805-10-55-9 define what is considered a business.
Used in 33 subtopics:205-10205-20220-40350-10350-20350-30+6 more
Business Combination
A transaction or other event in which an acquirer obtains control of one or more businesses. Transactions sometimes referred to as true mergers or mergers of equals also are business combinations. See also Acquisition by a Not-for-Profit Entity.
Used in 16 subtopics:220-40350-20740-805805-10805-20805-30+6 more
Business Interruption Insurance
Insurance that provides coverage if business operations are suspended due to the loss of use of property and equipment resulting from a covered cause of loss. Business interruption insurance coverage generally provides for reimbursement of certain costs and losses incurred during the reasonable period required to rebuild, repair, or replace the damaged property.
Used in 1 subtopic:220-30
c
cable television plant
The cable television plant required to render service to the subscriber includes the following equipment: Head-end. This includes the equipment used to receive signals of distant television or radio stations, whether directly from the transmitter or from a microwave relay system. It also includes the studio facilities required for operator-originated programming, if any. Cable. This consists of cable and amplifiers (which maintain the quality of the signal) covering the subscriber area, either on utility poles or underground. Drops. These consist of the hardware that provides access to the main cable, the short length of cable that brings the signal from the main cable to the subscriber's television set, and other associated hardware, which may include a trap to block particular channels. Converters and descramblers. These devices are attached to the subscriber's television sets when more than 12 channels are provided or when special services are provided, such as pay cable or 2-way communication.
Used in 1 subtopic:350-922
calculated value
A measure of the value of a share option or similar instrument determined by substituting the historical volatility of an appropriate industry sector index for the expected volatility of a nonpublic entity's share price in an option-pricing model.
call option
A contract that allows the holder to buy a specified quantity of stock from the writer of the contract at a fixed price for a given period. See Option and Purchased Call Option.
capacity contract
An agreement by an owner of capacity to sell the right to that capacity to another party so that it can satisfy its obligations. For example, in the electric industry, capacity (sometimes referred to as installed capacity) is the capability to deliver electric power to the electric transmission system of an operating control area.
Used in 1 subtopic:815-10
capital infusions
Expenditures made directly to the issuer to ensure that operations are completed, thereby allowing the issuer to generate cash flows to service the debt. Such expenditures are usually nonrecurring. In certain cases, bondholders may receive additional promissory notes, or the original bond instrument may be amended to provide for repayment of the capital infusions.
Used in 1 subtopic:320-946
capitalization rate
Rate used to determine amount of interest to be capitalized in an accounting period.
Used in 1 subtopic:835-20
capitalize
Capitalize is used to indicate that the cost would be recorded as the cost of an asset. That procedure is often referred to as deferring a cost, and the resulting asset is sometimes described as a deferred cost.
captive insurer
An insurance entity that does business primarily with related entities.
career-average-pay
A benefit formula that bases benefits on the employee's compensation over the entire period of service with the employer. A career-average-pay plan is a plan with such a formula.
Used in 1 subtopic:715-30
carrybacks
Deductions or credits that cannot be utilized on the tax return during a year that may be carried back to reduce taxable income or taxes payable in a prior year. An operating loss carryback is an excess of tax deductions over gross income in a year; a tax credit carryback is the amount by which tax credits available for utilization exceed statutory limitations. Different tax jurisdictions have different rules about whether excess deductions or credits may be carried back and the length of the carryback period.
Used in 1 subtopic:740-10
carryforwards
Deductions or credits that cannot be utilized on the tax return during a year that may be carried forward to reduce taxable income or taxes payable in a future year. An operating loss carryforward is an excess of tax deductions over gross income in a year; a tax credit carryforward is the amount by which tax credits available for utilization exceed statutory limitations. Different tax jurisdictions have different rules about whether excess deductions or credits may be carried forward and the length of the carryforward period. The terms carryforward, operating loss carryforward, and tax credit carryforward refer to the amounts of those items, if any, reported in the tax return for the current year.
carrying amount
For a receivable, the face amount increased or decreased by applicable accrued interest and applicable unamortized premium, discount, finance charges, or issue costs and also an allowance for uncollectible amounts and other valuation accounts.For a payable, the face amount increased or decreased by applicable accrued interest and applicable unamortized premium, discount, finance charges, or issue costs
Used in 7 subtopics:310-20360-944470-60805-944825-944944-40+1 more
Cash
Consistent with common usage, cash includes not only currency on hand but demand deposits with banks or other financial institutions. Cash also includes other kinds of accounts that have the general characteristics of demand deposits in that the customer may deposit additional funds at any time and also effectively may withdraw funds at any time without prior notice or penalty. All charges and credits to those accounts are cash receipts or payments to both the entity owning the account and the bank holding it. For example, a bank's granting of a loan by crediting the proceeds to a customer's demand deposit account is a cash payment by the bank and a cash receipt of the customer when the entry is made.
cash advance method
The cash advance method is a prohibited method of accounting for inventories of a marketing cooperative operating on a pooling basis. Under this method, inventories are accounted for at the amount of cash advances made to patrons. (This is sometimes referred to as the cost advance method.)
Used in 1 subtopic:330-905
Cash Consideration
Cash payments and credits that the customer can apply against trade amounts owed to the vendor. In addition, as indicated in Section 718-10-25, consideration in the form of share-based payment awards is recognized in the same period or periods and in the same manner (that is, capitalize versus expense) as if the entity had paid cash for the goods or services instead of paying with or using the share-based payment awards. Accordingly, guidance with respect to cash consideration is applicable to consideration that consists of equity instruments.
Used in 1 subtopic:705-20
cash equivalents
Cash equivalents are short-term, highly liquid investments that have both of the following characteristics: Readily convertible to known amounts of cash So near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Generally, only investments with original maturities of three months or less qualify under that definition. Original maturity means original maturity to the entity holding the investment. For example, both a three-month U.S. Treasury bill and a three-year U.S. Treasury note purchased three months from maturity qualify as cash equivalents. However, a Treasury note purchased three years ago does not become a cash equivalent when its remaining maturity is three months. Examples of items commonly considered to be cash equivalents are Treasury bills, commercial paper, money market funds, and federal funds sold (for an entity with banking operations).
Used in 7 subtopics:210-10230-10230-830230-958320-10610-20+1 more
cash flow hedge
A hedge of the exposure to variability in the cash flows of a recognized asset or liability, or of a forecasted transaction, that is attributable to a particular risk.
Cash Flows Expected at Acquisition
The investor's estimate, at acquisition, of the amount and timing of undiscounted principal, interest, and other cash flows expected to be collected. This would be the investor's best estimate of cash flows, including the effect of prepayments if considered, that is used in determining the acquisition price, and, in a business combination, the investor's estimate of fair value for purposes of acquisition price assignment in accordance with Subtopic 805-20. One acceptable method of making this estimate is described in paragraphs 820-10-55-3F820-10-55-3G and 820-10-55-4820-10-55-5820-10-55-6820-10-55-7820-10-55-8820-10-55-9820-10-55-10820-10-55-11820-10-55-12820-10-55-13820-10-55-14820-10-55-15820-10-55-16820-10-55-17820-10-55-18820-10-55-19820-10-55-20, which provide guidance on present value techniques.
Used in 1 subtopic:310-30
cash surrender value
The amount of cash that may be realized by the owner of a life insurance contract or annuity contract upon discontinuance and surrender of the contract before its maturity. The cash surrender value may be different from the policy account balance due to outstanding loans (including accrued interest) and surrender charges. (Note: The use of this glossary term is not consistent among legal contracts. When determining the applicability of this term, the economic substance of the item shall be taken into consideration.)
causes
The causes, conditions, needs, or concerns that a not-for-profit entity's (NFP's) programs are designed to address.
Used in 1 subtopic:720-958
Cease-Use Date
The date the entity ceases using the right conveyed by the contract, for example, to receive future goods or services.
Used in 1 subtopic:420-10
ceding entity
The party that pays a reinsurance premium in a reinsurance transaction. The ceding entity receives the right to reimbursement from the assuming entity under the terms of the reinsurance contract.
Used in 7 subtopics:310-944340-30405-944605-944825-944944-20+1 more
certificates
An insurance entity issues to each individual in a group contract a certificate of insurance for each person insured under the group contract. The certificate is merely a summary of the rights, duties, and benefits available under a group policy. If there is any conflict between the certificate and a group policy, the group policy is the controlling document. (Note: The use of this glossary term is not consistent among legal contracts. When determining the applicability of this term, the economic substance of the item shall be taken into consideration.)
Used in 1 subtopic:325-30
change in accounting estimate
A change that has the effect of adjusting the carrying amount of an existing asset or liability or altering the subsequent accounting for existing or future assets or liabilities. A change in accounting estimate is a necessary consequence of the assessment, in conjunction with the periodic presentation of financial statements, of the present status and expected future benefits and obligations associated with assets and liabilities. Changes in accounting estimates result from new information. Examples of items for which estimates are necessary are uncollectible receivables, inventory obsolescence, service lives and salvage values of depreciable assets, and warranty obligations.
change in accounting estimate effected by a change in accounting principle
A change in accounting estimate that is inseparable from the effect of a related change in accounting principle. An example of a change in estimate effected by a change in principle is a change in the method of depreciation, amortization, or depletion for long-lived, nonfinancial assets.
Used in 1 subtopic:250-10
change in accounting principle
A change from one generally accepted accounting principle to another generally accepted accounting principle when there are two or more generally accepted accounting principles that apply or when the accounting principle formerly used is no longer generally accepted. A change in the method of applying an accounting principle also is considered a change in accounting principle.
change in the reporting entity
A change that results in financial statements that, in effect, are those of a different reporting entity. A change in the reporting entity is limited mainly to the following: Presenting consolidated or combined financial statements in place of financial statements of individual entities Changing specific subsidiaries that make up the group of entities for which consolidated financial statements are presented Changing the entities included in combined financial statements. Neither a business combination accounted for by the acquisition method nor the consolidation of a variable interest entity (VIE) pursuant to Topic 810 is a change in reporting entity.
Chapter 11
A reorganization action, either voluntarily or involuntarily initiated under the provisions of the Bankruptcy Code, that provides for a reorganization of the debt and equity structure of the business and allows the business to continue operations. A debtor may also file a plan of liquidation under Chapter 11.
Chapter 7
A liquidation, voluntarily or involuntarily initiated under the provisions of the Bankruptcy Code, that provides for liquidation of the business or the debtor's estate.
Used in 1 subtopic:852-10
Charitable gift annuities
A transfer of assets to a not-for-profit entity (NFP) in connection with a split-interest agreement that is in part a contribution and in part an exchange transaction. The NFP accepts the contribution and is obligated to make periodic stipulated payments to the donor or a third-party beneficiary for a specified period of time, usually either a specified number of years or until the death of the donor or third-party beneficiary.
Used in 1 subtopic:958-30
Charitable lead annuity trust
A trust established in connection with a split-interest agreement, in which a not-for-profit entity (NFP) receives distributions of a fixed amount during the agreement's term. Upon termination of the trust, the remainder of the trust assets is paid to the donor or to third-party beneficiaries designated by the donor.
Used in 1 subtopic:958-30
charitable lead trust
A trust established in connection with a split-interest agreement, in which a not-for-profit entity (NFP) receives distributions during the agreement's term. Upon termination of the trust, the remainder of the trust assets is paid to the donor or to third-party beneficiaries designated by the donor.
Used in 1 subtopic:958-30
Charitable lead unitrust
A trust established in connection with a split-interest agreement, in which a not-for-profit entity (NFP) receives distributions of a fixed percentage of the fair value of the trust's assets during the agreement's term. Upon termination of the trust, the remainder of the trust assets is paid to the donor or to third-party beneficiaries designated by the donor.
Used in 1 subtopic:958-30
Charitable remainder annuity trust
A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives distributions of a fixed amount during the agreement's term. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.
Used in 1 subtopic:958-30
charitable remainder trust
A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives specified distributions during the agreement's term. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.
Used in 1 subtopic:958-30
Charitable remainder unitrust
A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives distributions of a fixed percentage of the fair value of the trust's assets during the agreement's term. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.
Used in 1 subtopic:958-30
Charity care
Charity care represents health care services that are provided but are never expected to result in cash flows. Charity care is provided to a patient with demonstrated inability to pay. Each entity establishes its own criteria for charity care consistent with its mission statement and financial ability.
Used in 1 subtopic:605-954
chips
Money substitutes, in various denominations, issued by a gaming entity and used for wagering.
claim
A demand for payment of a policy benefit because of the occurrence of an insured event.
Used in 7 subtopics:360-944605-944805-944852-10944-20944-40+1 more
claim adjustment expenses
Expenses incurred in the course of investigating and settling claims.
claims stabilization reserve
The claims stabilization reserve is established through deductions from the policy account balance through the cost of insurance charge and is sometimes held in a general account (that is, an account that is intermingled with the insurance entity's assets) as opposed to a legally segregated account (sometimes referred to as a separate account). The amounts are accumulated in this account until a death benefit is paid. The death benefit represents a combination of the policy account balance and the claims stabilization reserve based on the contractual terms. The cost of insurance is recalculated periodically based on actual experience of the insured class. Annually, the claims stabilization reserve is reviewed and an experience credit may be issued back to the policyholder if the experience has been favorable. The balance in the claims stabilization reserve will be reviewed annually and to the extent the balance is greater than the forecasted or expected amount, an experience refund would get credited to the entity's policy account balance. An entity's claims stabilization reserve will generally be realized through the collection of death benefits or an experience refund that gets credited to the policyholder's policy account balance or upon surrender of the group policy. A claims stabilization reserve is included in a policy as a mechanism for the policyholder and the insurance entity to share in the mortality risk, which in this case is the risk that the deaths will occur sooner than originally expected. Absent a claims stabilization reserve, the policyholder's net cost of insurance would typically be higher than in a policy without a claims stabilization reserve. The claims stabilization reserve is sometimes referred to as a mortality reserve or a mortality retention reserve. (Note: The use of this glossary term is not consistent among legal contracts. When determining the applicability of this term, the economic substance of the item shall be taken into consideration.)
Used in 1 subtopic:325-30
Class of Financing Receivable
A group of financing receivables determined on the basis of both of the following:Risk characteristics of the financing receivableAn entity's method for monitoring and assessing credit risk.See paragraphs 326-20-55-11326-20-55-12326-20-55-13326-20-55-14 and 326-20-50-3.
Cleanup Call Option
An option held by the servicer or its affiliate, which may be the transferor, to purchase the remaining transferred financial assets, or the remaining beneficial interests not held by the transferor, its affiliates, or its agents in an entity (or in a series of beneficial interests in transferred financial assets within an entity) if the amount of outstanding financial assets or beneficial interests falls to a level at which the cost of servicing those assets or beneficial interests becomes burdensome in relation to the benefits of servicing.
Used in 1 subtopic:860-10
closed block
A mechanism to preserve, over time, the reasonable dividend expectations of individual policyholders with individual life, health, or annuity policies for which dividends are currently being paid or are expected to be paid under the current dividend scale. A closed block comprises a defined, limited group of policies and a defined set of assets, and is governed by a set of operating rules.
Used in 1 subtopic:805-944
closed-end funds
Closed-end funds are investment companies that issue a fixed number of shares (that generally trade on an open market) to raise capital, similar to the way in which an entity sells stock in an initial public offering.
Used in 1 subtopic:946-20
closed-form model
A valuation model that uses an equation to produce an estimated fair value. The Black-Scholes-Merton formula is a closed-form model. In the context of option valuation, both closed-form models and lattice models are based on risk-neutral valuation and a contingent claims framework. The payoff of a contingent claim, and thus its value, depends on the value(s) of one or more other assets. The contingent claims framework is a valuation methodology that explicitly recognizes that dependency and values the contingent claim as a function of the value of the underlying asset(s). One application of that methodology is risk-neutral valuation in which the contingent claim can be replicated by a combination of the underlying asset and a risk-free bond. If that replication is possible, the value of the contingent claim can be determined without estimating the expected returns on the underlying asset. The Black-Scholes-Merton formula is a special case of that replication.
Used in 1 subtopic:718-10
closure
Related to the Resource Conservation and Recovery Act of 1976: the process in which the owner-operator of a hazardous waste management unit discontinues active operation of the unit by treating, removing from the site, or disposing of on site all hazardous wastes in accordance with an Environmental Protection Agency or state-approved plan. Included, for example, are the process of emptying, cleaning, and removing or filling underground storage tanks and the capping of a landfill. Closure entails specific financial guarantees and technical tasks that are included in a closure plan and must be implemented.
coding
Generating detailed instructions in a computer language to carry out the requirements described in the detail program design. The coding of a computer software product may begin before, concurrent with, or after the completion of the detail program design.
Used in 1 subtopic:985-20
collaborative arrangements
A contractual arrangement that involves a joint operating activity (see paragraph 808-10-15-7). These arrangements involve two (or more) parties that meet both of the following requirements: They are active participants in the activity (see paragraphs 808-10-15-8808-10-15-9). They are exposed to significant risks and rewards dependent on the commercial success of the activity (see paragraphs 808-10-15-10808-10-15-11808-10-15-12808-10-15-13).
Used in 1 subtopic:808-10
collateral
Personal or real property in which a security interest has been given.
collateral assignment split-dollar life insurance
A split-dollar life insurance arrangement in which the employee (or the employee's estate or a trust controlled by the employee, referred to as the employee) owns and controls the insurance policy.
Used in 1 subtopic:715-60
Collateralized Financing Entity
A variable interest entity that holds financial assets, issues beneficial interests in those financial assets, and has no more than nominal equity. The beneficial interests have contractual recourse only to the related assets of the collateralized financing entity and are classified as financial liabilities. A collateralized financing entity may hold nonfinancial assets temporarily as a result of default by the debtor on the underlying debt instruments held as assets by the collateralized financing entity or in an effort to restructure the debt instruments held as assets by the collateralized financing entity. A collateralized financing entity also may hold other financial assets and financial liabilities that are incidental to the operations of the collateralized financing entity and have carrying values that approximate fair value (for example, cash, broker receivables, or broker payables).
Collections
Works of art, historical treasures, or similar assets that meet all of the following criteria: They are held for public exhibition, education, or research in furtherance of public service rather than financial gain. They are protected, kept unencumbered, cared for, and preserved. They are subject to an organizational policy that requires the use of proceeds from items that are sold to be for the acquisitions of new collection items, the direct care of existing collections, or both. Collections generally are held by museums; botanical gardens; libraries; aquariums; arboretums; historic sites; planetariums; zoos; art galleries; nature, science, and technology centers; and similar educational, research, and public service organizations that have those divisions; however, the definition is not limited to those entities nor does it apply to all items held by those entities.
combination award
An award with two or more separate components, each of which can be separately exercised. Each component of the award is actually a separate award, and compensation cost is measured and recognized for each component.
Used in 1 subtopic:718-10
combined financial statements
The financial statements of a combined group of commonly controlled entities or commonly managed entities presented as those of a single economic entity. The combined group does not include the parent.
Commencement Date of the Lease (Commencement Date)
The date on which a lessor makes an underlying asset available for use by a lessee. See paragraphs 842-10-55-19842-10-55-20842-10-55-21 for implementation guidance on the commencement date.
Used in 18 subtopics:210-20220-40255-10270-740310-10410-20+6 more
Commercial letters of credit
A document issued typically by a financial institution on behalf of its customer (the account party) authorizing a third party (the beneficiary), or in special cases the account party, to draw drafts on the institution up to a stipulated amount and with specified terms and conditions; it is a conditional commitment (except if prepaid by the account party) on the part of the institution to provide payment on drafts drawn in accordance with the terms of the document.
Used in 1 subtopic:460-10
commercial production
The point at which production from an orchard, vineyard, or grove first reaches a level that makes operations economically feasible, based on prices normally expected to prevail.
Used in 1 subtopic:360-905
commitment fees
Fees charged for entering into an agreement that obligates the entity to make or acquire a loan or to satisfy an obligation of the other party under a specified condition. Commitment fees include fees for letters of credit and obligations to purchase a loan or group of loans and pass-through certificates.
Used in 1 subtopic:310-20
Common costs
Costs that relate to two or more units or phases within a real estate or time-sharing project.
common interest realty associations
An association, also known as a community association, responsible for the governance of the common interest community, for which it was established to serve. A common interest realty association is generally funded by its members via periodic assessments by the common interest realty association so that it can perform its duties, which include management services and maintenance, repair, and replacement of the common property, among other duties established in the governing documents and by state statute.
Used in 7 subtopics:205-972235-972360-972720-972740-972850-972+1 more
common property
A common interest realty association's real or personal property to which title or other evidence of ownership is held by either: Individual members in common The common interest realty association directly.
common stock
A stock that is subordinate to all other stock of the issuer. Also called common shares.
communication date
The date the plan of termination for one-time employee termination benefits meets all of the criteria in paragraph 420-10-25-4 and has been communicated to employees.
Used in 1 subtopic:420-10
compensated absences
Employee absences, such as vacation, illness, and holidays, for which it is expected that employees will be paid.
Used in 1 subtopic:710-10
compensation
Reciprocal transfers of cash or other assets in exchange for services performed.
Used in 1 subtopic:720-958
compensation plan
A plan that provides for a 12b-1 fee, payable by the fund, based on a percentage of the fund's average net assets. The 12b-1 fee may be more or less than the costs incurred by the distributor.
Used in 1 subtopic:946-20
Compliance Environmental Credit
(P) December 16, 2027; (N) December 16, 2028818-10-65-1An environmental credit recognized as an asset in accordance with Topic 818 and probable of being used to settle an environmental credit obligation.
component of an entity
A component of an entity comprises operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the entity. A component of an entity may be a reportable segment or an operating segment, a reporting unit, a subsidiary, or an asset group.
Comprehensive Income
The change in equity (net assets) of a business entity during a period from transactions and other events and circumstances from nonowner sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners. Comprehensive income comprises both of the following:All components of net incomeAll components of other comprehensive income.
Condensate
Condensate is a mixture of hydrocarbons that exists in the gaseous phase at original reservoir temperature and pressure but that when produced is in the liquid phase at surface pressure and temperature.
Used in 1 subtopic:932-10
Condensed Statements
(P) December 16, 2027; (N) December 16, 2028 270-10-65-1 Financial statements that are presented at a level that is more aggregated than the annual financial statements or have limited notes subject to the disclosure requirements in Topic 270 or both. (U.S. Securities and Exchange Commission [SEC] registrants are required to consider the guidance in paragraph 270-10-S45-2. See Regulation S-X Rule 10-01 [17 CFR 210.10-01] and Regulation S-X Rule 8-03 [17 CFR 210.8-03].)
conditional asset retirement obligation
A legal obligation to perform an asset retirement activity in which the timing and (or) method of settlement are conditional on a future event that may or may not be within the control of the entity.
Used in 1 subtopic:410-20
Conditional Contribution
A contribution that contains a donor-imposed condition.
Used in 25 subtopics:205-954205-958220-954220-958230-10230-958+6 more
Conditional Promise to Give
A promise to give that is subject to a donor-imposed condition.
condominium
A form of ownership of real property that combines exclusive ownership of a defined space and an undivided interest in the common elements. (Also referred to as a condo.) A common interest realty association is not a condominium unless the undivided interests in the common elements are vested in the unit owners.
Conduit Debt Security
Certain limited-obligation revenue bonds, certificates of participation, or similar debt instruments issued by a state or local governmental entity for the express purpose of providing financing for a specific third party (the conduit bond obligor) that is not a part of the state or local government's financial reporting entity. Although conduit debt securities bear the name of the governmental entity that issues them, the governmental entity often has no obligation for such debt beyond the resources provided by a lease or loan agreement with the third party on whose behalf the securities are issued. Further, the conduit bond obligor is responsible for any future financial reporting requirements.
Used in 15 subtopics:105-10220-10280-10360-20405-40430-954+6 more
confirmed plan
An official approval by the court of a plan of reorganization under a Chapter 11 proceeding that makes the plan binding on the debtors and creditors. Before a plan is confirmed, it must satisfy 11 requirements in section 1129(a) of the Bankruptcy Code.
Used in 1 subtopic:852-10
consent decree
A legal document, approved by a judge, that formalizes an agreement reached between the Environmental Protection Agency and potentially responsible parties through which potentially responsible parties will conduct all or part of a remedial action at a Superfund site; cease or correct actions or processes that are polluting the environment; or otherwise comply with regulations where potentially responsible parties' failure to comply caused the Environmental Protection Agency to initiate regulatory enforcement actions. The consent decree describes the actions potentially responsible parties will take and may be subject to a public comment period.
Used in 1 subtopic:410-30
consenting classes
Classes of creditors or stockholders that approve the proposed plan.
Used in 1 subtopic:852-10
Consideration in the Contract
See paragraph 842-10-15-35 for what constitutes the consideration in the contract for lessees and paragraph 842-10-15-39 for what constitutes consideration in the contract for lessors.
Used in 1 subtopic:842-10
Consolidated Affiliate of the Transferor
An entity whose assets and liabilities are included in the consolidated, combined, or other financial statements being presented.
consolidated financial statements
The financial statements of a consolidated group of entities that include a parent and all its subsidiaries presented as those of a single economic entity.
consolidation
The presentation of a single set of amounts for an entire reporting entity. Consolidation requires elimination of intra-entity transactions and balances.
Used in 1 subtopic:810-958
Consumer Price Index for All Urban Consumers
An index of price level changes affecting consumers generally, often used to measure changes in the general purchasing power of the monetary unit itself.
Used in 1 subtopic:255-10
contingencies
An existing condition, situation, or set of circumstances involving uncertainty as to possible gain (gain contingency) or loss (loss contingency) to an entity that will ultimately be resolved when one or more future events occur or fail to occur.
Contingent consideration
Usually an obligation of the acquirer to transfer additional assets or equity interests to the former owners of an acquiree as part of the exchange for control of the acquiree if specified future events occur or conditions are met. However, contingent consideration also may give the acquirer the right to the return of previously transferred consideration if specified conditions are met.
contingent issuance
A possible issuance of shares of common stock that is dependent on the satisfaction of certain conditions.
Used in 1 subtopic:260-10
contingent stock agreement
An agreement to issue common stock (usually in connection with a business combination) that is dependent on the satisfaction of certain conditions. See Contingently Issuable Shares.
Used in 1 subtopic:260-10
Contingent-Deferred Sales Load
A sales charge imposed directly on redeeming shareholders based on a percentage of the lesser of the redemption proceeds or original cost. The percentage may decrease or be eliminated based on the duration of share ownership (frequently decreases by 1 percent a year). Also referred to as back-end load.
contingently convertible instruments
Contingently convertible instruments are instruments that have embedded conversion features that are contingently convertible or exercisable based on either of the following: A market price trigger Multiple contingencies if one of the contingencies is a market price trigger and the instrument can be converted or share settled based on meeting the specified market condition. A market price trigger is a market condition that is based at least in part on the issuer's own share price. Examples of contingently convertible instruments include contingently convertible debt, contingently convertible preferred stock, and the instrument described by paragraph 260-10-45-43, all with embedded market price triggers.
continuing franchise fees
Consideration for the continuing rights granted by the franchise agreement and for general or specific services during its life.
Used in 1 subtopic:952-10
Continuing Involvement
Any involvement with the transferred financial assets that permits the transferor to receive cash flows or other benefits that arise from the transferred financial assets or that obligates the transferor to provide additional cash flows or other assets to any party related to the transfer. For related implementation guidance, see paragraph 860-10-55-79A.
Contract
An agreement between two or more parties that creates enforceable rights and obligations.
Used in 76 subtopics:210-20220-40230-10235-10235-932255-10+6 more
contract assets
An entity's right to consideration in exchange for goods or services that the entity has transferred to a customer when that right is conditioned on something other than the passage of time (for example, the entity's future performance).
Used in 9 subtopics:270-10310-912310-954326-20606-10610-20+3 more
contract exchange
The legal extinguishment of one contract and the issuance of another.
Used in 1 subtopic:944-30
contract liabilities
An entity's obligation to transfer goods or services to a customer for which the entity has received consideration (or the amount is due) from the customer.
Used in 9 subtopics:270-10310-954430-10440-954605-20606-10+3 more
Contract Period
The period over which insured events that occur are covered by insurance or reinsurance contracts. Commonly referred to as the coverage period or period that the contracts are in force.
Contract Value
The value of an unallocated contract that is determined by the insurance entity in accordance with the terms of the contract.
Contract Value of a Fully Benefit-Responsive Investment Contract
The contract value of a fully benefit-responsive investment contract held by a defined contribution health and welfare benefit plan is the amount a participant would receive if he or she were to initiate transactions under the terms of the ongoing plan.
Used in 1 subtopic:325-965
contractors
A person or entity that enters into a contract to construct facilities, produce goods, or render services to the specifications of a buyer either as a general or prime contractor, as a subcontractor to a general contractor, or as a construction manager.
Used in 1 subtopic:605-35
contractually specified component
An index or price explicitly referenced in an agreement to purchase or sell a nonfinancial asset other than an index or price calculated or measured solely by reference to an entity's own operations.(P) December 16, 2026; (N) December 16, 2027815-20-65-7Glossary term superseded by Accounting Standards Update No. 2025-09.
Contractually Specified Servicing Fees
All amounts that, per contract, are due to the servicer in exchange for servicing the financial asset and would no longer be received by a servicer if the beneficial owners of the serviced assets (or their trustees or agents) were to exercise their actual or potential authority under the contract to shift the servicing to another servicer. Depending on the servicing contract, those fees may include some or all of the difference between the interest rate collectible on the financial asset being serviced and the rate to be paid to the beneficial owners of those financial assets.
Used in 1 subtopic:860-50
Contribution
An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.
Used in 25 subtopics:205-954205-958220-954220-958230-10230-958+6 more
Contributions Receivable
Contributions receivable are the amounts due, as of the date of the financial statements, to the plan from employers, participants, and other sources of funding (for example, state subsidies or federal grants). They include amounts due pursuant to firm commitments, as well as legal or contractual requirements.
Contributory Plan
A plan under which retirees or active employees contribute part of the cost. In some contributory plans, retirees or active employees wishing to be covered must contribute; in other contributory plans, participants' contributions result in increased benefits.
control
The possession, direct or indirect, of the power to direct or cause the direction of the management and policies of an entity through ownership, by contract, or otherwise.
Used in 10 subtopics:310-20605-958805-10805-20805-50805-60+4 more
controlled amortization method
Liquidation method used to allocate principal payments on the receivables in a trust to the investors, under which a predetermined monthly payment schedule is established so that payout to the investors will occur over a specified liquidation period. Principal payments are allocated to the investors based on their participation interests in the receivables in the trust, using one of the liquidation methods (fixed, preset, or floating). Principal payments in excess of the predetermined monthly payment, if any, are allocated to the transferor and increase the investors' ownership interests. If the principal payments allocated to the investors are insufficient to cover the predetermined monthly payment, that payment is reduced by the amount of the deficiency. If the principal payments allocated to the investors in subsequent months exceed the predetermined monthly payment, the deficiency is recovered.
Used in 1 subtopic:860-10
conversion rate
The ratio of the number of common shares issuable upon conversion to a unit of a convertible security. For example, $100 face value of debt convertible into 5 shares of common stock would have a conversion ratio of 5:1. Also called conversion ratio.
Used in 1 subtopic:260-10
convertible security
A security that is convertible into another security based on a conversion rate. For example, convertible preferred stock that is convertible into common stock on a two-for-one basis (two shares of common for each share of preferred).
Cooperatives
Also referred to as a coop, a cooperative housing corporation is an entity established as a corporation that owns the real estate, usually a multi-unit dwelling, and all improvements on it and is responsible for its maintenance and payment of debt service. Ownership in the corporation is evidenced by shares of stock owned by tenant-shareholders who are entitled to occupy a unit under a proprietary lease. The individual ownership interests in most cooperatives are structured as personal property interests, but some are structured as real property interests.
Corporate Joint Venture
A corporation owned and operated by a small group of entities (the joint venturers) as a separate and specific business or project for the mutual benefit of the members of the group. A government may also be a member of the group. The purpose of a corporate joint venture frequently is to share risks and rewards in developing a new market, product or technology; to combine complementary technological knowledge; or to pool resources in developing production or other facilities. A corporate joint venture also usually provides an arrangement under which each joint venturer may participate, directly or indirectly, in the overall management of the joint venture. Joint venturers thus have an interest or relationship other than as passive investors. An entity that is a subsidiary of one of the joint venturers is not a corporate joint venture. The ownership of a corporate joint venture seldom changes, and its stock is usually not traded publicly. A noncontrolling interest held by public ownership, however, does not preclude a corporation from being a corporate joint venture.
Used in 24 subtopics:205-10205-20220-40323-10323-970350-10+6 more
corrective action
Related to the Resource Conservation and Recovery Act of 1976: action to remedy releases from hazardous waste management units, or any other sources of releases at or from a treatment, storage, or disposal facility.
Used in 1 subtopic:410-30
Cost Approach
A valuation approach that reflects the amount that would be required currently to replace the service capacity of an asset (often referred to as current replacement cost).
Used in 1 subtopic:820-10
cost recovery method
A revenue recognition method under which premiums are recognized as revenue in an amount equal to estimated claim costs as insured events occur until the ultimate premium is reasonably estimable, and recognition of income is postponed until that time.
Used in 1 subtopic:605-944
cost-plus-fixed-fee contracts
A contract under which the contractor is reimbursed for costs plus the provision for a fixed fee.
cost-sharing provisions of the plan
The provisions of the postretirement benefit plan that describe how the costs of the covered benefits are to be shared between the employer and the plan participants. Cost-sharing provisions describe retired and active plan participants' contributions toward their postretirement health care benefits, deductibles, coinsurance, out-of-pocket limitations on participant costs, caps on employer costs, and so forth.
Used in 1 subtopic:715-60
cost-type (including cost-plus) contract
Contracts that provide for reimbursement of allowable or otherwise defined costs incurred plus a fee that represents profit. Cost-type contracts usually only require that the contractor use his best efforts to accomplish the scope of the work within some specified time and some stated dollar limitation. See also the following common variations of cost-plus contracts: Cost-Plus-Award-Fee Contract Cost-Plus-Fixed-Fee Contract Cost-Plus-Incentive-Fee Contract (Incentive Based on Cost) Cost-Plus-Incentive-Fee Contract (Incentive Based on Performance) Cost-Sharing Contract Cost-Without-Fee Contract.
costs incurred to rent real estate projects
Costs related to real estate rental activities, including the following: Model units and their furnishings Rental facilities Semipermanent signs Rental brochures Advertising Grand openings Rental overhead including rental salaries.
Used in 1 subtopic:340-970
Costs incurred to sell real estate projects
Costs related to the sale of real estate, including the following: Model units and their furnishings Sales facilities Sales brochures Legal fees for preparation of prospectuses Semipermanent signs Advertising Grand openings Sales overhead including sales salaries.
Used in 1 subtopic:340-970
costs of joint activities
Costs incurred for a joint activity. Costs of joint activities may include joint costs and costs other than joint costs. Costs other than joint costs are costs that are identifiable with a particular function, such as fundraising, program, management and general, and cost of sales. For example, some costs incurred for printing, paper, professional fees, and salaries to produce donor cards are not joint costs, although they may be incurred in connection with conducting joint activities.
Used in 1 subtopic:720-958
coverage
An insurance entity's exposure to loss. The concept of coverage would typically include policy limits, deductible, insured, and covered property or insured event.
cram-down provisions
Provisions requiring that for a plan to be confirmed, a class of claims or interests must either accept the plan or not be impaired. However, the Bankruptcy Code allows the Bankruptcy Court under certain conditions to confirm a plan even though an impaired class has not accepted the plan. To do so, the plan must not discriminate unfairly and must be fair and equitable to each class of claims or interests impaired under the plan that have not accepted it. The Bankruptcy Code states examples of conditions for secured claims, unsecured claims, and stockholder interests in the fair and equitable requirement.
Used in 1 subtopic:852-10
credit card fees
The periodic uniform fees that entitle cardholders to use credit cards. The amount of such fees generally is not dependent upon the level of credit available or frequency of usage. Typically the use of credit cards facilitates the cardholder's payment for the purchase of goods and services on a periodic, as-billed basis (usually monthly), involves the extension of credit, and, if payment is not made when billed, involves imposition of interest or finance charges. Credit card fees include fees received in similar arrangements, such as charge card and cash card fees.
Used in 1 subtopic:310-20
credit derivative
A derivative instrument that has both of the following characteristics: One or more of its underlyings are related to any of the following: The credit risk of a specified entity (or a group of entities) An index based on the credit risk of a group of entities. It exposes the seller to potential loss from credit-risk-related events specified in the contract. Examples of credit derivatives include, but are not limited to, credit default swaps, credit spread options, and credit index products.
credit life insurance
Life insurance, generally in the form of decreasing term insurance, that is issued on the lives of borrowers to cover payment of loan balances in case of death.
Used in 1 subtopic:944-20
Credit Quality Indicator
A statistic about the credit quality of a financial asset.
Credit Risk
For purposes of a hedged item in a fair value hedge, credit risk is the risk of changes in the hedged item's fair value attributable to both of the following: Changes in the obligor's creditworthiness Changes in the spread over the benchmark interest ratewith respect to the hedged item's credit sector at inception of the hedge. For purposes of a hedged transaction in a cash flow hedge, credit risk is the risk of changes in the hedged transaction's cash flows attributable to all of the following: Default Changes in the obligor's creditworthiness Changes in the spread over the contractually specified interest rate or the benchmark interest rate with respect to the related financial asset's or liability's credit sector at inception of the hedge.
credited service period
Employee service period for which benefits are earned pursuant to the terms of the plan. The beginning of the credited service period may be the date of hire or a later date. For example, a plan may provide benefits only for service rendered after a specified age. Service beyond the end of the credited service period does not earn any additional benefits under the plan. See Attribution Period.
Used in 1 subtopic:715-60
crop development costs
Costs incurred up to the time crops are produced in commercial quantities, including the costs of land preparation, plants, planting, fertilization, grafting, pruning, equipment use, and irrigation.
Used in 1 subtopic:905-10
crops
Grains, vegetables, fruits, berries, nuts, and fibers grown by agricultural producers.
cross-volatility
A measure of the relationship between the volatilities of the prices of two assets taking into account the correlation between movements in the prices of the assets. See Volatility.
Used in 1 subtopic:718-20
Currency Risk
The risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.
Used in 1 subtopic:820-10
current assets
Current assets is used to designate cash and other assets or resources commonly identified as those that are reasonably expected to be realized in cash or sold or consumed during the normal operating cycle of the business. See paragraphs 210-10-45-1210-10-45-2210-10-45-3210-10-45-4.
current cost-constant purchasing power
A method of accounting based on measures of current cost or lower recoverable amount in units of currency, each of which has the same general purchasing power. For operations in which the dollar is the functional currency, the general purchasing power of the dollar is used and the Consumer Price Index for All Urban Consumers is the required measure of purchasing power. For operations in which the functional currency is other than the dollar, the general purchasing power of either the dollar or the functional currency is used (see paragraphs 255-10-50-45255-10-50-46255-10-50-47).
Used in 1 subtopic:255-10
current liabilities
Current liabilities is used principally to designate obligations whose liquidation is reasonably expected to require the use of existing resources properly classifiable as current assets, or the creation of other current liabilities. See paragraphs 210-10-45-5210-10-45-6210-10-45-7210-10-45-8210-10-45-9210-10-45-10210-10-45-11210-10-45-12.
Used in 1 subtopic:210-10
Current Tax Expense (or Benefit)
The amount of income taxes paid or payable (or refundable) for a year as determined by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues for that year.
curtailment
An event that significantly reduces the expected years of future service of present employees or eliminates for a significant number of employees the accrual of defined benefits for some or all of their future services.
Used in 1 subtopic:715-30
curtailment of a defined benefit postretirement plan
An event that significantly reduces the expected years of future service of active plan participants or eliminates the accrual of defined benefits for some or all of the future services of a significant number of active plan participants.
Used in 1 subtopic:715-60
Customer
A party that has contracted with an entity to obtain goods or services that are an output of the entity's ordinary activities in exchange for consideration.
Used in 51 subtopics:220-40235-10235-932270-10275-10326-20+6 more
customer support
Services performed by an entity to assist customers in their use of software products. Those services include any installation assistance, training classes, telephone question and answer services, newsletters, on-site visits, and software or data modifications.
Used in 1 subtopic:985-20
d
date of demutualization
The date the plan of reorganization becomes effective.
Used in 1 subtopic:805-944
daylight overdraft
Daylight overdraft or other intraday credit refers to the accommodation in the banking arrangements that allows transactions to be completed even if there is insufficient cash on deposit during the day provided there is sufficient cash to cover the net cash requirement at the end of the day. That accommodation may be through a credit facility, including a credit facility for which a fee is charged, or from a deposit of collateral.
Used in 1 subtopic:210-20
daypart
An aggregation of programs broadcast during a particular time of day (for example, daytime, evening, late night) or programs of a similar type (for example, sports, news, children's shows). Broadcasters generally sell access to viewing audiences to advertisers on a daypart basis.
Used in 1 subtopic:350-920
Dealer Market
A market in which dealers stand ready to trade (either buy or sell for their own account), thereby providing liquidity by using their capital to hold an inventory of the items for which they make a market. Typically, bid and ask prices (representing the price at which the dealer is willing to buy and the price at which the dealer is willing to sell, respectively) are more readily available than closing prices. Over-the-counter markets (for which prices are publicly reported by the National Association of Securities Dealers Automated Quotations systems or by OTC Markets Group Inc.) are dealer markets. For example, the market for U.S. Treasury securities is a dealer market. Dealer markets also exist for some other assets and liabilities, including other financial instruments, commodities, and physical assets (for example, used equipment).
Used in 1 subtopic:820-10
Debt Security
Any security representing a creditor relationship with an entity. The term debt security also includes all of the following: Preferred stock that by its terms either must be redeemed by the issuing entity or is redeemable at the option of the investor A collateralized mortgage obligation (or other instrument) that is issued in equity form but is required to be accounted for as a nonequity instrument regardless of how that instrument is classified (that is, whether equity or debt) in the issuer's statement of financial position U.S. Treasury securities U.S. government agency securities Municipal securities Corporate bonds Convertible debt Commercial paper All securitized debt instruments, such as collateralized mortgage obligations and real estate mortgage investment conduits Interest-only and principal-only strips. The term debt security excludes all of the following: Option contracts Financial futures contracts Forward contracts Lease contracts Receivables that do not meet the definition of security and, so, are not debt securities, for example: Trade accounts receivable arising from sales on credit by industrial or commercial entities Loans receivable arising from consumer, commercial, and real estate lending activities of financial institutions.
Used in 12 subtopics:220-10310-10310-20310-30320-10320-958+6 more
Debt-equity swap
A debt-equity swap is an exchange transaction of a monetary asset for a nonmonetary asset.
Used in 1 subtopic:310-942
debtor-in-possession
Existing management continuing to operate an entity that has filed a petition under Chapter 11. The debtor-in-possession is allowed to operate the business in all Chapter 11 cases unless the court, for cause, authorizes the appointment of a trustee.
Used in 1 subtopic:852-10
Decision Maker
An entity or entities with the power to direct the activities of another legal entity that most significantly impact the legal entity's economic performance according to the provisions of the Variable Interest Entities Subsections of Subtopic 810-10.
Used in 1 subtopic:810-10
deductible temporary difference
Temporary differences that result in deductible amounts in future years when the related asset or liability is recovered or settled, respectively. See Temporary Difference.
defensive intangible asset
An acquired intangible asset in a situation in which an entity does not intend to actively use the asset but intends to hold (lock up) the asset to prevent others from obtaining access to the asset.
deferment
The postponement of some or all of a debtor's payment obligations.
Used in 1 subtopic:310-978
deferred acquisition costs tax
Section 848 of the Internal Revenue Code requires insurance entities to capitalize certain policy acquisition costs and defer deducting them in determining the insurer's tax liability. These costs are known as the deferred acquisition costs tax and are based on a percentage of the premium received as specified by the Internal Revenue Code. The initial deferred acquisition costs tax is deducted from a policyholder's policy account balance when the premium is paid. The deferred acquisition costs tax is credited back to the policyholder's policy account balance as the tax deduction is recognized in the insurer's tax return. (Note: The use of this glossary term is not consistent among legal contracts. When determining the applicability of this term, the economic substance of the item shall be taken into consideration.)
Used in 1 subtopic:325-30
deferred tax asset
The deferred tax consequences attributable to deductible temporary differences and carryforwards. A deferred tax asset is measured using the applicable enacted tax rate and provisions of the enacted tax law. A deferred tax asset is reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized.
deferred tax consequences
The future effects on income taxes as measured by the applicable enacted tax rate and provisions of the enacted tax law resulting from temporary differences and carryforwards at the end of the current year.
Deferred Tax Expense (or Benefit)
The change during the year in an entity's deferred tax liabilities and assets. For deferred tax liabilities and assets acquired in a purchase business combination during the year, it is the change since the combination date. Income tax expense (or benefit) for the year is allocated among continuing operations, discontinued operations, and items charged or credited directly to shareholders' equity.
deferred tax liability
The deferred tax consequences attributable to taxable temporary differences. A deferred tax liability is measured using the applicable enacted tax rate and provisions of the enacted tax law.
Defined Benefit Plan
A defined benefit plan provides participants with a determinable benefit based on a formula provided for in the plan. Defined benefit health and welfare plans—Defined benefit health and welfare plans specify a determinable benefit, which may be in the form of a reimbursement to the covered plan participant or a direct payment to providers or third-party insurers for the cost of specified services. Such plans may also include benefits that are payable as a lump sum, such as death benefits. The level of benefits may be defined or limited based on factors such as age, years of service, and salary. Contributions may be determined by the plan's actuary or be based on premiums, actual claims paid, hours worked, or other factors determined by the plan sponsor. Even when a plan is funded pursuant to agreements that specify a fixed rate of employer contributions (for example, a collectively bargained multiemployer plan), such a plan may nevertheless be a defined benefit health and welfare plan if its substance is to provide a defined benefit. Defined benefit pension plan—A pension plan that defines an amount of pension benefit to be provided, usually as a function of one or more factors such as age, years of service, or compensation. Any pension plan that is not a defined contribution pension plan is, for purposes of Subtopic 715-30, a defined benefit pension plan. Defined benefit postretirement plan—A plan that defines postretirement benefits in terms of monetary amounts (for example, $100,000 of life insurance) or benefit coverage to be provided (for example, up to $200 per day for hospitalization, or 80 percent of the cost of specified surgical procedures). Any postretirement benefit plan that is not a defined contribution postretirement plan is, for purposes of Subtopic 715-60, a defined benefit postretirement plan. (Specified monetary amounts and benefit coverage are collectively referred to as benefits.)
Used in 16 subtopics:205-960205-965220-40310-960325-960325-965+6 more
Defined Contribution Plan
A plan that provides an individual account for each participant and provides benefits that are based on all of the following: amounts contributed to the participant's account by the employer or employee; investment experience; and any forfeitures allocated to the account, less any administrative expenses charged to the plan. Defined contribution health and welfare plans—Defined contribution health and welfare plans maintain an individual account for each plan participant. They have terms that specify the means of determining the contributions to participants' accounts, rather than the amount of benefits the participants are to receive. The benefits a plan participant will receive are limited to the amount contributed to the participant's account, investment experience, expenses, and any forfeitures allocated to the participant's account. These plans also include flexible spending arrangements. Defined contribution postretirement plan—A plan that provides postretirement benefits in return for services rendered, provides an individual account for each plan participant, and specifies how contributions to the individual's account are to be determined rather than specifies the amount of benefits the individual is to receive. Under a defined contribution postretirement plan, the benefits a plan participant will receive depend solely on the amount contributed to the plan participant's account, the returns earned on investments of those contributions, and the forfeitures of other plan participants' benefits that may be allocated to that plan participant's account.
Used in 12 subtopics:205-962205-965220-40325-962325-965360-962+6 more
Delayed Equity Investment
In leveraged lease transactions that have been structured with terms such that the lessee's rent payments begin one to two years after lease inception, equity contributions the lessor agrees to make (in the lease agreement or a separate binding contract) that are used to service the nonrecourse debt during this brief period. The total amount of the lessor's contributions is specifically limited by the agreements.
Used in 1 subtopic:842-50
demutualizations
The conversion of a mutual insurance entity to a stock insurance entity.
Used in 1 subtopic:805-944
dependency status
The status of a current or former employee having dependents (for example, a spouse or other relatives) who are expected to receive benefits under a postretirement benefit plan that provides dependent coverage.
Used in 1 subtopic:715-60
deposit method
A revenue recognition method under which premiums are not recognized as revenue and claim costs are not charged to expense until the ultimate premium is reasonably estimable, and recognition of income is postponed until that time.
derecognize
Remove previously recognized assets or liabilities from the statement of financial position.
Derivative Financial Instrument
A derivative instrument that is a financial instrument.
derivative instruments
Paragraphs 815-10-15-83815-10-15-84815-10-15-85815-10-15-86815-10-15-87815-10-15-88815-10-15-89815-10-15-90815-10-15-91815-10-15-92815-10-15-93815-10-15-94815-10-15-95815-10-15-96815-10-15-97815-10-15-98815-10-15-99815-10-15-100815-10-15-101815-10-15-102815-10-15-103815-10-15-104815-10-15-105815-10-15-106815-10-15-107815-10-15-108815-10-15-109815-10-15-110815-10-15-111815-10-15-112815-10-15-113815-10-15-114815-10-15-115815-10-15-116815-10-15-117815-10-15-118815-10-15-119815-10-15-120815-10-15-121815-10-15-122815-10-15-123815-10-15-124815-10-15-125815-10-15-126815-10-15-127815-10-15-128815-10-15-129815-10-15-130815-10-15-131815-10-15-132815-10-15-133815-10-15-134815-10-15-135815-10-15-136815-10-15-137815-10-15-138815-10-15-139 define the term derivative instrument.
Used in 11 subtopics:210-20220-40815-10815-15815-20815-25+5 more
derived service period
A service period for an award with a market condition that is inferred from the application of certain valuation techniques used to estimate fair value. For example, the derived service period for an award of share options that the employee can exercise only if the share price increases by 25 percent at any time during a 5-year period can be inferred from certain valuation techniques. In a lattice model, that derived service period represents the duration of the median of the distribution of share price paths on which the market condition is satisfied. That median is the middle share price path (the midpoint of the distribution of paths) on which the market condition is satisfied. The duration is the period of time from the service inception date to the expected date of satisfaction (as inferred from the valuation technique). If the derived service period is three years, the estimated requisite service period is three years and all compensation cost would be recognized over that period, unless the market condition was satisfied at an earlier date. Compensation cost would not be recognized beyond three years even if after the grant date the entity determines that it is not probable that the market condition will be satisfied within that period. Further, an award of fully vested, deep out-of-the-money share options has a derived service period that must be determined from the valuation techniques used to estimate fair value. See Explicit Service Period, Implicit Service Period, and Requisite Service Period.
detail program design
The detail design of a computer software product that takes product function, feature, and technical requirements to their most detailed, logical form and is ready for coding.
Used in 1 subtopic:985-20
Developed Oil and Gas Reserves
See paragraph 932-10-S99-1, Regulation S-X Rule 4-10(a)(6) for the definition of developed oil and gas reserves as used within that Rule.
Used in 1 subtopic:932-10
Development Costs
See paragraph 932-10-S99-1, Regulation S-X Rule 4-10(a)(7), for the definition of development costs as used within that Rule.
Used in 1 subtopic:932-10
development wells
A development well is a well drilled within the proved area of an oil or gas reservoir to the depth of a stratigraphic horizon known to be productive.
Developmental costs
Developmental costs include those types of costs directly related to the development of new routes (or extension of existing routes), such as advertising and promotion expenses, related travel and incidental expenses, and expenses of regulatory proceedings.
Used in 1 subtopic:720-908
dilution
A reduction in EPS resulting from the assumption that convertible securities were converted, that options or warrants were exercised, or that other shares were issued upon the satisfaction of certain conditions.
Used in 1 subtopic:260-10
Direct Effects of a Change in Accounting Principle
Those recognized changes in assets or liabilities necessary to effect a change in accounting principle. An example of a direct effect is an adjustment to an inventory balance to effect a change in inventory valuation method. Related changes, such as an effect on deferred income tax assets or liabilities or an impairment adjustment resulting from applying the subsequent measurement guidance in Subtopic 330-10to the adjusted inventory balance, also are examples of direct effects of a change in accounting principle.
Direct Financing Lease
From the perspective of a lessor, a lease that meets none of the criteria in paragraph 842-10-25-2 but meets the criteria in paragraph 842-10-25-3(b)and is not an operating lease in accordance with paragraph 842-10-25-3A.
Used in 16 subtopics:220-40255-10310-10340-970450-30805-10+6 more
direct financing lease
Glossary term superseded by Accounting Standards Update No. 2016-02.
Direct Guarantee of Indebtedness
An agreement in which a guarantor states that if the debtor fails to make payment to the creditor when due, the guarantor will pay the creditor. If the debtor defaults, the creditor has a direct claim on the guarantor.
Used in 1 subtopic:460-10
direct loan
A direct loan is a loan made by a lender other than the employer to the employee stock ownership plan. Such loans often include some formal guarantee or commitment by the employer.
Used in 1 subtopic:718-40
direct loan origination costs
Direct loan origination costs represent costs associated with originating a loan. Direct loan origination costs of a completed loan shall include only the following: Incremental direct costs of loan origination incurred in transactions with independent third parties for that loan Certain costs directly related to specified activities performed by the lender for that loan. Those activities include all of the following: Evaluating the prospective borrower's financial condition Evaluating and recording guarantees, collateral, and other security arrangements Negotiating loan terms Preparing and processing loan documents Closing the transaction. The costs directly related to those activities shall include only that portion of the employees' total compensation and payroll-related fringe benefits directly related to time spent performing those activities for that loan and other costs related to those activities that would not have been incurred but for that loan. See Section 310-20-55 for examples of items.
Used in 1 subtopic:310-20
disclosure statement
A written statement containing information approved as adequate by the court. It is required to be presented by a party before soliciting the acceptance or rejection of a plan of reorganization from creditors and stockholders affected by the plan. Adequate information means information of a kind, and in sufficient detail, as far as is reasonably practicable in light of the nature and history of the debtor and the condition of the debtor's records, that would enable a hypothetical reasonable investor typical of holders of claims or interests of the relevant class to make an informed judgment about the plan.
Used in 1 subtopic:852-10
discount
The difference between the net proceeds, after expense, received upon issuance of debt and the amount repayable at its maturity. See Premium.
Used in 1 subtopic:835-30
Discount Rate
A rate or rates used to reflect the time value of money. Discount rates are used in determining the present value as of the measurement date of future cash flows currently expected to be required to satisfy the pension obligation or other postretirement benefit obligation. See Actuarial Present Value.
discount rate adjustment technique
A present value technique that uses a risk-adjusted discount rate and contractual, promised, or most likely cash flows.
Discount Rate for the Lease
For a lessee, the discount rate for the lease is the rate implicit in the lease unless that rate cannot be readily determined. In that case, the lessee is required to use its incremental borrowing rate. For a lessor, the discount rate for the lease is the rate implicit in the lease.
disposal
Related to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 and the Resource Conservation and Recovery Act of 1976: under the Resource Conservation and Recovery Act of 1976, the discharge, deposit, injection, dumping, spilling, leaking, or placing of any solid waste or hazardous waste into or on any land or water so that such solid waste or hazardous waste or any constituent thereof may enter the environment or be emitted into the air or discharged into any waters, including groundwaters. Similarly under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 with regard to hazardous substances.
Disposal Group
A disposal group for a long-lived asset or assets to be disposed of by sale or otherwise represents assets to be disposed of together as a group in a single transaction and liabilities directly associated with those assets that will be transferred in the transaction. A disposal group may include a discontinued operation along with other assets and liabilities that are not part of the discontinued operation.
distribution costs
Costs, as defined in a distribution agreement between a distributor and a fund, incurred by a distributor in distributing a fund's shares. Such costs may include commission payments to sales representatives, promotional materials, overhead allocations, and interest.
Used in 1 subtopic:946-20
distribution-form demutualization
A situation in which eligible policyholders receive stock, policy credits, additional policyholder benefits, cash, or rights to purchase stock at favorable terms.
Used in 1 subtopic:805-944
distributor
Usually the principal underwriter that sells the fund's capital shares by acting as an agent (intermediary between the fund and an independent dealer or the public) or as a principal, buying capital shares from the fund at net asset value and selling shares through dealers or to the public (see definition of underwriter in section 2(a)(40) of the Investment Company Act of 1940).
Used in 1 subtopic:946-20
dividend fund interest rate
The interest rate determined at policy issuance used to determine the amount of the dividend fund. It is the rate used to credit interest to the dividend fund, and against which experience is measured to determine the amount of the interest portion of dividends paid to individual policyholders.
Used in 1 subtopic:944-40
dividend scales
The actuarial formulas used by life insurance entities to determine amounts payable as dividends on participating policies based on experience factors relating, among other things, to investment results, mortality, lapse rates, expenses, premium taxes, and policy loan interest.
Dividend to Policyholders
Nonguaranteed amounts distributable to policyholders of participating life insurance contracts and based on actual performance of the insurance entity as determined by the insurer. Under various state insurance laws, dividends are apportioned to policyholders on an equitable basis. The dividend allotted to any contract often is based on the amount that the contract, as one of a class of similar contracts, has contributed to the income available for distribution as dividends. Dividends to policyholders include annual policyholder dividends and terminal dividends.
dividends
Dividends paid or payable in cash, other assets, or another class of stock and does not include stock dividends or stock splits.
Used in 1 subtopic:323-10
dollar-roll repurchase agreement
An agreement to sell and repurchase similar but not identical securities. The securities sold and repurchased are usually of the same issuer. Dollar rolls differ from regular repurchase agreements in that the securities sold and repurchased have all of the following characteristics: They are represented by different certificates. They are collateralized by different but similar mortgage pools (for example, conforming single-family residential mortgages). They generally have different principal amounts. Fixed coupon and yield maintenance dollar agreements comprise the most common agreement variations. In a fixed coupon agreement, the seller and buyer agree that delivery will be made with securities having the same stated interest rate as the interest rate stated on the securities sold. In a yield maintenance agreement, the parties agree that delivery will be made with securities that will provide the seller a yield that is specified in the agreement.
Used in 1 subtopic:860-10
Donor-Imposed Condition
A donor stipulation (donors include other types of contributors, including makers of certain grants) that represents a barrier that must be overcome before the recipient is entitled to the assets transferred or promised. Failure to overcome the barrier gives the contributor a right of return of the assets it has transferred or gives the promisor a right of release from its obligation to transfer its assets.
Used in 25 subtopics:205-954205-958220-954220-958230-10230-958+6 more
Donor-Imposed Restriction
A donor stipulation (donors include other types of contributors, including makers of certain grants) that specifies a use for a contributed asset that is more specific than broad limits resulting from the following: The nature of the not-for-profit entity (NFP) The environment in which it operates The purposes specified in its articles of incorporation or bylaws or comparable documents for an unincorporated association. Some donors impose restrictions that are temporary in nature, for example, stipulating that resources be used after a specified date, for particular programs or services, or to acquire buildings or equipment. Other donors impose restrictions that are perpetual in nature, for example, stipulating that resources be maintained in perpetuity. Laws may extend those limits to investment returns from those resources and to other enhancements (diminishments) of those resources. Thus, those laws extend donor-imposed restrictions.
Used in 18 subtopics:205-958210-954210-958220-954220-958230-10+6 more
Donor-Restricted Endowment Fund
An endowment fund that is created by a donor stipulation (donors include other types of contributors, including makers of certain grants) requiring investment of the gift in perpetuity or for a specified term. Some donors or laws may require that a portion of income, gains, or both be added to the gift and invested subject to similar restrictions. The term does not include a Board-Designated Endowment Fund. See Endowment Fund.
Used in 7 subtopics:205-958210-958220-958230-10320-958605-958+1 more
Donor-Restricted Support
Donor-restricted revenues or gains from contributions that increase net assets with donor restrictions (donors include other types of contributors, including makers of certain grants).
Used in 6 subtopics:205-958220-958360-958605-958805-958958-30
Down Round Feature
A feature in a financial instrument that reduces the strike price of an issued financial instrument if the issuer sells shares of its stock for an amount less than the currently stated strike price of the issued financial instrument or issues an equity-linked financial instrument with a strike price below the currently stated strike price of the issued financial instrument. A down round feature may reduce the strike price of a financial instrument to the current issuance price, or the reduction may be limited by a floor or on the basis of a formula that results in a price that is at a discount to the original exercise price but above the new issuance price of the shares, or may reduce the strike price to below the current issuance price. A standard antidilution provision is not considered a down round feature.
downgrade
A transaction under which, as a result of credit concerns, the holder of a time-sharing interval returns the interval to the seller in exchange for a lower-valued interval (and a corresponding reduction in contractual payment obligation). The determination of whether the value is lower is based on a comparison of the sales value of the new interval with the original sales value of the original interval.
Used in 1 subtopic:310-978
e
earnings or losses of an investee
Net income (or net loss) of an investee determined in accordance with U.S. generally accepted accounting principles (GAAP).
Used in 1 subtopic:323-10
earnings protection benefit
A feature of an annuity under which, in the event of death, the beneficiary will receive a benefit in addition to the account balance equal to a percentage (for example, 40 percent) of the difference between the account balance and the deposits less withdrawals.
Used in 1 subtopic:944-20
Economic Interest
A not-for-profit entity's (NFP's) interest in another entity that exists if any of the following criteria are met: The other entity holds or utilizes significant resources that must be used for the purposes of the NFP, either directly or indirectly by producing income or providing services. The NFP is responsible for the liabilities of the other entity. See paragraph 958-810-55-6 for examples of economic interests.
economic interest in the entity
Any type or form of pecuniary interest or arrangement that an entity could issue or be a party to, including equity securities; financial instruments with characteristics of equity, liabilities, or both; long-term debt and other debt-financing arrangements; leases; and contractual arrangements such as management contracts, service contracts, or intellectual property licenses.
Used in 1 subtopic:718-10
Economic Life
Either the period over which an asset is expected to be economically usable by one or more users or the number of production or similar units expected to be obtained from an asset by one or more users.
Used in 1 subtopic:842-10
Effective Date of the Modification
The date that a lease modification is approved by both the lessee and the lessor.
Used in 1 subtopic:842-10
Effective Interest Rate
The rate of return implicit in the financial asset, that is, the contractual interest rate adjusted for any net deferred fees or costs, premium, or discount existing at the origination or acquisition of the financial asset. For purchased financial assets with credit deterioration, however, to decouple interest income from credit loss recognition, the premium or discount at acquisition excludes the discount embedded in the purchase price that is attributable to the acquirer's assessment of credit losses at the date of acquisition.
Used in 8 subtopics:230-10310-10310-20310-30310-40326-10+2 more
effective notional amount
The effective notional amount is the stated notional amount adjusted for any leverage factor.
electronic tickets
An electronic (or e-ticket) reflects the passenger's itinerary in electronic form. Like paper tickets, e-tickets contain information for each flight segment of a passenger's itinerary. However, while a paper ticket consists of multiple coupons that are used to record a sale and to document the service rendered, e-tickets exist only as a digital record in the airline computer system and contain no paper coupons. Instead, the airline's host reservation system or global distribution system (GDS) produces an e-ticket sales record for each sale transaction, which is used to record a sale of e-ticket. Boarding documents are issued for e-tickets at check-in, and the carrier documents transportation service at the boarding point by either collecting boarding documents or scanning them as evidence of the service rendered.
Used in 1 subtopic:908-10
embedded call option
A call option held by the issuer of a financial instrument that is part of and trades with the underlying instrument. For example, a bond may allow the issuer to call it by posting a public notice well before its stated maturity that asks the current holder to submit it for early redemption and provides that interest ceases to accrue on the bond after the early redemption date. Rather than being an obligation of the initial purchaser of the bond, an embedded call option trades with and diminishes the value of the underlying bond.
Used in 1 subtopic:860-10
Embedded Credit Derivative
An embedded derivative that is also a credit derivative.
embedded derivative
Implicit or explicit terms that affect some or all of the cash flows or the value of other exchanges required by a contract in a manner similar to a derivative instrument.
emerging entity
An entity (sometimes referred to as the reorganized entity), that has had its plan confirmed and begins to operate as a new entity.
Used in 1 subtopic:852-10
employee
A person who has rendered or is presently rendering service.
Used in 9 subtopics:205-960220-40718-10718-20718-30718-40+3 more
Employee Compensation
(P) December 16, 2026; (N) December 16, 2026220-40-65-1All forms of cash consideration (including deferred cash compensation), share-based payment arrangements, medical care benefits, pension benefits, postretirement benefits, and nonretirement postemployment benefits (including special or contractual termination benefits) given by an entity in exchange for service rendered by employees or for the termination of employment. This includes compensation cost arising from wages, salaries, profit-sharing, bonuses, one-time employee termination benefits, other postemployment benefits, employee stock ownership plans, employee share purchase plans, defined contribution plans, multiemployer plans, and any other compensation cost recognized in accordance with the guidance in Topic 710 on compensation, Topic 712 on nonretirement postemployment benefits, Topic 715 on retirement benefits, and Topic 718 on stock compensation. This also includes compulsory payments paid to the general government that confer entitlement to receive a (contingent) future social benefit, such as unemployment insurance benefits and supplements; accident, injury, and sickness benefits; old-age, disability, and survivors’ pensions; and family allowances, reimbursements for medical and hospital expenses, or provision of hospital or medical services. For defined benefit plans within the scope of Topic 715, employee compensation includes only the service cost component of net periodic pension cost and the service cost component of net periodic postretirement benefit cost.
Used in 1 subtopic:220-40
Employee Stock Ownership Plan
An employee stock ownership plan is an employee benefit plan that is described by the Employee Retirement Income Security Act of 1974 and the Internal Revenue Code of 1986 as a stock bonus plan, or combination stock bonus and money purchase pension plan, designed to invest primarily in employer stock. Also called an employee share ownership plan.
employer loan
An employer loan is a loan made by the employer to the employee stock ownership plan, with no related outside loan.
Used in 1 subtopic:718-40
endeavor
The activity that participants in a collaborative arrangement collaborate on. For example, in a biotechnology or pharmaceutical environment the endeavor may be the development and commercialization of a drug candidate. In the entertainment industry, it may be production and distribution of a motion picture.
Used in 1 subtopic:808-10
endorsement split-dollar life insurance
A split-dollar life insurance arrangement in which the entity owns and controls the insurance policy. The employer enters into a separate agreement that splits the policy benefits between the employer and the employee. The employer owns the policy, controls all rights of ownership, and may terminate the insurance policy (and, in turn, the policy benefits promised to the employee). To effect the split-dollar arrangement, the employer endorses a portion of the death benefits to the employee (the employee designates a beneficiary for this portion of the death benefits). Upon the death of the employee, the employee's beneficiary typically receives the designated portion of the death benefits directly from the insurance entity and the employer receives the remainder of the death benefits.
Used in 1 subtopic:715-60
Endowment contracts
An insurance contract that provides insurance from inception of the contract to the maturity date (endowment period). The contract specifies that a stated amount, adjusted for items such as policy loans and dividends, if any, will be paid to the beneficiary if the insured dies before the maturity date. If the insured is still living at the maturity date, the policyholder will receive the maturity amount under the contract after adjustments, if any. Endowment contracts generally mature at a specified age of the insured or at the end of a specified period.
Used in 1 subtopic:944-20
Endowment Fund
An established fund of cash, securities, or other assets to provide income for the maintenance of a not-for-profit entity (NFP). The use of the assets of the fund may be with or without donor-imposed restrictions. Endowment funds generally are established by donor-restricted gifts and bequests to provide a source of income in perpetuity or for a specified period. See Donor-Restricted Endowment Fund. Alternatively, an NFP's governing board may earmark a portion of its net assets as a Board-Designated Endowment Fund. See Funds Functioning as Endowment.
Used in 7 subtopics:205-958210-958220-958230-10320-958605-958+1 more
enhanced 12b-1 plan
A reimbursement 12b-1 plan that provides that, on termination of the plan, the fund is required to continue paying the 12b-1 fee to the extent the distributor has excess costs.
Used in 1 subtopic:946-20
Enhanced-Crediting-Rate Bonus
A sales inducement in which the insurance entity offers customers a crediting rate for a stated period in excess of that currently being offered for other similar contracts.
entry price
The price paid to acquire an asset or received to assume a liability in an exchange transaction.
Used in 1 subtopic:820-10
Environmental Credit
(P) December 16, 2027; (N) December 16, 2028818-10-65-1An enforceable right that is acquired, internally generated, granted by a regulatory agency or its designee(s), or received in a nonreciprocal transfer that is not a grant from a regulator or its designee(s) that meets all of the following criteria:Lacks physical substance and is not a financial asset.Is represented to prevent, control, reduce, or remove emissions or other pollution.Is, or previously was, separately transferable in an exchange transaction. If an item is no longer separately transferable in an exchange transaction, an entity must be able to use that item to satisfy an environmental credit obligation to meet this criterion.Is not an income tax credit that may be used to settle an entity’s income tax liability, regardless of whether the entity has a tax liability or intends to use the credit for that purpose.An environmental credit that meets the above criteria may exist in a variety of forms, including (but not limited to) credits, certificates, allowances, and offsets.
Used in 11 subtopics:220-40350-10405-20605-958805-20815-10+5 more
Environmental Credit Obligation
(P) December 16, 2027; (N) December 16, 2028818-10-65-1A regulatory compliance obligation arising from existing or enacted laws, statutes, or ordinances represented to prevent, control, reduce, or remove emissions or other pollution that may be settled with environmental credits. Obligations within the scope of Subtopic 410-30 are not environmental credit obligations.
Used in 11 subtopics:220-40350-10405-20605-958805-20815-10+5 more
equitable right of redemption
The right of a property owner who has defaulted on a secured obligation to recover the securing property before its sale by paying the amounts due and any appropriate fees and charges. Other creditors of or a receiver for the property owner also may be able to exercise that right. After a transfer of a financial asset, a right of redemption may allow the transferor to buy back the transferred asset.
Used in 1 subtopic:860-10
Equity Interests
Used broadly to mean ownership interests of investor-owned entities; owner, member, or participant interests of mutual entities; and owner or member interests in the net assets of not-for-profit entities.
Equity Restructuring
A nonreciprocal transaction between an entity and its shareholders that causes the per-share fair value of the shares underlying an option or similar award to change, such as a stock dividend, stock split, spinoff, rights offering, or recapitalization through a large, nonrecurring cash dividend.
Equity Security
Any security representing an ownership interest in an entity (for example, common, preferred, or other capital stock) or the right to acquire (for example, warrants, rights, forward purchase contracts, and call options) or dispose of (for example, put options and forward sale contracts) an ownership interest in an entity at fixed or determinable prices. The term equity security does not include any of the following: Written equity options (because they represent obligations of the writer, not investments) Cash-settled options on equity securities or options on equity-based indexes (because those instruments do not represent ownership interests in an entity) Convertible debt or preferred stock that by its terms either must be redeemed by the issuing entity or is redeemable at the option of the investor.
Equity Transfer
An equity transfer is nonreciprocal. An equity transfer is a transaction directly between a transferor and a transferee. Equity transfers are similar to ownership transactions between a for-profit parent and its owned subsidiary (for example, additional paid-in capital or dividends). However, equity transfers can occur only between related not-for-profit entities (NFPs) if one controls the other or both are under common control. An equity transfer embodies no expectation of repayment, nor does the transferor receive anything of immediate economic value (such as a financial interest or ownership).
Equity-indexed annuity
A deferred fixed annuity contract with a guaranteed minimum interest rate plus a contingent return based on some internal or external equity index, such as the Standard and Poor's S&P 500 Index.
Used in 1 subtopic:815-15
error in previously issued financial statements
An error in recognition, measurement, presentation, or disclosure in financial statements resulting from mathematical mistakes, mistakes in the application of generally accepted accounting principles (GAAP), or oversight or misuse of facts that existed at the time the financial statements were prepared. A change from an accounting principle that is not generally accepted to one that is generally accepted is a correction of an error.
Used in 1 subtopic:250-10
estimated current value
For an asset, the amount at which the item could be exchanged between a buyer and seller, each of whom is well informed and willing, and neither of whom is compelled to buy or sell.
Used in 1 subtopic:274-10
Estimated Residual Value
The estimated fair value of the leased property at the end of the lease term.
Used in 1 subtopic:842-50
event
A happening of consequence to an entity. The term encompasses both transactions and other events affecting an entity.
excess costs
The cumulative distribution costs incurred by the distributor less the sum of cumulative 12b-1 fees paid, cumulative contingent-deferred sales load payments, and future cumulative contingent-deferred sales load payments by current shareholders, if reasonably estimable.
Used in 1 subtopic:946-20
Exchange
An exchange (or exchange transaction) is a reciprocal transfer between two entities that results in one of the entities acquiring assets or services or satisfying liabilities by surrendering other assets or services or incurring other obligations.
Used in 13 subtopics:220-40350-10405-20605-958805-20805-958+6 more
Exchange Market
A market in which closing prices are both readily available and generally representative of fair value. An example of such a market is the New York Stock Exchange.
Used in 1 subtopic:820-10
exchange rate
The ratio between a unit of one currency and the amount of another currency for which that unit can be exchanged at a particular time.
executive officers
See paragraph 942-210-S99-1, Regulation S-X Rule 9-03(7)(e)(4), for the definition of executive officers for the purpose of Regulation S-X Rule 9-03.
Used in 1 subtopic:210-942
exempt and nonexempt cooperatives
Cooperatives classified according to their federal income tax status. Both types are permitted to deduct from taxable income patronage distributed or allocated on a qualified basis to patrons to the extent that the distributions represent earnings of the cooperative derived from business done with or for the patrons. In addition, cooperatives meeting the requirements of Internal Revenue Code section 521 (exempt cooperatives) are permitted to deduct limited amounts paid as dividends on capital stock and distributions to patrons of income from business done with the U.S. government or its agencies and income from nonpatronage sources.
Used in 1 subtopic:905-10
exercise contingency
A provision that entitles the entity (or the counterparty) to exercise an equity-linked financial instrument (or embedded feature) based on changes in an underlying, including the occurrence (or nonoccurrence) of a specified event. Provisions that accelerate the timing of the entity's (or the counterparty's) ability to exercise an instrument and provisions that extend the length of time that an instrument is exercisable are examples of exercise contingencies.
Used in 1 subtopic:815-40
exercise price
The amount that must be paid for a share of common stock upon exercise of an option or warrant.
Used in 1 subtopic:260-10
existing contract
A contract that is currently held by the contract holder and excludes nonintegrated contract features.
exit price
The price that would be received to sell an asset or paid to transfer a liability.
Used in 1 subtopic:820-10
Expected Cash Flow
The probability-weighted average (that is, mean of the distribution) of possible future cash flows.
Expected Long-Term Rate of Return on Plan Assets
An assumption about the rate of return on plan assets reflecting the average rate of earnings expected on existing plan assets and expected contributions to the plan during the period.
expected losses
A legal entity that has no history of net losses and expects to continue to be profitable in the foreseeable future can be a variable interest entity (VIE). A legal entity that expects to be profitable will have expected losses. A VIE's expected losses are the expected negative variability in the fair value of its net assets exclusive of variable interests and not the anticipated amount or variability of the net income or loss.
Used in 1 subtopic:810-10
Expected Losses and Expected Residual Returns
Expected losses and expected residual returns refer to amounts derived from expected cash flows as described in FASB Concepts Statement No. 7, Using Cash Flow Information and Present Value in Accounting Measurements. However, expected losses and expected residual returns refer to amounts discounted and otherwise adjusted for market factors and assumptions rather than to undiscounted cash flow estimates. The definitions of expected losses and expected residual returns specify which amounts are to be considered in determining expected losses and expected residual returns of a variable interest entity (VIE). (P) December 16, 2024; (N) December 16, 2025 105-10-65-9 Expected losses and expected residual returns refer to amounts derived from expected cash flows. However, expected losses and expected residual returns refer to amounts discounted and otherwise adjusted for market factors and assumptions rather than to undiscounted cash flow estimates. The definitions of expected losses and expected residual returns specify which amounts are to be considered in determining expected losses and expected residual returns of a variable interest entity (VIE). A computation of expected losses, expected residual returns, and expected variability is illustrated in paragraphs 810-10-55-42810-10-55-43810-10-55-44810-10-55-45810-10-55-46810-10-55-47810-10-55-48810-10-55-49.
Used in 1 subtopic:810-10
expected postretirement benefit obligation
The actuarial present value as of a particular date of the postretirement benefits expected to be paid by the employer's plan to or for each employee, the employee's beneficiaries, and any covered dependents pursuant to the terms of the plan.
Used in 1 subtopic:715-60
expected residual profit
The amount of profit, whether called interest or another name, such as equity kicker, above a reasonable amount of interest and fees expected to be earned by a lender.
expected residual returns
A variable interest entity's (VIE's) expected residual returns are the expected positive variability in the fair value of its net assets exclusive of variable interests.
Used in 1 subtopic:810-10
Expected Return on Plan Assets
An amount calculated as a basis for determining the extent of delayed recognition of the effects of changes in the fair value of plan assets. The expected return on plan assets is determined based on the expected long-term rate of return on plan assets and the market-related value of plan assets.
expected variability
Expected variability is the sum of the absolute values of the expected residual return and the expected loss. Expected variability in the fair value of net assets includes expected variability resulting from the operating results of the legal entity.
Used in 1 subtopic:810-10
Expendable parts
Parts that are ordinarily used up (consumed) and replaced with new parts, as opposed to those parts that are capable of being used over and over after being refurbished (rotable flight equipment).
Used in 1 subtopic:330-908
expenditures
Expenditures to which capitalization rates are to be applied are capitalized expenditures (net of progress payment collections) for the qualifying asset that have required the payment of cash, the transfer of other assets, or the incurring of a liability on which interest is recognized (in contrast to liabilities, such as trade payables, accruals, and retainages on which interest is not recognized).
Used in 1 subtopic:835-20
experience adjustments
A provision in an insurance or reinsurance contract that modifies the premium, coverage, commission, or a combination of the three, in whole or in part, based on experience under the contract.
Used in 1 subtopic:340-30
explicit
A service period that is explicitly stated in the terms of a share-based payment award. For example, an award stating that it vests after three years of continuous employee service from a given date (usually the grant date) has an explicit service period of three years. See Derived Service Period, Implicit Service Period, and Requisite Service Period.
explicit approach to assumptions
An approach under which each significant assumption used reflects the best estimate of the plan's future experience solely with respect to that assumption. See Implicit Approach to Assumptions.
exploitation costs
All direct costs (including marketing, advertising, publicity, promotion, and other distribution expenses) incurred in connection with the distribution of a film.
exploration
Exploration involves both of the following: Identifying areas that may warrant examination Examining specific areas that are considered to have prospects of containing oil and gas reserves, including drilling exploratory wells and exploratory-type stratigraphic test wells.
Used in 7 subtopics:235-932360-932470-932720-932810-932835-932+1 more
exploration costs
See paragraph 932-10-S99-1, Regulation S-X Rule 4-10(a)(12), for the definition of exploration costs as used within that Rule.
Exploratory Well
An exploratory well is a well drilled to find a new field or to find a new reservoir in a field previously found to be productive of oil or gas in another reservoir. Generally, an exploratory well is any well that is not a development well, a service well , or a stratigraphic test well.
extended warranty
An agreement to provide warranty protection in addition to the scope of coverage of the manufacturer's original warranty, if any, or to extend the period of coverage provided by the manufacturer's original warranty.
Used in 1 subtopic:605-20
f
fail-to-deliver
A fail-to-deliver is a securities sale to another broker-dealer that has not been delivered to the buying broker-dealer by the close of business on the settlement date.
fail-to-receive
A fail-to-receive is a securities purchase from another broker-dealer not received from the selling broker-dealer by the close of business on the settlement date.
Fair Value
The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
Used in 100 subtopics:205-30205-946205-965210-946220-40230-10+6 more
fair value hedge
A hedge of the exposure to changes in the fair value of a recognized asset or liability, or of an unrecognized firm commitment, that are attributable to a particular risk.
Fed Funds Effective Rate Overnight Index Swap Rate
The fixed rate on a U.S. dollar, constant-notional interest rate swap that has its variable-rate leg referenced to the Fed Funds Effective Rate (an overnight rate) with no additional spread over the Fed Funds effective rate on that variable-rate leg. That fixed rate is the derived rate that would result in the swap having a zero fair value at inception because the present value of fixed cash flows, based on that rate, equates to the present value of the variable cash flows.
Used in 1 subtopic:815-20
Fed Funds Effective Rate Overnight Index Swap Rate
The fixed rate on a U.S. dollar, constant-notional interest rate swap that has its variable-rate leg referenced to the Fed Funds effective rate with no additional spread over the Fed Funds effective rate on that variable-rate leg. That fixed rate is the derived rate that would result in the swap having a zero fair value at inception because the present value of fixed cash flows, based on that rate, equates to the present value of the variable cash flows. (P) December 16, 2018; (N) December 16, 2020815-20-65-4Glossary term superseded by Accounting Standards Update No. 2018-16.
Used in 1 subtopic:815-20
Federal Home Loan Mortgage Corporation
Often referred to as Freddie Mac, FHLMC is a private corporation authorized by Congress to assist in the development and maintenance of a secondary market in conventional residential mortgages. FHLMC purchases mortgage loans and sells mortgages principally through mortgage participation certificates representing an undivided interest in a group of conventional mortgages. FHLMC guarantees the timely payment of interest and the collection of principal on the participation certificates.
Federal National Mortgage Association
Often referred to as Fannie Mae, FNMA is an investor-owned corporation established by Congress to support the secondary mortgage loan market by purchasing mortgage loans when other investor funds are limited and selling mortgage loans when other investor funds are available.
field
A field is an area consisting of a single reservoir or multiple reservoirs all grouped on or related to the same individual geological structural feature and/or stratigraphic condition. There may be two or more reservoirs in a field which are separated vertically by intervening impervious strata, or laterally by local geologic barriers, or by both. Reservoirs that are associated by being in overlapping or adjacent fields may be treated as a single or common operational field. The geological terms structural feature and stratigraphic condition are intended to identify localized geological features as opposed to the broader terms of basins, trends, provinces, plays, areas-of-interest, and so forth.
Used in 1 subtopic:360-932
Field and row crops
Field and row crops are usually planted from seeds or are transplanted from beds and develop to the point of harvest within several months.
Used in 1 subtopic:330-905
Film Costs
Film costs include all direct negative costs incurred in the physical production of a film, as well as allocations of production overhead and capitalized interest in accordance with Topic 835. Examples of direct negative costs include costs of story and scenario; compensation of cast, directors, producers, extras, and miscellaneous staff; costs of set construction and operations, wardrobe, and accessories; costs of sound synchronization; rental facilities on location; and postproduction costs such as music, special effects, and editing.
Film Group
The unit of account used for impairment testing for a film or a license agreement for program material when the film or license agreement is expected to be predominantly monetized with other films and/or license agreements instead of being predominantly monetized on its own. A film group represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other films and/or license agreements.
film prints
Those materials, produced on behalf of a film distributor for delivery to a theater or other similar venue, that contain the completed audio and video elements of a film. Such materials are used by the theater or other similar venue to exhibit the film to its customers.
Used in 1 subtopic:705-926
films
Feature films, television specials, television series, or similar products (including animated films and television programming) that are sold, licensed, or exhibited, whether produced on film, video tape, digital, or other video recording format.
final-pay
A benefit formula that bases benefits on the employee's compensation over a specified number of years near the end of the employee's service period or on the employee's highest compensation periods. For example, a plan might provide annual pension benefits equal to 1 percent of the employee's average salary for the last 5 years (or the highest consecutive 5 years) for each year of service. A final-pay plan is a plan with such a formula.
Used in 1 subtopic:715-30
Finance Lease
From the perspective of a lessee, a lease that meets one or more of the criteria in paragraph 842-10-25-2.
Used in 10 subtopics:220-40340-970450-30805-20810-10835-20+4 more
Financial Asset
Cash, evidence of an ownership interest in an entity, or a contract that conveys to one entity a right to do either of the following: Receive cash or another financial instrument from a second entity Exchange other financial instruments on potentially favorable terms with the second entity.
Used in 33 subtopics:220-40230-10230-958270-10310-10310-20+6 more
financial flexibility
The ability of an entity to take effective actions to alter amounts and timing of cash flows so it can respond to unexpected needs and opportunities.
financial guarantee insurance contracts
A contract issued by an insurance entity that provides protection to the holder of a financial obligation from a financial loss in the event of a default. Specifically, a contract that obligates the insurance entity to pay a claim upon the occurrence of an event of default. The event of a default (insured event) refers to nonpayment (when due) of insured contractual payments (generally principal and interest) by the issuer of the insured financial obligation.
financial guarantee reinsurance contracts
See Financial Guarantee Insurance Contract
financial highlights
Nonregistered investment partnerships, when disclosing financial highlights, shall interpret the terms classes, units, and theoretical investments as follows: Classes. Nonregistered investment funds typically have one of the following two classes of ownership interest, with one class being the management interest in the fund and the other being the investment interest: For unitized funds (that is, funds with units specifically called for in the governing underlying legal or offering documents), the management interest usually is a voting class and the investment interest is a nonvoting class. Temporary series of shares (that is, shares that are intended at the time of issuance to be consolidated at a later date with another specified series of shares that remains outstanding indefinitely) are not considered separate classes. Permanent series of a class of share shall be the basis for which that share's financial highlights are determined and presented. For nonunitized funds, the management interest usually is the general partner class and the investment interest usually is the limited partner class. Generally, a class has certain rights as governed by underlying legal documents or offering documents and local law. Rights to certain investments that do not otherwise affect the rights available under the underlying legal documents and local law do not ordinarily represent a separate share class. For example, rights to income and gains from a specific investment attributed solely to investors at the date the investment is made (side-pocket investments) are not considered to give rise to a share class. Similarly, a temporary series of shares is not considered a share class. Units. Only funds with units specifically called for in the governing underlying legal or offering documents shall be considered unitized. Some funds may employ units for convenience in making allocations to investors for internal accounting or bookkeeping purposes, but the units are not required or specified by legal or offering documents, and for all other purposes operate like nonunitized investment partnerships. For per-share operating performance, those funds are not considered unitized. Theoretical investment. The term theoretical investment in paragraph 946-205-50-20 shall be considered as the actual aggregate amount of capital invested by each reporting class of investor as of the beginning of the fiscal reporting period, adjusted for cash flows related to capital contributions or withdrawals during the period.
Used in 1 subtopic:205-946
Financial Instrument
Cash, evidence of an ownership interest in an entity, or a contract that both: Imposes on one entity a contractual obligation either: To deliver cash or another financial instrument to a second entity To exchange other financial instruments on potentially unfavorable terms with the second entity. Conveys to that second entity a contractual right either: To receive cash or another financial instrument from the first entity To exchange other financial instruments on potentially favorable terms with the first entity. The use of the term financial instrument in this definition is recursive (because the term financial instrument is included in it), though it is not circular. The definition requires a chain of contractual obligations that ends with the delivery of cash or an ownership interest in an entity. Any number of obligations to deliver financial instruments can be links in a chain that qualifies a particular contract as a financial instrument. Contractual rights and contractual obligations encompass both those that are conditioned on the occurrence of a specified event and those that are not. All contractual rights (contractual obligations) that are financial instruments meet the definition of asset (liability) set forth in FASB Concepts Statement No. 6, Elements of Financial Statements, although some may not be recognized as assets (liabilities) in financial statements—that is, they may be off-balance-sheet—because they fail to meet some other criterion for recognition. For some financial instruments, the right is held by or the obligation is due from (or the obligation is owed to or by) a group of entities rather than a single entity. (P) December 16, 2024; (N) December 16, 2025105-10-65-9Cash, evidence of an ownership interest in an entity, or a contract that both: Imposes on one entity a contractual obligation either: To deliver cash or another financial instrument to a second entity To exchange other financial instruments on potentially unfavorable terms with the second entity. Conveys to that second entity a contractual right either: To receive cash or another financial instrument from the first entity To exchange other financial instruments on potentially favorable terms with the first entity. The use of the term financial instrument in this definition is recursive (because the term financial instrument is included in it), though it is not circular. The definition requires a chain of contractual obligations that ends with the delivery of cash or an ownership interest in an entity. Any number of obligations to deliver financial instruments can be links in a chain that qualifies a particular contract as a financial instrument. Contractual rights and contractual obligations encompass both those that are conditioned on the occurrence of a specified event and those that are not. Some contractual rights (contractual obligations) that are financial instruments may not be recognized in financial statements—that is, they may be off-balance-sheet—because they fail to meet some other criterion for recognition. For some financial instruments, the right is held by or the obligation is due from (or the obligation is owed to or by) a group of entities rather than a single entity.
Used in 16 subtopics:235-10260-10325-954480-10505-10815-10+6 more
Financial Liability
A contract that imposes on one entity an obligation to do either of the following:Deliver cash or another financial instrument to a second entity Exchange other financial instruments on potentially unfavorable terms with the second entity.
financial standby letters of credit
An irrevocable undertaking (typically by a financial institution) to guarantee payment of a specified financial obligation.
Used in 1 subtopic:460-10
Financial Statements Are Available to Be Issued
Financial statements are considered available to be issued when they are complete in a form and format that complies with GAAP and all approvals necessary for issuance have been obtained, for example, from management, the board of directors, and/or significant shareholders. The process involved in creating and distributing the financial statements will vary depending on an entity's management and corporate governance structure as well as statutory and regulatory requirements.
Used in 9 subtopics:105-10205-40326-20805-20805-50810-10+3 more
Financial Statements Are Issued
Financial statements are considered issued when they are widely distributed to shareholders and other financial statement users for general use and reliance in a form and format that complies with GAAP. (U.S. Securities and Exchange Commission [SEC] registrants also are required to consider the guidance in paragraph 855-10-S99-2.)
financing activities
Financing activities include obtaining resources from owners and providing them with a return on, and a return of, their investment; receiving restricted resources that by donor stipulation must be used for long-term purposes; borrowing money and repaying amounts borrowed, or otherwise settling the obligation; and obtaining and paying for other resources obtained from creditors on long-term credit.
Used in 1 subtopic:230-10
Financing Receivable
A financing arrangement that has both of the following characteristics: It represents a contractual right to receive money in either of the following ways: On demand On fixed or determinable dates. It is recognized as an asset in the entity's statement of financial position. See paragraphs 310-10-55-13310-10-55-14310-10-55-15 for more information on the definition of financing receivable, including a list of items that are excluded from the definition (for example, debt securities).
firm commitment
An agreement with an unrelated party, binding on both parties and usually legally enforceable, with the following characteristics:The agreement specifies all significant terms, including the quantity to be exchanged, the fixed price, and the timing of the transaction. The fixed price may be expressed as a specified amount of an entity's functional currency or of a foreign currency. It may also be expressed as a specified interest rate or specified effective yield. The binding provisions of an agreement are regarded to include those legal rights and obligations codified in the laws to which such an agreement is subject. A price that varies with the market price of the item that is the subject of the firm commitment cannot qualify as a fixed price. For example, a price that is specified in terms of ounces of gold would not be a fixed price if the market price of the item to be purchased or sold under the firm commitment varied with the price of gold. The agreement includes a disincentive for nonperformance that is sufficiently large to make performance probable. In the legal jurisdiction that governs the agreement, the existence of statutory rights to pursue remedies for default equivalent to the damages suffered by the nondefaulting party, in and of itself, represents a sufficiently large disincentive for nonperformance to make performance probable for purposes of applying the definition of a firm commitment.
Firm Purchase Commitment
A firm purchase commitment is an agreement with an unrelated party, binding on both parties and usually legally enforceable, that meets both of the following conditions: It specifies all significant terms, including the price and timing of the transaction. It includes a disincentive for nonperformance that is sufficiently large to make performance probable.
Fiscal Funding Clause
A provision by which the lease is cancelable if the legislature or other funding authority does not appropriate the funds necessary for the governmental unit to fulfill its obligations under the lease agreement.
Used in 1 subtopic:842-10
Fixed participation method
Liquidation method used to allocate principal payments on the receivables in a trust to the investors, under which all principal payments on the receivables in the trust are allocated to the investors based on their respective participation interests in the credit card receivables in the trust at the end of the reinvestment period.
Used in 1 subtopic:860-10
fixed time
A time-sharing arrangement in which ownership is passed through a deed and the buyer purchases a specific period (generally, a specific week) during the year.
Used in 1 subtopic:978-10
fixed-price contract
A fixed-price or lump-sum contract is a contract in which the price is not usually subject to adjustment because of costs incurred by the contractor. See also the following common variations of fixed-price contracts: Firm Fixed-Price Contract Fixed-Price Contract with Economic Price Adjustment Fixed-Price Contract Providing for Prospective Periodic Redetermination of Price Fixed-Price Contract Providing for Retroactive Redetermination of Price Fixed-Price Contract Providing for Firm Target Cost Incentives Fixed-Price Contract Providing for Successive Target Cost Incentives Fixed-Price Contract Providing for Performance Incentives Fixed-Price Level-of-Effort Term Contract.
flat-benefit plans
A benefit formula that bases benefits on a fixed amount per year of service, such as $20 of monthly retirement income for each year of credited service. A flat-benefit plan is a plan with such a formula.
Used in 1 subtopic:715-30
Floating participation method
Liquidation method used to allocate principal payments on the receivables in a trust to the investors, under which principal payments allocated to the investors are based on the investors' actual participation interests in the receivables in the trust each month. Each month, investors' participation interests in the credit card receivables in the trust are redetermined for that month's allocation of principal payments.
Used in 1 subtopic:860-10
floating time
A time-sharing arrangement in which ownership is passed through a deed but the buyer is not limited to a specific period (generally, a specific week) during the year.
Used in 1 subtopic:978-10
floor broker
A member of a securities exchange who executes transactions on the floor of an exchange for the account of that member's own entity or for the account of other member entities. Broker-dealers often engage floor brokers, who are responsible for executing securities transactions on the exchanges for the account of the broker-dealer. Floor brokers employed by the entity may execute trades on behalf of other broker-dealers, for which the entity is paid a brokerage fee. The purchase and sale department of the broker-dealer maintains the records of floor brokerage fees that are due to other broker-dealers who execute orders on the entity's behalf and brokerage fees due from other broker-dealers.
Used in 1 subtopic:940-20
forecasted transaction
A transaction that is expected to occur for which there is no firm commitment. Because no transaction or event has yet occurred and the transaction or event when it occurs will be at the prevailing market price, a forecasted transaction does not give an entity any present rights to future benefits or a present obligation for future sacrifices.
foreign activities
See paragraph 942-235-S99-1, Regulation S-X Rule 9-05(c)(1), for the definition of foreign activities for purposes of Regulation S-X Rule 9-05.
Used in 1 subtopic:235-942
foreign currency
A currency other than the functional currency of the entity being referred to (for example, the dollar could be a foreign currency for a foreign entity). Composites of currencies, such as the Special Drawing Rights, used to set prices or denominate amounts of loans, and so forth, have the characteristics of foreign currency.
foreign currency statements
Financial statements that employ as the unit of measure a functional currency that is not the reporting currency of the reporting entity.
foreign currency transactions
Transactions whose terms are denominated in a currency other than the entity's functional currency. Foreign currency transactions arise when a reporting entity does any of the following: Buys or sells on credit goods or services whose prices are denominated in foreign currency Borrows or lends funds and the amounts payable or receivable are denominated in foreign currency Is a party to an unperformed forward exchange contract For other reasons, acquires or disposes of assets, or incurs or settles liabilities denominated in foreign currency.
foreign currency translation
The process of expressing in the reporting currency of the reporting entity those amounts that are denominated or measured in a different currency.
foreign entity
An operation (for example, subsidiary, division, branch, joint venture, and so forth) whose financial statements are both: Prepared in a currency other than the reporting currency of the reporting entity Combined or consolidated with or accounted for on the equity basis in the financial statements of the reporting entity.
foreign exchange risk
The risk of changes in a hedged item's fair value or functional-currency-equivalent cash flows attributable to changes in the related foreign currency exchange rates.
Forgivable Loan
(P) December 16, 2028; (N) December 16, 2029832-10-65-2A loan for which the lender agrees to waive repayment under certain prescribed conditions established by a government.
Used in 1 subtopic:832-10
Formation Date
The formation date of a joint venture is the date on which an entity initially meets the definition of a joint venture, which is not necessarily the legal entity formation date. The formation date is the measurement date for the formation transaction. If multiple arrangements are accounted for as a single transaction that establishes the formation of a joint venture, the formation date is the measurement date for all arrangements that form part of the single formation transaction.
forward commitment dollar rolls
See Government National Mortgage Association Rolls.
Used in 1 subtopic:815-10
Forward exchange contracts
A forward exchange contract is an agreement between two parties to exchange different currencies at a specified exchange rate at an agreed-upon future date.
Used in 1 subtopic:830-946
Fractional Interests
A partial ownership interest in real estate that typically includes larger blocks of time on an annual basis (for example, three weeks or more).
Used in 1 subtopic:978-10
Franchise Agreement
A written business agreement that meets the following principal criteria: The relation between the franchisor and franchisee is contractual, and an agreement, confirming the rights and responsibilities of each party, is in force for a specified period. The continuing relation has as its purpose the distribution of a product or service, or an entire business concept, within a particular market area. Both the franchisor and the franchisee contribute resources for establishing and maintaining the franchise. The franchisor's contribution may be a trademark, a company reputation, products, procedures, manpower, equipment, or a process. The franchisee usually contributes operating capital as well as the managerial and operational resources required for opening and continuing the franchised outlet. The franchise agreement outlines and describes the specific marketing practices to be followed, specifies the contribution of each party to the operation of the business, and sets forth certain operating procedures that both parties agree to comply with. The establishment of the franchised outlet creates a business entity that will, in most cases, require and support the full-time business activity of the franchisee. (There are numerous other contractual distribution arrangements in which a local businessperson becomes the authorized distributor or representative for the sale of a particular good or service, along with many others, but such a sale usually represents only a portion of the person's total business.) Both the franchisee and the franchisor have a common public identity. This identity is achieved most often through the use of common trade names or trademarks and is frequently reinforced through advertising programs designed to promote the recognition and acceptance of the common identity within the franchisee's market area. The payment of an initial franchise fee or a continuing royalty fee is not a necessary criterion for an agreement to be considered a franchise agreement.
Used in 1 subtopic:606-952
franchisee
The party who has been granted business rights (the franchise) to operate the franchised business.
Used in 1 subtopic:952-10
Franchisor
The party who grants business rights (the franchise) to the party (the franchisee) who will operate the franchised business.
fraternal benefit societies
An entity that provides life or health insurance to its members and their beneficiaries. Policyholders normally participate in the earnings of the society, and insurance contracts stipulate that the society has the power to assess its members if the funds available for future policy benefits are not sufficient to provide for benefits and expenses.
Used in 1 subtopic:944-20
freestanding call option
A call option that is neither embedded in nor attached to an asset subject to that call option.
Freestanding Contract
A freestanding contract is entered into either: Separate and apart from any of the entity's other financial instruments or equity transactions In conjunction with some other transaction and is legally detachable and separately exercisable.
freestanding financial instruments
A financial instrument that meets either of the following conditions: It is entered into separately and apart from any of the entity's other financial instruments or equity transactions. It is entered into in conjunction with some other transaction and is legally detachable and separately exercisable.
Front-End Load
A sales commission or charge payable at the time of purchase of mutual fund shares.
fronting arrangements
Reinsurance arrangements in which the ceding entity issues a policy and reinsures all or substantially all of the insurance risk with the assuming entity.
Used in 1 subtopic:944-20
full eligibility date
The date at which an employee has rendered all of the service necessary to have earned the right to receive all of the benefits expected to be received by that employee (including any beneficiaries and dependents expected to receive benefits). Determination of the full eligibility date is affected by plan terms that provide incremental benefits expected to be received by or on behalf of an employee for additional years of service, unless those incremental benefits are trivial. Determination of the full eligibility date is not affected by plan terms that define when benefit payments commence or by an employee's current marital or dependency status.
full eligibility for benefits
The status of an employee having reached the employee's full eligibility date. Full eligibility for benefits is achieved by meeting specified age, service, or age and service requirements of the postretirement benefit plan. See Full Eligibility Date.
Used in 1 subtopic:715-60
fully benefit-responsive investment contracts
An investment contract is considered fully benefit-responsive if all of the following criteria are met for that contract, analyzed on an individual basis: The investment contract is effected directly between the plan and the issuer and prohibits the plan from assigning or selling the contract or its proceeds to another party without the consent of the issuer. Either of the following conditions exists: The repayment of principal and interest credited to participants in the plan is a financial obligation of the issuer of the investment contract. Prospective interest crediting rate adjustments are provided to participants in the plan on a designated pool of investments held by the plan or the contract issuer, whereby a financially responsible third party, through a contract generally referred to as a wrapper, must provide assurance that the adjustments to the interest crediting rate will not result in a future interest crediting rate that is less than zero. If an event has occurred such that realization of full contract value for a particular investment contract is no longer probable (for example, a significant decline in creditworthiness of the contract issuer or wrapper provider), the investment contract shall no longer be considered fully benefit-responsive. The terms of the investment contract require all permitted participant-initiated transactions with the plan to occur at contract value with no conditions, limits, or restrictions. Permitted participant-initiated transactions are those transactions allowed by the plan, such as any of the following: Withdrawals for benefits Loans Transfers to other funds within the plan. An event that limits the ability of the plan to transact at contract value with the issuer and that also limits the ability of the plan to transact at contract value with the participants in the plan, such as any of the following, must be probable of not occurring: Premature termination of the contracts by the plan Plant closings Layoffs Plan termination Bankruptcy Mergers Early retirement incentives. The plan itself must allow participants reasonable access to their funds. If access to funds is substantially restricted by plan provisions, investment contracts held by those plans may not be considered to be fully benefit-responsive. For example, if plan participants are allowed access at contract value to all or a portion of their account balances only upon termination of their participation in the plan, it would not be considered reasonable access and, therefore, investment contracts held by that plan would generally not be deemed to be fully benefit-responsive. However, in plans with a single investment fund that allow reasonable access to assets by inactive participants, restrictions on access to assets by active participants consistent with the objective of the plan (for example, retirement or health and welfare benefits) will not affect the benefit responsiveness of the investment contracts held by those single-fund plans. Also, if a plan limits participants' access to their account balances to certain specified times during the plan year (for example, semiannually or quarterly) to control the administrative costs of the plan, that limitation generally would not affect the benefit responsiveness of the investment contracts held by that plan. In addition, administrative provisions that place short-term restrictions (for example, three or six months) on transfers to competing fixed-rate investment options to limit arbitrage among those investment options (equity wash provisions) would not affect a contract's benefit responsiveness.
fully eligible plan participants
Collectively, that group of former employees (including retirees) and active employees who have rendered service to or beyond their full eligibility date and who are expected to receive benefits under the plan, including benefits to their beneficiaries and covered dependents.
Used in 1 subtopic:715-60
fully insured experience-rated arrangements
In a fully insured experience-rated arrangement, specified benefits are paid by the insurance entity that assumes all the financial risk. Contract experience is monitored by the insurance entity. Contract experience may or may not include the experience of other similar contract holders. To the extent that benefits incurred plus risk charges and administration costs are less than premiums paid, the related plan is entitled to an experience-rating refund or dividend (see paragraphs 965-310-25-2965-310-25-3). If the total of benefits incurred, risk charges, and administrative costs exceeds premiums, the accumulated loss is generally borne by the insurance entity but may be carried over to future periods until it has been recovered (see paragraph 965-30-25-5). The related plan often has no obligation to continue coverage or to reimburse the carrier for any accumulated loss, although there are certain types of contracts that require additional payments by the plan.
fully insured pooled arrangements
In a fully insured pooled arrangement, specified benefits are covered by the insurance entity. The insurance entity pools the experience of the plan with that of other similar businesses and assumes the financial risk of adverse experience. In such an arrangement, a plan generally has no obligation for benefits covered by the arrangement other than the payment of premiums due to the insurance entity (see paragraph 965-10-05-9).
Used in 1 subtopic:965-10
functional currency
An entity's functional currency is the currency of the primary economic environment in which the entity operates; normally, that is the currency of the environment in which an entity primarily generates and expends cash. (See paragraphs 830-10-45-2830-10-45-3830-10-45-4830-10-45-5830-10-45-6 and 830-10-55-3830-10-55-4830-10-55-5830-10-55-6830-10-55-7.)
Functional Expense Classification
A method of grouping expenses according to the purpose for which costs are incurred. The primary functional classifications of a not-for-profit entity are program services and supporting activities.
Used in 6 subtopics:205-958220-954220-958405-958715-958720-958
fund
Used as a verb, to pay over to a funding agency (as to fund future pension benefits or to fund pension cost). Used as a noun, assets accumulated in the hands of a funding agency for the purpose of meeting pension benefits when they become due.
Used in 1 subtopic:715-30
funding agency
An organization or individual, such as a specific corporate or individual trustee or an insurance entity, that provides facilities for the accumulation of assets to be used for paying benefits under a pension plan; an organization, such as a specific life insurance entity, that provides facilities for the purchase of such benefits.
Used in 1 subtopic:960-10
Funding Policy
The program regarding the amounts and timing of contributions by the employers, plan participants, and any other sources (for example, state subsidies or federal grants) to provide the benefits a pension plan or other postretirement benefit plan specifies.
fundraising activities
Activities undertaken to induce potential donors to contribute money, securities, services, materials, facilities, other assets, or time.
Used in 1 subtopic:720-958
Funds Functioning as Endowment
Net assets without donor restrictions (donors include other types of contributors, including makers of certain grants) designated by an entity's governing board to be invested to provide income for generally a long but not necessarily specified period. A board-designated endowment, which results from an internal designation, is generally not donor-restricted and is classified as net assets without donor restrictions. The governing board has the right to decide at any time to expend such funds. In rare circumstances, funds functioning as endowment also can include a portion of net assets with donor restrictions. For example, if an NFP is unable to spend donor-restricted contributions in the near term, the board sometimes considers the long-term investment of these funds. (Sometimes referred to as quasi-endowment funds or board-designated endowment funds.)
Used in 7 subtopics:205-958210-958220-958230-10320-958605-958+1 more
futures contracts
A standard and transferable form of contract that binds the seller to deliver to the bearer a standard amount and grade of a commodity to a specific location at a specified time. It usually includes a schedule of premiums and discounts for quality variation.
Used in 1 subtopic:905-10
g
gain contingency
An existing condition, situation, or set of circumstances involving uncertainty as to possible gain to an entity that will ultimately be resolved when one or more future events occur or fail to occur.
Used in 1 subtopic:450-30
Gain or Loss
A change in the value of either the benefit obligation (projected benefit obligation for pension plans or accumulated postretirement benefit obligation for other postretirement benefit plans) or the plan assets resulting from experience different from that assumed or from a change in an actuarial assumption, or the consequence of a decision to temporarily deviate from the other postretirement benefit substantive plan. Gains or losses that are not recognized in net periodic pension cost or net periodic postretirement benefit cost when they arise are recognized in other comprehensive income. Those gains or losses are subsequently recognized as a component of net periodic pension cost or net periodic postretirement benefit cost based on the recognition and amortization provisions of Subtopic 715-30 or Subtopic 715-60.
Gain or loss
The sum of the difference between the actual return on plan assets and the expected return on plan assets and the amortization of the net gain or loss recognized in accumulated other comprehensive income. The gain or loss component is the net effect of delayed recognition of gains and losses in determining net periodic pension cost (the net change in the gain or loss) in accumulated other comprehensive income except that it does not include changes in the projected benefit obligation occurring during the period and deferred for later recognition in net periodic pension cost.
Used in 1 subtopic:715-30
gain or loss component of net periodic postretirement benefit cost
The sum of all of the following: The difference between the actual return on plan assets and the expected return on plan assets Any gain or loss immediately recognized or the amortization of the net gain or loss recognized in accumulated other comprehensive income Any amount immediately recognized as a gain or loss pursuant to a decision to temporarily deviate from the substantive plan. The gain or loss component is generally the net effect of delayed recognition in determining net periodic postretirement benefit cost of gains and losses (the net change in the net gain or loss recognized in accumulated other comprehensive income) except that it does not include changes in the accumulated postretirement benefit obligation occurring during the period and deferred for later recognition in net periodic postretirement benefit cost.
Used in 1 subtopic:715-60
Gains and Losses Included in Comprehensive Income but Excluded from Net Income
Gains and losses included in comprehensive income but excluded from net income include certain changes in fair values of investments in marketable equity securities classified as noncurrent assets, certain changes in fair values of investments in industries having specialized accounting practices for marketable securities, adjustments related to pension liabilities or assets recognized within other comprehensive income, and foreign currency translation adjustments. Future changes to generally accepted accounting principles (GAAP) may change what is included in this category.
Used in 1 subtopic:740-20
general account
All operations of an insurance entity that are not reported in the separate account(s).
general partnership
An association in which each partner has unlimited liability.
Goodwill
An asset representing the future economic benefits arising from other assets acquired in a business combination, acquired in an acquisition by a not-for-profit entity, or recognized by a joint venture upon formation that are not individually identified and separately recognized. For ease of reference, this term also includes the immediate charge recognized by not-for-profit entities in accordance with paragraph 958-805-25-29.
Used in 11 subtopics:350-10350-20350-30740-805805-10805-20+5 more
Government Grant
(P) December 16, 2028; (N) December 16, 2029832-10-65-2A transfer of a monetary asset or a tangible nonmonetary asset, other than in an exchange transaction (including an exchange transaction that may be at a significant discount to fair value), from a government to an entity except for a not-for-profit entity and an employee benefit plan within the scope of Topics 960, 962, and 965 on plan accounting.
Government National Mortgage Association
Often referred to as Ginnie Mae, GNMA is a U.S. governmental agency that guarantees certain types of mortgage-backed securities and provides funds for and administers certain types of low-income housing assistance programs.
Government National Mortgage Association [GNMA] rolls
The term Government National Mortgage Association (GNMA) rolls has been used broadly to refer to a variety of transactions involving mortgage-backed securities, frequently those issued by the GNMA. There are four basic types of transactions: Type 1. Reverse repurchase agreements for which the exact same security is received at the end of the repurchase period (vanilla repo) Type 2. Fixed coupon dollar reverse repurchase agreements (dollar repo) Type 3. Fixed coupon dollar reverse repurchase agreements that are rolled at their maturities, that is, renewed in lieu of taking delivery of an underlying security (GNMA roll) Type 4. Forward commitment dollar rolls (also referred to as to-be-announced GNMA forward contracts or to-be-announced GNMA rolls), for which the underlying security does not yet exist.
Used in 1 subtopic:860-10
Grant Date
The date at which a grantor and a grantee reach a mutual understanding of the key terms and conditions of a share-based payment award. The grantor becomes contingently obligated on the grant date to issue equity instruments or transfer assets to a grantee who delivers goods or renders services or purchases goods or services as a customer. Awards made under an arrangement that is subject to shareholder approval are not deemed to be granted until that approval is obtained unless approval is essentially a formality (or perfunctory), for example, if management and the members of the board of directors control enough votes to approve the arrangement. Similarly, individual awards that are subject to approval by the board of directors, management, or both are not deemed to be granted until all such approvals are obtained. The grant date for an award of equity instruments is the date that a grantee begins to benefit from, or be adversely affected by, subsequent changes in the price of the grantor's equity shares. Paragraph 718-10-25-5 provides guidance on determining the grant date. See Service Inception Date.
gross eligible charges
The cost of providing the postretirement health care benefits covered by the plan to a plan participant, before adjusting for expected reimbursements from Medicare and other providers of health care benefits and for the effects of the cost-sharing provisions of the plan.
Used in 1 subtopic:715-60
Gross Margin
The excess of sales over cost of goods sold. Gross margin does not consider all operating expenses.
Used in 1 subtopic:220-30
group insurance
Insurance protecting a group of persons, usually employees of an entity and their dependents. A single insurance contract is issued to their employer or other representative of the group. Individual certificates often are given to each insured individual or family unit. The insurance usually has an annual renewable contract period, although the insurer may guarantee premium rates for two or three years. Adjustments to premiums relating to the actual experience of the group of insured persons are common.
Used in 1 subtopic:944-20
Group participating pension contracts
Contracts between insurance entities and pension plans that have account balance crediting provisions that give the contract holder the total return based on a referenced pool of assets over the life of the contract either through crediting rates or termination adjustments.
Used in 1 subtopic:944-20
grove
Fruit or nut trees planted in geometric patterns to economically facilitate care of the trees and harvest of the fruit or nuts. See also Orchard.
Used in 1 subtopic:360-905
guaranteed interest rate
The interest rate guaranteed in a policy's cash surrender value or nonforfeiture value calculation.
Used in 1 subtopic:944-40
guaranteed investment options
Component of a variable contract that guarantees a specific rate of performance.
Used in 1 subtopic:944-20
guaranteed minimum accumulation benefit
A minimum accumulation benefit or a guaranteed account value floor that is available to a deferred annuity contract holder in cash.
Guaranteed Minimum Income Benefit
A guarantee that, regardless of account balance performance, the contract holder will be able to annuitize after a specified date and receive a defined minimum periodic benefit. These benefits are available only if the contract holder elects to annuitize.
guaranteed minimum withdrawal benefit
A benefit that provides a contract holder a guarantee that a minimum amount (usually stated as a percentage of premiums) will be available for withdrawal over a specific period. Regardless of the contract value, the contract holder is guaranteed the right to periodic withdrawals from the contract until the amount of premiums deposited into the contract is withdrawn.
h
401(h) account
A postretirement medical-benefit component provided in some defined benefit pension plans in addition to the normal retirement benefits of the plan, pursuant to Section 401(h) of the Internal Revenue Code.
hazardous substance
Related to Superfund: the definition of hazardous substance in the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 is broader than the definition of hazardous wastes under the Resource Conservation and Recovery Act of 1976. Under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, a hazardous substance is any element, compound, mixture, solution, or substance that, when released to the environment, may present substantial danger to the public health or welfare or to the environment. It also includes the following: Specifically designated substances Toxic pollutants under the Federal Water Pollution Control Act Hazardous wastes having the characteristics identified under or listed pursuant to the Resource Conservation and Recovery Act of 1976 (excluding any waste suspended from regulation under the Solid Waste Disposal Act by Congress) Hazardous air pollutants under the Clean Air Act Any imminently hazardous chemical substance or mixture for which the government has taken action under section 7 of the Toxic Substances Control Act. Petroleum (including crude oil not otherwise specifically listed or designated as a hazardous substance under any of those laws), natural gas, natural gas liquids, liquefied natural gas, or synthetic gas useable for fuel (or mixtures of natural gas and such synthetic gas) are excluded.
Used in 1 subtopic:410-30
hazardous waste
Related to Resource Conservation and Recovery Act of 1976: a waste, or combination of wastes, that because of its quantity, concentration, toxicity, corrosiveness, mutagenicity or inflammability, or physical, chemical, or infectious characteristics may cause, or significantly contribute to, an increase in mortality or an increase in serious irreversible, or incapacitating reversible illness or pose a substantial present or potential hazard to human health or the environment when improperly treated, stored, transported, or disposed of, or otherwise managed. Technically, those wastes that are regulated under the Resource Conservation and Recovery Act of 1976 40 CFR Part 261 are considered to be hazardous wastes.
hazardous waste constituents
A constituent that caused the waste to be listed as a hazardous waste under the Resource Conservation and Recovery Act of 1976 40 CFR Part 261 Subpart D.
Used in 1 subtopic:410-30
health and welfare benefit plans
Health and welfare benefit plans include plans that provide the following: Any of the following benefits: Medical, dental, visual, psychiatric, or long-term health care Life insurance (offered separately from a pension plan) Certain severance benefits Accidental death or dismemberment benefits. Benefits for unemployment, disability, vacations, or holidays Other benefits such as apprenticeships, tuition assistance, day care, dependent care, housing subsidies, or legal services.
Used in 9 subtopics:205-965310-965320-965325-965360-965965-10+3 more
health care cost trend rates
An assumption about the annual rates of change in the cost of health care benefits currently provided by the postretirement benefit plan, due to factors other than changes in the composition of the plan population by age and dependency status, for each year from the measurement date until the end of the period in which benefits are expected to be paid. The health care cost trend rates implicitly consider estimates of health care inflation, changes in health care utilization or delivery patterns, technological advances, and changes in the health status of the plan participants. Differing types of services, such as hospital care and dental care, may have different trend rates.
Used in 1 subtopic:715-60
Health Insurance Claims
Claims related to the cost of medical treatments (other than claims related to liability insurance that covers claims against the insured for injury of or by others, such as, but not limited to, workers' compensation, disability, and general liability insurance).
Used in 1 subtopic:944-40
health maintenance organizations
A generic group of medical care entities organized to provide defined health care services to members in return for fixed, periodic premiums (usually paid monthly) that are paid in advance.
Hedged Layer
The hedged item designated in a portfolio layer method hedging relationship, representing a stated amount or stated amounts of a closed portfolio of financial assets or one or more beneficial interests secured by a portfolio of financial instruments that is not expected to be affected by prepayments, defaults, or other factors affecting the timing and amount of cash flows for the designated hedge period.
high-yield debt securities
Corporate and municipal debt securities having a lower-than-investment-grade credit rating (BB+ or lower by Standard & Poor's, or Ba or lower by Moody's). Because high-yield debt securities typically are used when lower-cost capital is not available, they have interest rates several percentage points higher than investment-grade debt and often have shorter maturities. These high-yielding corporate and municipal debt obligations are frequently referred to as junk bonds.
Used in 1 subtopic:320-946
Highest and Best Use
The use of a nonfinancial asset by market participants that would maximize the value of the asset or the group of assets and liabilities (for example, a business) within which the asset would be used.
Used in 1 subtopic:820-10
historical cost
The generally accepted method of accounting used in the primary financial statements that is based on measures of historical prices without restatement into units, each of which has the same general purchasing power.
Used in 1 subtopic:255-10
historical cost-constant purchasing power accounting
A method of accounting based on measures of historical prices in units of a currency, each of which has the same general purchasing power.
Used in 1 subtopic:255-10
Holding Gain or Loss
The net change in fair value of a security. The holding gain or loss does not include dividend or interest income recognized but not yet received, writeoffs, or the allowance for credit losses.
Holding period
The period during which a time-sharing interval is held for sale. Sellers may offer time-sharing units for rent during such holding periods.
Hosting Arrangement
In connection with accessing and using software products, an arrangement in which the customer of the software does not currently have possession of the software; rather, the customer accesses and uses the software on an as-needed basis.
i
Identifiable
An asset is identifiable if it meets either of the following criteria: It is separable, that is, capable of being separated or divided from the entity and sold, transferred, licensed, rented, or exchanged, either individually or together with a related contract, identifiable asset, or liability, regardless of whether the entity intends to do so. It arises from contractual or other legal rights, regardless of whether those rights are transferable or separable from the entity or from other rights and obligations.
idle time
Idle time represents the time that a lender's employees are not actively involved in performing origination activities for specific loans. Idle time can be caused by many factors, including lack of work, delays in work flow, and equipment failure. Idle time can be measured through the establishment of standard costs, time studies, ratios of productive and nonproductive time, and other methods.
Used in 1 subtopic:310-20
if-converted method
A method of computing EPS data that assumes conversion of convertible securities at the beginning of the reporting period (or at time of issuance, if later).
Used in 1 subtopic:260-10
immediate bonus
A sales inducement that the insurance entity is obligated to credit to the contract holder's account as a result of signing the contract, thus increasing the account value at inception.
immediate family
See paragraph 942-210-S99-1, Regulation S-X Rule 9-03(7)(e)(4), for the definition of immediate family for the purpose of Regulation S-X Rule 9-03.
impaired claims
In determining which class of creditors' claims or stockholders' interests must approve the plan, it is first necessary to determine if the class is impaired. A class of creditors' claims or stockholders' interests under a plan is not impaired if the plan leaves unaltered the legal, equitable, and contractual right of a class, cures defaults that lead to acceleration of debt or equity interest, or pays in cash the full amount of the claim, or for equity interests, the greater of the fixed liquidation preference or redemption price.
Used in 1 subtopic:852-10
Impairment
Impairment is the condition that exists when the carrying amount of a long-lived asset (asset group) exceeds its fair value.
implicit
A service period that is not explicitly stated in the terms of a share-based payment award but that may be inferred from an analysis of those terms and other facts and circumstances. For instance, if an award of share options vests upon the completion of a new product design and it is probable that the design will be completed in 18 months, the implicit service period is 18 months. See Derived Service Period, Explicit Service Period, and Requisite Service Period.
imputed interest rate
The interest rate that results from a process of approximation (or imputation) required when the present value of a note must be estimated because an established exchange price is not determinable and the note has no ready market.
Used in 1 subtopic:835-30
in force
Policies and contracts written and recorded on the books of an insurance carrier that are unexpired as of a given date.
In Substance Nonfinancial Asset
Paragraphs 610-20-15-5610-20-15-6610-20-15-7610-20-15-8 define an in substance nonfinancial asset.
in-force policies
Policies effective before a specified date that have not yet expired or been cancelled.
Used in 1 subtopic:405-30
in-substance common stock
An investment in an entity that has risk and reward characteristics that are substantially similar to that entity's common stock.
Used in 1 subtopic:323-10
in-substance defeasance
Placement by the debtor of amounts equal to the principal, interest, and prepayment penalties related to a debt instrument in an irrevocable trust established for the benefit of the creditor.
Used in 1 subtopic:470-50
Inactive Employees
Employees who are not currently rendering service to the employer and who have not been terminated. They include those who have been laid off and those on disability leave, regardless of whether they are expected to return to active status.
incidental operations
Revenue-producing activities engaged in during the holding or development period to reduce the cost of developing the property for its intended use, as distinguished from activities designed to generate a profit or a return from the use of the property.
Income Approach
Valuation approaches that convert future amounts (for example, cash flows or income and expenses) to a single current (that is, discounted) amount. The fair value measurement is determined on the basis of the value indicated by current market expectations about those future amounts.
Used in 1 subtopic:820-10
income available to common stockholders
Income (or loss) from continuing operations or net income (or net loss) adjusted for preferred stock dividends.
Used in 1 subtopic:260-10
Income from Continuing Operations
Income after applicable income taxes but excluding the results of discontinued operations, the cumulative effect of accounting changes, translation adjustments, purchasing power gains and losses on monetary items, and increases and decreases in the current cost or lower recoverable amount of nonmonetary assets and liabilities.
Used in 1 subtopic:255-10
income tax expense (or benefit)
The sum of current tax expense (or benefit) and deferred tax expense (or benefit).
Income Taxes
Domestic and foreign federal (national), state, and local (including franchise) taxes based on income.
Used in 18 subtopics:220-40270-740350-10405-20605-958718-740+6 more
income-producing real estate
Properties that meet all of the following criteria: Cash flows can be directly associated with a long-term leasing agreement with unaffiliated parties. The property is being operated. (It is not in a construction phase.) Future cash flows from the property are reasonably estimable. Ancillary services are not a significant part of the lease agreement. Hotels, which have occupancy rates and related cash flows that may fluctuate to a relatively large extent, do not meet the criteria for income-producing real estate.
Used in 1 subtopic:255-10
Incremental Borrowing Rate
The rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment.
Incremental Costs from Incidental Operations
Costs that would not be incurred except in relation to the conduct of incidental operations. Interest, taxes, insurance, security, and similar costs that would be incurred during the development of a real estate project regardless of whether incidental operations were conducted are not incremental costs.
Incremental Direct Cost of Contract Acquisition
A cost to acquire an insurance contract that has both of the following characteristics: It results directly from and is essential to the contract transaction(s). It would not have been incurred by the insurance entity had the contract transaction(s) not occurred.
Used in 1 subtopic:944-30
incremental direct costs
Costs to originate a loan that have both of the following characteristics: Result directly from and are essential to the lending transaction Would not have been incurred by the lender had that lending transaction not occurred.
Used in 1 subtopic:310-20
Incremental Revenue from Incidental Operations
Revenues that would not be produced except in relation to the conduct of incidental operations.
incurred but not reported
Losses incurred by the insured entity that have not yet been reported to the insurance entity.
Used in 1 subtopic:720-20
incurred claims cost
The cost of providing the postretirement health care benefits covered by the plan to a plan participant, after adjusting for reimbursements from Medicare and other providers of health care benefits and for deductibles, coinsurance provisions, and other specific claims costs borne by the retiree. See Net Incurred Claims Cost (By Age).
Used in 1 subtopic:715-60
incurred cost
A cost arising from cash paid out or obligation to pay for an acquired asset or service, a loss from any cause that has been sustained and has been or must be paid for.
incurred losses
Losses paid or unpaid for which the entity has become liable during a period.
Used in 1 subtopic:405-30
incurred-but-not-reported claims
Claims relating to insured events that have occurred but have not yet been reported to the insurer or reinsurer as of the date of the financial statements.
Used in 1 subtopic:944-40
indirect effects of a change in accounting principle
Any changes to current or future cash flows of an entity that result from making a change in accounting principle that is applied retrospectively. An example of an indirect effect is a change in a nondiscretionary profit sharing or royalty payment that is based on a reported amount such as revenue or net income.
Used in 1 subtopic:250-10
Indirect Guarantee of Indebtedness
An agreement that obligates the guarantor to transfer funds to a debtor upon the occurrence of specified events, under conditions whereby: After funds are transferred from the guarantor to the debtor, the funds become legally available to creditors through their claims against the debtor Those creditors may enforce the debtor's claims against the guarantor under the agreement. In contrast, with a direct guarantee of indebtedness, if the debtor defaults, the creditor has a direct claim on the guarantor. Examples of indirect guarantees include agreements to advance funds if a debtor's net income, coverage of fixed charges, or working capital falls below a specified minimum.
Used in 1 subtopic:460-10
indirect loan
An indirect loan is a loan made by the employer to the employee stock ownership plan, with a related outside loan to the employer.
Used in 1 subtopic:718-40
Indirect project costs
Costs incurred after the acquisition of the property, such as construction administration (for example, the costs associated with a field office at a project site and the administrative personnel that staff the office), legal fees, and various office costs, that clearly relate to projects under development or construction. Examples of office costs that may be considered indirect project costs are cost accounting, design, and other departments providing services that are clearly related to real estate projects.
Used in 1 subtopic:360-970
Infrequency of Occurrence
The underlying event or transaction should be of a type that would not reasonably be expected to recur in the foreseeable future, taking into account the environment in which the entity operates (see paragraph 220-20-60-1).
Inherent Contribution
A contribution that results if an entity voluntarily transfers assets (or net assets) or performs services for another entity in exchange for either no assets or for assets of substantially lower value and unstated rights or privileges of a commensurate value are not involved.
Used in 6 subtopics:220-954220-958230-10350-60805-954805-958
Initial Direct Costs
Incremental costs of a lease that would not have been incurred if the lease had not been obtained.
initiation or front-end fees
Amounts that are assessed against the policyholder balance as consideration for origination of the contract.
Used in 1 subtopic:605-944
Inputs
The assumptions that market participants would use when pricing the asset or liability, including assumptions about risk, such as the following: The risk inherent in a particular valuation technique used to measure fair value (such as a pricing model) The risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable.
Used in 1 subtopic:820-10
insurance contracts
A contract in which an insurance entity unconditionally undertakes a legal obligation to provide specified benefits to specific individuals in return for a fixed consideration or premium. An insurance contract is irrevocable and involves the transfer of significant risk from the employer (or the plan) to the insurance entity.
Used in 1 subtopic:715-60
insurance policy
The legal agreement between the policyholder and the insurance entity that states the terms of the arrangement. The term insurance policy includes all riders, attachments, side agreements, and other related documents that are either directly or indirectly part of the contractual arrangement. (Note: The use of this glossary term is not consistent among legal contracts. When determining the applicability of this term, the economic substance of the item shall be taken into consideration.)
Used in 1 subtopic:325-30
insurance risk
The risk arising from uncertainties about both underwriting risk and timing risk. Actual or imputed investment returns are not an element of insurance risk. Insurance risk is fortuitous; the possibility of adverse events occurring is outside the control of the insured.
intangible asset class
A group of intangible assets that are similar, either by their nature or by their use in the operations of an entity.
Intangible Assets
Assets (not including financial assets) that lack physical substance. (The term intangible assets is used to refer to intangible assets other than goodwill.)
Used in 10 subtopics:220-40350-10350-20350-30350-60610-20+4 more
Integral Equipment
Integral equipment is any physical structure or equipment attached to the real estate that cannot be removed and used separately without incurring significant cost.
Used in 1 subtopic:978-10
integrated contract features
A contract feature in which the benefits provided by the feature can be determined only in conjunction with the base contract.
Used in 1 subtopic:944-30
intended use
Intended use of an asset embraces both readiness for use and readiness for sale, depending on the purpose of acquisition.
Used in 1 subtopic:835-20
Interest cost
The amount recognized in a period determined as the increase in the projected benefit obligation due to the passage of time.
Used in 1 subtopic:715-30
Interest cost
The increase in the accumulated postretirement benefit obligation to recognize the effects of the passage of time.
Used in 1 subtopic:715-60
Interest Cost
Interest cost includes interest recognized on obligations having explicit interest rates, interest imputed on certain types of payables in accordance with Subtopic 835-30, and interest related to a finance lease determined in accordance with Topic 842. With respect to obligations having explicit interest rates, interest cost includes amounts resulting from periodic amortization of discount or premium and issue costs on debt.
Used in 1 subtopic:835-20
interest method
The method used to arrive at a periodic interest cost (including amortization) that will represent a level effective rate on the sum of the face amount of the debt and (plus or minus) the unamortized premium or discount and expense at the beginning of each period.
Interest Rate Risk
For recognized variable-rate financial instruments and forecasted issuances or purchases of variable-rate financial instruments, interest rate risk is the risk of changes in the hedged item's cash flows attributable to changes in the contractually specified interest rate in the agreement. For recognized fixed-rate financial instruments, interest rate risk is the risk of changes in the hedged item's fair value attributable to changes in the designated benchmark interest rate. For forecasted issuances or purchases of fixed-rate financial instruments, interest rate risk is the risk of changes in the hedged item's cash flows attributable to changes in the designated benchmark interest rate.
interest-only strips
A contractual right to receive some or all of the interest due on a bond, mortgage loan, collateralized mortgage obligation, or other interest-bearing financial asset.
intermediary
Although in general usage the term intermediary encompasses a broad range of situations in which an entity acts between two or more other parties, in this usage, it refers to situations in which a recipient entity acts as a facilitator for the transfer of assets between a potential donor and a potential beneficiary (donee) but is neither an agent or trustee nor a donee and donor.
intermediate-life plants
Intermediate-life plants have growth and production cycles of more than one year but less than those of trees and vines.
internal derivative
A foreign currency derivative instrument that has been entered into with another member of a consolidated group (such as a treasury center).
internal replacement
A modification in product benefits, features, rights, or coverages that occurs by a contract exchange; by amendment, endorsement, or rider to a contract; or by the election of a benefit, feature, right, or coverage within the contract.
Used in 1 subtopic:944-30
internal reserve method
A method for making payments to investors for collections of principal and interest on mortgage loans by issuers of Government National Mortgage Association (GNMA) securities. An issuer electing the internal reserve method is required to deposit in a custodial account an amount equal to one month's interest on the mortgage loans that collateralize the GNMA security issued.
Used in 1 subtopic:340-948
interval
The specific period (generally, a specific week) during the year that a time-sharing unit is specified by agreement to be available for occupancy by a particular customer. Also denoted Time-Sharing Interest or Time-Share.
Intra-entity derivatives
A derivative instrument contract between two members of a consolidated group.
Used in 1 subtopic:815-20
intrinsic value
The amount by which the fair value of the underlying stock exceeds the exercise price of an option. For example, an option with an exercise price of $20 on a stock whose current market price is $25 has an intrinsic value of $5. (A nonvested share may be described as an option on that share with an exercise price of zero. Thus, the fair value of a share is the same as the intrinsic value of such an option on that share.)
Inventory
The aggregate of those items of tangible personal property that have any of the following characteristics: Held for sale in the ordinary course of business In process of production for such sale To be currently consumed in the production of goods or services to be available for sale. The term inventory embraces goods awaiting sale (the merchandise of a trading concern and the finished goods of a manufacturer), goods in the course of production (work in process), and goods to be consumed directly or indirectly in production (raw materials and supplies). This definition of inventories excludes long-term assets subject to depreciation accounting, or goods which, when put into use, will be so classified. The fact that a depreciable asset is retired from regular use and held for sale does not indicate that the item should be classified as part of the inventory. Raw materials and supplies purchased for production may be used or consumed for the construction of long-term assets or other purposes not related to production, but the fact that inventory items representing a small portion of the total may not be absorbed ultimately in the production process does not require separate classification. By trade practice, operating materials and supplies of certain types of entities such as oil producers are usually treated as inventory.
investee
An entity that issued an equity instrument that is held by an investor.
investing activities
Investing activities include making and collecting loans and acquiring and disposing of debt or equity instruments and property, plant, and equipment and other productive assets, that is, assets held for or used in the production of goods or services by the entity (other than materials that are part of the entity's inventory). Investing activities exclude acquiring and disposing of certain loans or other debt or equity instruments that are acquired specifically for resale, as discussed in paragraphs 230-10-45-12 and 230-10-45-21.
investment contracts
Long-duration contracts that do not subject the insurance entity to risks arising from policyholder mortality or morbidity.
investment fund options
An investment alternative provided to a participant in a defined contribution plan. The alternatives are usually pooled fund vehicles, such as any of the following: Registered investment companies (meaning, mutual funds) Commingled funds of banks Insurance entity pooled separate accounts providing varying kinds of investments, for example, equity funds and fixed income funds. The participant may select from among the various available alternatives and periodically change that selection.
Used in 1 subtopic:325-962
investment yield
The interest rate the entity expects to earn on the assets supporting policies, net of investment expense.
Used in 1 subtopic:944-40
investor
A business entity that holds an investment in voting stock of another entity.
involuntary pools
A residual market mechanism for insureds who cannot obtain insurance in the voluntary market.
Used in 1 subtopic:405-30
Issuance of Financial Statements
See paragraph 855-10-S99-2, SEC Staff Announcement: Issuance of Financial Statements, for SEC Staff views on when financial statements are deemed to be issued.
Used in 1 subtopic:855-10
Issued, Issuance, or Issuing of an Equity Instrument
An equity instrument is issued when the issuing entity receives the agreed-upon consideration, which may be cash, an enforceable right to receive cash, or another financial instrument, goods, or services. An entity may conditionally transfer an equity instrument to another party under an arrangement that permits that party to choose at a later date or for a specified time whether to deliver the consideration or to forfeit the right to the conditionally transferred instrument with no further obligation. In that situation, the equity instrument is not issued until the issuing entity has received the consideration. The grant of stock options or other equity instruments subject to vesting conditions is not considered to be issuance.
issuer
The entity that issued a financial instrument or may be required under the terms of a financial instrument to issue its equity shares.
Used in 1 subtopic:480-10
j
joint activity
An activity that is part of the fundraising function and has elements of one or more other functions, such as program, management and general, membership development, or any other functional category used by the entity.
Used in 1 subtopic:720-958
joint and several
Where liability is joint and several, any party deemed liable is potentially responsible for all of the associated costs. This scheme of liability means that any responsible party can potentially be liable for the entire cost of remediating a site, notwithstanding that the party is responsible for only a small amount of the total hazardous substances or waste at the site and did nothing improper.
Used in 1 subtopic:410-30
joint control
Occurs if decisions regarding the financing, development, sale, or operations require the approval of two or more of the owners.
Used in 1 subtopic:323-970
joint costs
The costs of conducting joint activities that are not identifiable with a particular component of the activity. For example, the cost of postage for a letter that includes both fundraising and program components is a joint cost. Joint costs may include the following costs: Salaries Contract labor Consultants Professional fees Paper Printing Postage Event advertising Telephones Airtime Facility rentals.
Used in 1 subtopic:720-958
Joint Venture
An entity owned and operated by a small group of businesses (the joint venturers) as a separate and specific business or project for the mutual benefit of the members of the group. A government may also be a member of the group. The purpose of a joint venture frequently is to share risks and rewards in developing a new market, product, or technology; to combine complementary technological knowledge; or to pool resources in developing production or other facilities. A joint venture also usually provides an arrangement under which each joint venturer may participate, directly or indirectly, in the overall management of the joint venture. Joint venturers thus have an interest or relationship other than as passive investors. An entity that is a subsidiary of one of the joint venturers is not a joint venture. The ownership of a joint venture seldom changes, and its equity interests usually are not traded publicly. A minority public ownership, however, does not preclude an entity from being a joint venture. As distinguished from a corporate joint venture, a joint venture is not limited to corporate entities.
Used in 22 subtopics:205-10205-20220-40350-10350-20350-30+6 more
k
Kick-Out Rights (VIE definition)
The ability to remove the entity with the power to direct the activities of a VIE that most significantly impact the VIE's economic performance or to dissolve (liquidate) the VIE without cause.
Used in 1 subtopic:810-10
l
Land Development Costs
Land improvement and development costs generally fall within two broad classifications, permanent and limited-life, described as follows: Permanent land development costs include the costs of initial land surveys, titles, initial clearing, and initial leveling. Limited-life land development costs are those that will lose value as time passes or as the land and its improvements are used. Costs identified as limited-life improvements include water distribution systems, fencing, and drainage tile. The useful lives of those improvements are reasonably determinable.
Used in 1 subtopic:360-905
Lapse rate
The rate at which insurance contracts terminate through failure of the insureds to continue required premium payments. The lapse rate may also be considered a rate of nonpersistence. It is usually expressed as a ratio of the number of contracts that terminated by reason of failure of insureds to make premium payments during a given period, to the total number of contracts at the beginning of the period from which those lapses occurred.
Used in 1 subtopic:944-40
lattice model
A model that produces an estimated fair value based on the assumed changes in prices of a financial instrument over successive periods of time. The binomial model is an example of a lattice model. In each time period, the model assumes that at least two price movements are possible. The lattice represents the evolution of the value of either a financial instrument or a market variable for the purpose of valuing a financial instrument. In this context, a lattice model is based on risk-neutral valuation and a contingent claims framework. See Closed-Form Model for an explanation of the terms risk-neutral valuation and contingent claims framework.
Lead Interest
The right to the benefits (cash flows or use) of assets during the term of a split-interest agreement, which generally starts upon the signing of the agreement and terminates at either of the following times: After a specified number of years (period-certain) Upon the occurrence of a certain event, commonly either the death of the donor or the death of the lead interest beneficiary (life-contingent).
Lease
A contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration.
Used in 37 subtopics:210-20220-40230-10255-10270-740310-10+6 more
lease inception
The date of the lease agreement or commitment, if earlier. For purposes of this definition, a commitment shall be in writing, signed by the parties in interest to the transaction, and shall specifically set forth the principal provisions of the transaction. If any of the principal provisions are yet to be negotiated, such a preliminary agreement or commitment does not qualify for purposes of this definition.
Lease Liability
A lessee's obligation to make the lease payments arising from a lease, measured on a discounted basis.
Lease Modification
A change to the terms and conditions of a contract that results in a change in the scope of or the consideration for a lease (for example, a change to the terms and conditions of the contract that adds or terminates the right to use one or more underlying assets or extends or shortens the contractual lease term).
Lease Payments
See paragraph 842-10-30-5 for what constitutes lease payments from the perspective of a lessee and a lessor.
Used in 15 subtopics:230-10255-10310-10410-20440-10460-10+6 more
Lease Receivable
A lessor's right to receive lease payments arising from a sales-type lease or a direct financing lease plus any amount that a lessor expects to derive from the underlying asset following the end of the lease term to the extent that it is guaranteed by the lessee or any other third party unrelated to the lessor, measured on a discounted basis.
Lease Term
The noncancellable period for which a lessee has the right to use an underlying asset, together with all of the following: Periods covered by an option to extend the lease if the lessee is reasonably certain to exercise that option Periods covered by an option to terminate the lease if the lessee is reasonably certain not to exercise that option Periods covered by an option to extend (or not to terminate) the lease in which exercise of the option is controlled by the lessor.
Used in 17 subtopics:220-40230-10255-10310-10326-20340-970+6 more
Legal Entity
Any legal structure used to conduct activities or to hold assets. Some examples of such structures are corporations, partnerships, limited liability companies, grantor trusts, and other trusts.
Used in 9 subtopics:220-40610-20805-60810-10810-954810-958+3 more
legal notification period
The notification period that an entity is required to provide to employees in advance of a specified termination event as a result of an existing law, statute, or contract.
Used in 1 subtopic:420-10
Legal obligations
An obligation that a party is required to settle as a result of an existing or enacted law, statute, ordinance, or written or oral contract or by legal construction of a contract under the doctrine of promissory estoppel.
lending activities
Lending, committing to lend, refinancing or restructuring loans, arranging standby letters of credit, syndicating loans, and leasing activities are lending activities.
Used in 1 subtopic:310-20
Lessee
An entity that enters into a contract to obtain the right to use an underlying asset for a period of time in exchange for consideration.
Used in 30 subtopics:210-20220-40230-10255-10270-740310-10+6 more
Lessor
An entity that enters into a contract to provide the right to use an underlying asset for a period of time in exchange for consideration.
Used in 29 subtopics:210-20220-40230-10255-10270-10270-740+6 more
Level 1 Inputs
Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date.
Level 2 Inputs
Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Used in 1 subtopic:820-10
Leveraged Lease
From the perspective of a lessor, a lease that was classified as a leveraged lease in accordance with the leases guidance in effect before the effective date and for which the commencement date is before the effective date.
Used in 8 subtopics:210-20255-10270-740310-10740-10740-805+2 more
liability for claim adjustment expenses
The amount needed to provide for the estimated ultimate cost required to investigate and settle claims relating to insured events that have occurred on or before a particular date (ordinarily, the balance sheet date), whether or not reported to the insurer at that date.
Used in 1 subtopic:944-40
Liability for Future Policy Benefits
An accrued obligation to policyholders that relates to insured events, such as death or disability.
liability for unpaid claims
The amount needed to provide for the estimated ultimate cost of settling claims relating to insured events that have occurred on or before a particular date (ordinarily, the balance sheet date).
Used in 1 subtopic:944-40
Liability Issued with an Inseparable Third-Party Credit Enhancement
A liability that is issued with a credit enhancement obtained from a third party, such as debt that is issued with a financial guarantee from a third party that guarantees the issuer's payment obligation.
License Agreement
A typical license agreement for program material (for example, features, specials, series, or cartoons) covers several programs (a package) and grants a television station, group of stations, network, pay television, or cable television system (licensee) the right to broadcast either a specified number or an unlimited number of showings over a maximum period of time (license period) for a specified fee.
Used in 6 subtopics:220-40230-920350-920405-920440-920926-20
licensing agreement
Contractual arrangements entered into by an owner (licensor) of a record master or music copyright with a licensee granting the licensee the right to sell or distribute records or music for a fixed fee paid to the licensor or for a fee based on sales of records or music. License agreements are modifications of the compulsory provisions of the copyright law.
life insurance entity
An entity that can issue annuity, endowment, and accident and health insurance contracts as well as life insurance contracts. Life insurance entities may be either stock or mutual entities.
life settlement contract
A life settlement contract is a contract between the owner of a life insurance policy (the policy owner) and a third-party investor (investor), and has all of the following characteristics: The investor does not have an insurable interest (an interest in the survival of the insured, which is required to support the issuance of an insurance policy). The investor provides consideration to the policy owner of an amount in excess of the current cash surrender value of the life insurance policy. The contract pays the face value of the life insurance policy to an investor when the insured dies.
Used in 1 subtopic:325-30
life-contingent payments
Payments that are made if the beneficiary is alive when the payments are due.
Used in 1 subtopic:944-20
life, annuity, and health insurance entities
An entity that may issue annuity, endowment, and accident and health insurance contracts as well as life insurance contracts. Life and health insurance entities may be either stock or mutual entities.
Used in 1 subtopic:405-30
limited partnership
An association in which one or more general partners have unlimited liability and one or more partners have limited liability. A limited partnership is usually managed by the general partner or partners, subject to limitations, if any, imposed by the partnership agreement.
Limited-payment contracts
Long-duration insurance contracts with terms that are fixed and guaranteed, and for which premiums are paid over a period shorter than the period over which benefits are provided. Limited-payment contracts subject the insurer to risks arising from policyholder mortality and morbidity over a period that extends beyond the period or periods in which premiums are collected.
Line of Credit Arrangement
A line-of-credit or revolving-debt arrangement is an agreement that provides the borrower with the option to make multiple borrowings up to a specified maximum amount, to repay portions of previous borrowings, and to then reborrow under the same contract. Line-of-credit and revolving-debt arrangements may include both amounts drawn by the debtor (a debt instrument) and a commitment by the creditor to make additional amounts available to the debtor under predefined terms (a loan commitment).
liquidating bank
A bank with a substantial amount of nonperforming assets may transfer some or all of those assets to a newly created bank whose stock will be distributed to existing shareholders or to new investors. The newly created bank will be a liquidating bank; that is, it will manage the assets it receives and collect cash from loan repayments or dispositions of assets. All cash remaining after paying expenses and debt service, if any, will be distributed to the shareholders of the liquidating bank. The liquidating bank will likely be in the process of liquidation for several years.
Used in 1 subtopic:852-10
Liquidation
The process by which an entity converts its assets to cash or other assets and settles its obligations with creditors in anticipation of the entity ceasing all activities. Upon cessation of the entity's activities, any remaining cash or other assets are distributed to the entity's investors or other claimants (albeit sometimes indirectly). Liquidation may be compulsory or voluntary. Dissolution of an entity as a result of that entity being acquired by another entity or merged into another entity in its entirety and with the expectation of continuing its business does not qualify as liquidation.
liquidation method
The method used to allocate the principal payments on the receivables in a trust to the investors.
Used in 1 subtopic:860-10
liquidity
An asset's or liability's nearness to cash. Donor-imposed restrictions may influence the liquidity or cash flow patterns of certain assets. For example, a donor stipulation that donated cash be used to acquire land and buildings limits an entity's ability to take effective actions to respond to unexpected opportunities or needs, such as emergency disaster relief. On the other hand, some donor-imposed restrictions have little or no influence on cash flow patterns or an entity's financial flexibility. For example, a gift of cash with a donor stipulation that it be used for emergency-relief efforts has a negligible impact on an entity if emergency relief is one of its major ongoing programs.
livestock
Registered and commercial cattle, sheep, hogs, horses, poultry, and small animals bred and raised by agricultural producers.
loan
A contractual right to receive money on demand or on fixed or determinable dates that is recognized as an asset in the creditor's statement of financial position. Examples include but are not limited to accounts receivable (with terms exceeding one year) and notes receivable.
Loan Commitment
Loan commitments are legally binding commitments to extend credit to a counterparty under certain prespecified terms and conditions. They have fixed expiration dates and may either be fixed-rate or variable-rate. Loan commitments can be either of the following: Revolving (in which the amount of the overall commitment is reestablished upon repayment of previously drawn amounts) Nonrevolving (in which the amount of the overall commitment is not reestablished upon repayment of previously drawn amounts).
loan origination fees
Origination fees consist of all of the following: Fees that are being charged to the borrower as prepaid interest or to reduce the loan's nominal interest rate, such as interest buy-downs (explicit yield adjustments) Fees to reimburse the lender for origination activities Other fees charged to the borrower that relate directly to making the loan (for example, fees that are paid to the lender as compensation for granting a complex loan or agreeing to lend quickly) Fees that are not conditional on a loan being granted by the lender that receives the fee but are, in substance, implicit yield adjustments because a loan is granted at rates or terms that would not have otherwise been considered absent the fee (for example, certain syndication fees addressed in paragraph 310-20-25-19) Fees charged to the borrower in connection with the process of originating, refinancing, or restructuring a loan. This term includes, but is not limited to, points, management, arrangement, placement, application, underwriting, and other fees pursuant to a lending or leasing transaction and also includes syndication and participation fees to the extent they are associated with the portion of the loan retained by the lender.
loan participation
A transaction in which a single lender makes a large loan to a borrower and subsequently transfers undivided interests in the loan to groups of banks or other entities.
local currency
The currency of a particular country being referred to.
lock-box arrangement
An arrangement with a lender whereby the borrower's customers are required to remit payments directly to the lender and amounts received are applied to reduce the debt outstanding. A lock-box arrangement refers to any situation in which the borrower does not have the ability to avoid using working capital to repay the amounts outstanding. That is, the contractual provisions of a loan arrangement require that, in the ordinary course of business and without another event occurring, the cash receipts of a debtor are used to repay the existing obligation.
Used in 1 subtopic:470-10
Lock-up options
Contingently exercisable options to purchase equity securities of another party to a business combination, at favorable prices, to encourage successful completion of that combination. If the merger is consummated as proposed, the options expire unexercised. If, however, a specified event occurs that interferes with the planned business combination, the options become exercisable.
Used in 1 subtopic:815-40
London Interbank Offered Rate (LIBOR)
The fixed rate on a single-currency, constant-notional interest rate swap that has its variable-rate leg referenced to the London Interbank Offered Rate (LIBOR) with no additional spread over LIBOR on that variable-rate leg. That fixed rate is the derived rate that would result in the swap having a zero fair value at inception because the present value of fixed cash flows, based on that rate, equate to the present value of the variable cash flows. (P) December 16, 2018; (N) December 16, 2020815-20-65-4Glossary term superseded by Accounting Standards Update No. 2018-16.
London Interbank Offered Rate (LIBOR) Swap Rate
The fixed rate on a single-currency, constant-notional interest rate swap that has its variable-rate leg referenced to the London Interbank Offered Rate (LIBOR) with no additional spread over LIBOR on that variable-rate leg. That fixed rate is the derived rate that would result in the swap having a zero fair value at inception because the present value of fixed cash flows, based on that rate, equate to the present value of the variable cash flows.
long-term care benefit
A feature of a deferred annuity in which, if during the accumulation phase, the contract holder has an insurable event (for example, disability, loss of activities of daily living) that meets the criteria specified in the contract, additional benefits in excess of the account balance will be available.
Used in 1 subtopic:944-20
long-term contracts
See paragraph 210-10-S99-1, Regulation S-X Rule 5-02.6(d), for a definition of long-term contracts or programs.
Used in 1 subtopic:210-10
long-term obligations
Long-term obligations are those scheduled to mature beyond one year (or the operating cycle, if applicable) from the date of an entity's balance sheet.
Used in 1 subtopic:470-10
Loss Contingency
An existing condition, situation, or set of circumstances involving uncertainty as to possible loss to an entity that will ultimately be resolved when one or more future events occur or fail to occur. The term loss is used for convenience to include many charges against income that are commonly referred to as expenses and others that are commonly referred to as losses.
m
maintenance
Activities undertaken after the product is available for general release to customers to correct errors or keep the product updated with current information. Those activities include routine changes and additions.
Used in 1 subtopic:985-20
maintenance costs
Costs associated with maintaining records relating to insurance contracts and with the processing of premium collections and commissions.
make-whole provision
A contractual option that gives a debtor (that is, an issuer) the right to pay off debt before maturity at a significant premium over the fair value of the debt at the date of settlement.
management
Persons who are responsible for achieving the objectives of the entity and who have the authority to establish policies and make decisions by which those objectives are to be pursued. Management normally includes members of the board of directors, the chief executive officer, chief operating officer, vice presidents in charge of principal business functions (such as sales, administration, or finance), and other persons who perform similar policy making functions. Persons without formal titles also may be members of management.
Management and General Activities
Supporting activities that are not directly identifiable with one or more program, fundraising, or membership-development activities.
mandatorily redeemable financial instruments
Any of various financial instruments issued in the form of shares that embody an unconditional obligation requiring the issuer to redeem the instrument by transferring its assets at a specified or determinable date (or dates) or upon an event that is certain to occur.
market
A distribution channel within a certain territory. Examples of markets include theatrical exhibition, home video, pay television, free television, and the licensing of film-related products.
market
A condition affecting the exercise price, exercisability, or other pertinent factors used in determining the fair value of an award under a share-based payment arrangement that relates to the achievement of either of the following: A specified price of the issuer's shares or a specified amount of intrinsic value indexed solely to the issuer's shares A specified price of the issuer's shares in terms of a similar (or index of similar) equity security (securities). The term similar as used in this definition refers to an equity security of another entity that has the same type of residual rights. For example, common stock of one entity generally would be similar to the common stock of another entity for this purpose.
Market Approach
A valuation approach that uses prices and other relevant information generated by market transactions involving identical or comparable (that is, similar) assets, liabilities, or a group of assets and liabilities, such as a business.
Used in 1 subtopic:820-10
Market Participants
Buyers and sellers in the principal (or most advantageous) market for the asset or liability that have all of the following characteristics: They are independent of each other, that is, they are not related parties, although the price in a related-party transaction may be used as an input to a fair value measurement if the reporting entity has evidence that the transaction was entered into at market terms They are knowledgeable, having a reasonable understanding about the asset or liability and the transaction using all available information, including information that might be obtained through due diligence efforts that are usual and customary They are able to enter into a transaction for the asset or liability They are willing to enter into a transaction for the asset or liability, that is, they are motivated but not forced or otherwise compelled to do so.
Used in 16 subtopics:321-10326-20326-30350-60805-10805-60+6 more
Market Risk
The risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises the following: Interest rate risk Currency risk Other price risk.
Used in 1 subtopic:820-10
Market Risk Benefit
A contract or contract feature in a long-duration contract issued by an insurance entity that both protects the contract holder from other-than-nominal capital market risk and exposes the insurance entity to other-than-nominal capital market risk.
Used in 7 subtopics:220-10815-10815-15815-944944-30944-40+1 more
market value annuity
A contract that provides for a return of principal plus a fixed rate of return if held to maturity, or alternatively, a market-adjusted value if the surrender option is exercised by the contract holder before maturity. The market-adjusted value is typically based on current interest crediting rates being offered for new market value annuity purchases.
Market-corroborated inputs
Inputs that are derived principally from or corroborated by observable market data by correlation or other means.
Used in 1 subtopic:820-10
Marketing cooperatives
A cooperative that markets the products (crops, livestock, and so on) produced by its patrons. Marketing cooperatives provide means for agricultural producers to process and sell their products.
Used in 1 subtopic:905-10
measurement date
The date at which the equity share price and other pertinent factors, such as expected volatility, that enter into measurement of the total recognized amount of compensation cost for an award of share-based payment are fixed.
Medicare reimbursement rates
The health care cost reimbursements expected to be received by retirees through Medicare as mandated by currently enacted legislation. Medicare reimbursement rates vary by the type of benefits provided.
Used in 1 subtopic:715-60
medium
A means of mass communication, such as direct mail, direct response advertising, or television.
Used in 1 subtopic:720-958
Member of an Agricultural Cooperative
A member of an agricultural cooperative is an owner-patron who is entitled to vote at corporate meetings of an agricultural cooperative.
Used in 9 subtopics:205-905310-905325-905330-905405-905505-905+3 more
Membership development activities
Membership development activities include soliciting for prospective members and membership dues, membership relations, and similar activities. However, if there are no significant benefits or duties connected with membership, the substance of membership development activities may, in fact, be fundraising.
Used in 1 subtopic:720-958
Merger of Not-for-Profit Entities
A transaction or other event in which the governing bodies of two or more not-for-profit entities cede control of those entities to create a new not-for-profit entity.
mineral resource assets
Assets that are directly associated with and derive value from all minerals that are extracted from the earth. Such minerals include oil and gas, ores containing ferrous and nonferrous metals, coal, shale, geothermal steam, sulphur, salt, stone, phosphate, sand, and gravel. Mineral resource assets include mineral interests in properties, completed and uncompleted wells, and related equipment and facilities and other facilities required for purposes of extraction. This definition does not cover support equipment because that equipment is included in the property, plant, and equipment for which current cost measurements are required.
Used in 1 subtopic:255-10
mineral rights
The legal right to explore, extract, and retain at least a portion of the benefits from mineral deposits.
Mini-Vacation
A marketing program under which a time-share developer offers, for a fee, a short (typically, two to three days) visit to a destination where the developer operates a project. The developer typically subsidizes the fee to the customer for the mini-vacation in exchange for the customer attending a sales presentation at the project. The mini-vacation may include room accommodations, entertainment tickets, and similar items of value. The customer typically accepts the offer of the fee subsidy in exchange for his or her attending the sales presentation.
Used in 1 subtopic:330-978
minimum guaranteed death benefit
A feature in an annuity, life insurance, or similar contract that provides that in the event of an insured's death, the beneficiary (or insurer in the case of a reinsurance contract) will receive the higher of the current account balance of the contract or another amount defined in the contract.
minimum guarantees
An amount paid in advance by a licensee to a licensor for the right to sell or distribute records or music.
Minimum Lease Payments
Minimum lease payments comprise the payments that the lessee is obligated to make or can be required to make in connection with the leased property, excluding both of the following: Contingent rentals Any guarantee by the lessee of the lessor's debt and the lessee's obligation to pay (apart from the rental payments) executory costs such as insurance, maintenance, and taxes in connection with the leased property. If the lease contains a bargain purchase option, only the minimum rental payments over the lease term and the payment called for by the bargain purchase option are required to be included in the minimum lease payments. Otherwise, minimum lease payments include all of the following: The minimum rental payments called for by the lease over the lease term. Any guarantee of the residual value at the expiration of the lease term, whether or not payment of the guarantee constitutes a purchase of the leased property or of rental payments beyond the lease term by the lessee (including a third party related to the lessee) or a third party unrelated to either the lessee or the lessor, provided the third party is financially capable of discharging the obligations that may arise from the guarantee. If the lessor has the right to require the lessee to purchase the property at termination of the lease for a certain or determinable amount, that amount is required to be considered a lessee guarantee of the residual value. If the lessee agrees to make up any deficiency below a stated amount in the lessor's realization of the residual value, the residual value guarantee to be included in the minimum lease payments is required to be the stated amount, rather than an estimate of the deficiency to be made up. Any payment that the lessee must make or can be required to make upon failure to renew or extend the lease at the expiration of the lease term, whether or not the payment would constitute a purchase of the leased property. Note that the definition of lease term includes all periods, if any, for which failure to renew the lease imposes a penalty on the lessee in an amount such that renewal appears, at lease inception, to be reasonably assured. If the lease term has been extended because of that provision, the related penalty is not included in minimum lease payments. Payments made before the beginning of the lease term. The lessee is required to use the same interest rate to accrete payments to be made before the beginning of the lease term that it uses to discount lease payments to be made during the lease term. Fees that are paid by the lessee to the owners of the special-purpose entity for structuring the lease transaction. Such fees are required to be included as part of minimum lease payments (but not included in the fair value of the leased property). Lease payments that depend on a factor directly related to the future use of the leased property, such as machine hours of use or sales volume during the lease term, are contingent rentals and, accordingly, are excluded from minimum lease payments in their entirety. However, lease payments that depend on an existing index or rate, such as the Consumer Price Index or the prime interest rate, are required to be included in minimum lease payments based on the index or rate existing at lease inception; any increases or decreases in lease payments that result from subsequent changes in the index or rate are contingent rentals and, thus, affect the determination of income as accruable.
Used in 1 subtopic:842-50
minimum revenue guarantee
A guarantee granted to a business or its owners that the revenue of the business (or a specific portion of the business) for a specified period of time will be at least a specified minimum amount.
Used in 1 subtopic:460-10
mining entities
Mining entities include entities involved in finding and removing wasting natural resources (other than oil- and gas-producing entities that are within the scope of Topic 932).
Used in 1 subtopic:930-10
Modification
A change in the terms or conditions of a share-based payment award.
Monetary Assets
Money or a claim to receive a sum of money the amount of which is fixed or determinable without reference to future prices of specific goods or services.
Used in 7 subtopics:220-40255-10605-958805-20805-958832-10+1 more
monetary assets or liabilities
Monetary assets and liabilities are assets and liabilities whose amounts are fixed in terms of units of currency by contract or otherwise. Examples are cash, short- or long-term accounts and notes receivable in cash, and short- or long-term accounts and notes payable in cash.
Used in 1 subtopic:845-10
monetary liabilities
An obligation to pay a sum of money the amount of which is fixed or determinable without reference to future prices of specific goods and services.
monetary value
What the fair value of the cash, shares, or other instruments that a financial instrument obligates the issuer to convey to the holder would be at the settlement date under specified market conditions.
Used in 1 subtopic:480-10
Money-over-money
A transaction in which an entity manufactures or purchases an asset, leases the asset to a lessee, and obtains nonrecourse financing in excess of the asset's cost using the leased asset and the future lease rentals as collateral.
Used in 1 subtopic:860-10
morbidity
The relative incidence of disability due to disease or physical impairment.
mortality
The relative incidence of death in a given time or place.
Used in 7 subtopics:605-944715-30805-944944-20944-40944-60+1 more
mortality
The proportion of the number of deaths in a specified group to the number living at the beginning of the period in which the deaths occur. Actuaries use mortality tables, which show death rates for each age, in estimating the amount of pension benefits that will become payable.
Used in 1 subtopic:715-30
mortality risk
The obligation to make payments that are contingent upon the death or continued survival of a specific individual or group.
mortgage banking entity
An entity that is engaged primarily in originating, marketing, and servicing real estate mortgage loans for other than its own account. Mortgage banking entities, as local representatives of institutional lenders, act as correspondents between lenders and borrowers.
mortgage guaranty insurance entities
An insurance entity that issues insurance contracts that guarantee lenders, such as savings and loan associations, against nonpayment by mortgagors.
mortgage-backed securities
Securities issued by a governmental agency or corporation (for example, Government National Mortgage Association [GNMA] or Federal Home Loan Mortgage Corporation [FHLMC]) or by private issuers (for example, Federal National Mortgage Association [FNMA], banks, and mortgage banking entities). Mortgage-backed securities generally are referred to as mortgage participation certificates or pass-through certificates. A participation certificate represents an undivided interest in a pool of specific mortgage loans. Periodic payments on GNMA participation certificates are backed by the U.S. government. Periodic payments on FHLMC and FNMA certificates are guaranteed by those corporations, but are not backed by the U.S. government.
Used in 1 subtopic:310-948
Most Advantageous Market
The market that maximizes the amount that would be received to sell the asset or minimizes the amount that would be paid to transfer the liability, after taking into account transaction costs and transportation costs.
motion picture films
All types of film, including feature films, television specials, television series, or similar products (including animated films and television programming) that are sold, licensed, or exhibited, whether produced on film, video tape, digital, or other video recording format.
Used in 1 subtopic:255-10
Multiemployer Plan
A pension or postretirement benefit plan to which two or more unrelated employers contribute, usually pursuant to one or more collective-bargaining agreements. A characteristic of multiemployer plans is that assets contributed by one participating employer may be used to provide benefits to employees of other participating employers since assets contributed by an employer are not segregated in a separate account or restricted to provide benefits only to employees of that employer. A multiemployer plan is usually administered by a board of trustees composed of management and labor representatives and may also be referred to as a joint trust or union plan. Generally, many employers participate in a multiemployer plan, and an employer may participate in more than one plan. The employers participating in multiemployer plans usually have a common industry bond, but for some plans the employers are in different industries and the labor union may be their only common bond. Some multiemployer plans do not involve a union. For example, local chapters of a not-for-profit entity (NFP) may participate in a plan established by the related national organization.
Multiple-Employer Plan
A pension plan or other postretirement benefit plan maintained by more than one employer but not treated as a multiemployer plan. Multiple-employer plans are generally not collectively bargained and are intended to allow participating employers, commonly in the same industry, to pool their plan assets for investment purposes and to reduce the cost of plan administration. A multiple-employer plan maintains separate accounts for each employer so that contributions provide benefits only for employees of the contributing employer. Multiple-employer plans may have features that allow participating employers to have different benefit formulas, with the employer's contributions to the plan based on the benefit formula selected by the employer.
mutual entities
An entity other than an investor-owned entity that provides dividends, lower costs, or other economic benefits directly and proportionately to its owners, members, or participants. Mutual insurance entities, credit unions, and farm and rural electric cooperatives are examples of mutual entities.
n
Natural Expense Classification
A method of grouping expenses according to the kinds of economic benefits received in incurring those expenses. Examples of natural expense classifications include salaries and wages, employee benefits, professional services, supplies, interest expense, rent, utilities, and depreciation. (P) December 16, 2026; (N) December 16, 2026220-40-65-1A method of grouping expenses according to the types of economic benefits received in incurring those expenses. Examples of natural expense classifications include salaries and wages, employee benefits, nonemployee professional services, supplies, interest expense, rent, utilities, and depreciation.
natural resources
Under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, natural resources are defined as land, fish, wildlife, biota, air, water, groundwater, drinking water supplies, and other such resources belonging to, managed or held in trust by, or otherwise controlled by the United States, state or local governments, foreign governments, or Indian tribes.
Used in 1 subtopic:410-30
near term
A period of time not to exceed one year from the date of the financial statements.
Used in 1 subtopic:275-10
Net Amount at Risk (Relating to Variable Annuity Contracts)
The guaranteed benefit in excess of the current account balance. For guarantees in the event of death, the net amount at risk is the minimum guaranteed amount available to the contract holder upon death in excess of the contract holder's account balance at the balance sheet date. For guarantees of amounts at annuitization, the net amount at risk is defined as the present value of the minimum guaranteed annuity payments available to the contract holder determined in accordance with the terms of the contract in excess of the current account balance.
Used in 1 subtopic:944-40
net asset information
Information regarding the net assets available for benefits.
Net Assets
The excess or deficiency of assets over liabilities of a not-for-profit entity, which is divided into two mutually exclusive classes according to the existence or absence of donor-imposed restrictions. See Net Assets with Donor Restrictions and Net Assets without Donor Restrictions.
Used in 9 subtopics:205-958210-958220-958230-10310-958320-958+3 more
net assets available for benefits
The difference between a plan's assets and its liabilities. For purposes of this definition, a plan's liabilities do not include participants' accumulated plan benefits.
Used in 7 subtopics:205-960310-960325-960325-962325-965960-20+1 more
Net Assets with Donor Restrictions
The part of net assets of a not-for-profit entity that is subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants).
Used in 14 subtopics:205-958210-958220-954220-958230-10310-958+6 more
Net Assets without Donor Restrictions
The part of net assets of a not-for-profit entity that is not subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants).
Used in 16 subtopics:205-958210-954210-958220-954220-958230-10+6 more
net carrying amount of the extinguished debt
Net carrying amount of debt is the amount due at maturity, adjusted for unamortized premium, discount, and cost of issuance.
Used in 1 subtopic:470-50
net cash settlement
A form of settling a financial instrument under which the entity with a loss delivers to the entity with a gain cash equal to the gain.
net closed block liability
The carrying amount of closed block liabilities in excess of the carrying amount of closed block assets each adjusted to eliminate the effect of related amounts in accumulated other comprehensive income at the actuarial calculation date. Deferred acquisition costs are not assets of the closed block.
Used in 1 subtopic:805-944
net income
A measure of financial performance resulting from the aggregation of revenues, expenses, gains, and losses that are not items of other comprehensive income. A variety of other terms such as net earnings or earnings may be used to describe net income.
net income unitrust
A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives distributions during the agreement's term of the lesser of the net income earned by the trust or a fixed percentage of the fair value of the trust's assets, with or without recovery and distribution of the shortfall in a subsequent year. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.
Used in 1 subtopic:958-30
net incurred claims costs
The employer's share of the cost of providing the postretirement health care benefits covered by the plan to a plan participant; incurred claims cost net of retiree contributions. See Incurred Claims Cost (by Age).
Used in 1 subtopic:715-60
Net Investment in the Lease
For a sales-type lease, the sum of the lease receivable and the unguaranteed residual asset. For a direct financing lease, the sum of the lease receivable and the unguaranteed residual asset, net of any deferred selling profit.
net investment in the original loan
The net investment in an original loan includes the unpaid loan principal, any remaining unamortized net fees or costs, any remaining unamortized purchase premium or discount, and any accrued interest receivable.
Used in 1 subtopic:310-20
Net Periodic Pension Cost
The amount recognized in an employer's financial statements as the cost of a pension plan for a period. Components of net periodic pension cost are service cost, interest cost, actual return on plan assets, gain or loss, amortization of prior service cost or credit, and amortization of the transition asset or obligation existing at the date of initial application of Subtopic 715-30. The term net periodic pension cost is used instead of net pension expense because the service cost component recognized in a period may be capitalized as part of an asset such as inventory.
net periodic postretirement benefit cost
The amount recognized in an employer's financial statements as the cost of a postretirement benefit plan for a period. Components of net periodic postretirement benefit cost include service cost, interest cost, actual return on plan assets, gain or loss, amortization of prior service cost or credit, and amortization of the transition obligation or asset.
Net Realizable Value
Estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.
Used in 9 subtopics:270-10275-10310-905330-10330-905360-10+3 more
Net worth
The difference between total assets and total liabilities, after deducting estimated income taxes on the differences between the estimated current values of assets and the estimated current amounts of liabilities and their tax bases.
Used in 1 subtopic:274-10
network affiliation agreements
A broadcaster may be affiliated with a network under a network affiliation agreement. Under the agreement, the station receives compensation for the network programming that it carries based on a formula designed to compensate the station for advertising sold on a network basis and included in network programming. Program costs, a major expense of television stations, are generally lower for a network affiliate than for an independent station because an affiliate does not incur program costs for network programs.
Noncompliance Environmental Credit
(P) December 16, 2027; (N) December 16, 2028818-10-65-1An environmental credit recognized as an asset in accordance with Topic 818 that is not a compliance environmental credit.
nonconsenting class
A class of creditors or stockholders that does not approve the proposed plan.
Used in 1 subtopic:852-10
Noncontributory Plan
A pension or other postretirement benefit plan under which participants do not make contributions.
Used in 1 subtopic:965-10
noncontrolling interest
The portion of equity (net assets) in a subsidiary not attributable, directly or indirectly, to a parent. A noncontrolling interest is sometimes called a minority interest.
Used in 23 subtopics:220-10235-932260-10323-10323-970350-20+6 more
Nonfinancial Asset
An asset that is not a financial asset. Nonfinancial assets include land, buildings, use of facilities or utilities, materials and supplies, intangible assets, or services.
nonforfeiture benefits
Those benefits in a life insurance contract that the policyholder does not forfeit, even for failure to pay premiums. Nonforfeiture benefits usually include cash value, paid-up insurance value, or extended-term insurance value.
Used in 1 subtopic:944-40
nongovernmental entities
An entity that is not required to issue financial reports in accordance with guidance promulgated by the Governmental Accounting Standards Board or the Federal Accounting Standards Advisory Board.
nonintegrated contract features
A contract feature in which the benefits provided are not related or dependent on the provisions of the base contract.
Used in 1 subtopic:944-30
nonmanaging investors
See Nonregistered Investment Partnerships—Financial Highlights.
Used in 1 subtopic:205-946
Nonmember of an Agricultural Cooperative
A nonmember patron is not entitled to voting privileges. A nonmember patron may or may not be entitled to share in patronage distributions, depending on the articles and bylaws of the agricultural cooperative or on other agreements.
Used in 9 subtopics:205-905310-905325-905330-905405-905505-905+3 more
nonmonetary assets or liabilities
Nonmonetary assets and liabilities are assets and liabilities other than monetary ones. Examples are inventories; investments in common stocks; property, plant, and equipment; and liabilities for rent collected in advance.
Used in 1 subtopic:845-10
nonparticipating annuity contract
An annuity contract that does not provide for the purchaser to participate in the investment performance or in other experience of the insurance entity.
Used in 1 subtopic:715-30
nonparticipating insurance contracts
An insurance contract that does not provide for the purchaser to participate in the investment performance or in other experience of the insurance entity. See Insurance Contract.
Nonperformance Risk
The risk that an entity will not fulfill an obligation. Nonperformance risk includes, but may not be limited to, the reporting entity's own credit risk.
Nonprofit Activity
An integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing benefits, other than goods or services at a profit or profit equivalent, as a fulfillment of an entity's purpose or mission (for example, goods or services to beneficiaries, customers, or members). As with a not-for-profit entity, a nonprofit activity possesses characteristics that distinguish it from a business or a for-profit business entity.
Used in 14 subtopics:205-10205-20350-10350-20350-30360-10+6 more
Nonpublic Entity
Any entity that does not meet any of the following conditions: Its debt or equity securities trade in a public market either on a stock exchange (domestic or foreign) or in an over-the-counter market, including securities quoted only locally or regionally. It is a conduit bond obligor for conduit debt securities that are traded in a public market (a domestic or foreign stock exchange or an over-the-counter market, including local or regional markets). It files with a regulatory agency in preparation for the sale of any class of debt or equity securities in a public market. It is required to file or furnish financial statements with the Securities and Exchange Commission. It is controlled by an entity covered by criteria (a) through (d).
Used in 16 subtopics:105-10220-10350-30360-20405-40430-954+6 more
Nonreciprocal Transfer
Nonreciprocal transfer is a transfer of assets or services in one direction, either from an entity to its owners (whether or not in exchange for their ownership interests) or to another entity, or from owners or another entity to the entity. An entity's reacquisition of its outstanding stock is an example of a nonreciprocal transfer.
Used in 14 subtopics:220-40350-10360-972405-20605-958805-20+6 more
nonrefundable minimum guarantee
Amount paid or payable by a customer in a variable fee arrangement that guarantees an entity a minimum fee on that arrangement. Such a guarantee applies to an amount paid by a customer immediately and an amount that the customer has a legally binding commitment to pay over a license period.
Used in 1 subtopic:926-20
Nonretirement Postemployment Benefits
All types of benefits, other than those provided through a pension or other postretirement plan (see Subtopics 715-30 and 715-60), provided to former or inactive employees, their beneficiaries, and covered dependents.
nonutility generators
Entities owning electric generating plants built either for their own energy needs or to sell power, usually to rate-regulated entities, under long-term power sales contracts.
Nonvested benefit information
The actuarial present value of nonvested accumulated plan benefits.
Used in 1 subtopic:960-10
Not-for-Profit Entity
An entity that possesses the following characteristics, in varying degrees, that distinguish it from a business entity: Contributions of significant amounts of resources from resource providers who do not expect commensurate or proportionate pecuniary return Operating purposes other than to provide goods or services at a profit Absence of ownership interests like those of business entities. Entities that clearly fall outside this definition include the following: All investor-owned entities Entities that provide dividends, lower costs, or other economic benefits directly and proportionately to their owners, members, or participants, such as mutual insurance entities, credit unions, farm and rural electric cooperatives, and employee benefit plans.
Used in 62 subtopics:205-20205-958210-958220-40220-958230-958+6 more
o
obligated to write
A circumstance in which an entity has no discretion to cancel a policy because of legal obligation under state statute, contract terms, or regulatory practice and is required to offer or issue insurance policies for a period in the future.
Used in 1 subtopic:405-30
Obligation
A conditional or unconditional duty or responsibility to transfer assets or to issue equity shares. Because Topic 480 relates only to financial instruments and not to contracts to provide services and other types of contracts, but includes duties or responsibilities to issue equity shares, this definition of obligation differs from the definition found in FASB Concepts Statement No. 6, Elements of Financial Statements, and is applicable only for items in the scope of that Topic. (P) December 16, 2024; (N) December 16, 2025105-10-65-9A conditional or unconditional duty or responsibility to transfer assets or to issue equity shares. This definition is applicable only for items within the scope of Topic 480.
Used in 1 subtopic:480-10
obligation callable
An obligation is callable at a given date if the creditor has the right at that date to demand, or to give notice of its intention to demand, repayment of the obligation owed to it by the debtor.
Used in 1 subtopic:470-10
Obligations subject to compromise
Includes all prepetition liabilities (claims) except those that will not be impaired under the plan, such as claims in which the value of the security interest is greater than the claim.
Used in 1 subtopic:852-10
Observable Inputs
Inputs that are developed using market data, such as publicly available information about actual events or transactions, and that reflect the assumptions that market participants would use when pricing the asset or liability.
Used in 1 subtopic:820-10
Offering Costs
Offering costs include all of the following: Legal fees pertaining to the investment company's shares offered for sale Securities and Exchange Commission (SEC)and state registration fees Underwriting and other similar costs Costs of printing prospectuses for sales purposes Initial fees paid to be listed on an exchange Tax opinion costs related to offering of shares Initial agency fees of securing the rating for bonds or preferred stock issued by closed-end funds.
Oil- and Gas-Producing Activities
Paragraph 932-10-15-2A defines the term oil- and gas-producing activities.
One-Time Employee Termination Benefits
Benefits provided to current employees that are involuntarily terminated under the terms of a one-time benefit arrangement.
ongoing economic interest in the net assets of the other
A residual right to another not-for-profit entity's (NFP's) net assets that results from an ongoing relationship. The value of those rights increases or decreases as a result of the investment, fundraising, operating, and other activities of the other entity.
Used in 1 subtopic:958-20
open year method
A revenue recognition method under which underwriting results of foreign reinsurance are not included in the income statement until sufficient information becomes available to provide reasonable estimates of earned premiums.
Used in 1 subtopic:605-944
operating activities
Operating activities include all transactions and other events that are not defined as investing or financing activities (see paragraphs 230-10-45-12230-10-45-13230-10-45-14230-10-45-15). Operating activities generally involve producing and delivering goods and providing services. Cash flows from operating activities are generally the cash effects of transactions and other events that enter into the determination of net income.
Used in 1 subtopic:230-10
operating cycle
The average time intervening between the acquisition of materials or services and the final cash realization constitutes an operating cycle.
Operating Lease
From the perspective of a lessee, any lease other than a finance lease. From the perspective of a lessor, any lease other than a sales-type lease or a direct financing lease.
Used in 9 subtopics:220-40340-970450-30805-20810-10842-10+3 more
operating segment
A component of a public entity. See Section 280-10-50 for additional guidance on the definition of an operating segment.
Option
Unless otherwise stated, a call option that gives the holder the right to purchase shares of common stock from the reporting entity in accordance with an agreement upon payment of a specified amount. Options include, but are not limited to, options granted and stock purchase agreements entered into with grantees. Options are considered securities. See Call Option.
orchard
Fruit trees planted in geometric patterns to economically facilitate care of the trees and harvest of the fruit. See also Grove.
Used in 1 subtopic:360-905
Orderly Transaction
A transaction that assumes exposure to the market for a period before the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets or liabilities; it is not a forced transaction (for example, a forced liquidation or distress sale).
Used in 15 subtopics:321-10326-20326-30350-60805-60818-10+6 more
ordinary course of business
See paragraph 942-210-S99-1, Regulation S-X Rule 9-03(7)(e)(4), for the definition of ordinary course of business for the purpose of Regulation S-X Rule 9-03.
Ordinary Income (or Loss)
Ordinary income (or loss) refers to income (or loss) from continuing operations before income taxes (or benefits) excluding significant unusual or infrequently occurring items. Discontinued operations and cumulative effects of changes in accounting principles are also excluded from this term. The term is not used in the income tax context of ordinary income versus capital gain. The meaning of unusual or infrequently occurring items is consistent with their use in the definitions of the terms unusual nature and infrequency of occurrence.
Used in 1 subtopic:270-740
original contract
A contract that was initially entered into by the contract holder before any potential internal replacement activity.
originator's acquisition cost
Costs incurred by a mortgage banking entity that originates mortgage loans for a lender that intends to hold the loans to maturity.The originator's acquisition cost is equal to the principal amount of the loan adjusted for unamortized net fees and costs and any unearned discounts or premiums.
Used in 1 subtopic:310-948
other comprehensive income
Revenues, expenses, gains, and losses that under generally accepted accounting principles (GAAP) are included in comprehensive income but excluded from net income.
Used in 8 subtopics:220-10815-10815-15815-20815-25815-30+2 more
Other Postemployment Benefits
Benefits, other than special or contractual termination benefits, that are provided by an employer to former or inactive employees after employment but before retirement including benefits provided to beneficiaries and covered dependents.
Other Price Risk
The risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer or by factors affecting all similar financial instruments traded in the market.
Used in 1 subtopic:820-10
overall deal
An arrangement in which an entity compensates a producer or other creative individual for the exclusive or preferential use of that party's creative services.
Owners
Used broadly to include holders of ownership interests (equity interests) of investor-owned entities, mutual entities, or not-for-profit entities. Owners include shareholders, partners, proprietors, or members or participants of mutual entities. Owners also include owner and member interests in the net assets of not-for-profit entities.
owners association
A body of owners formed to administer the rules and regulations of a time-sharing project. Also denoted homeowners association, interval owners association, property owners association, or vacation owners association.
Used in 1 subtopic:720-978
p
Paper tickets
A printed document that serves as evidence of payment of the fare for air transportation. It authorizes carriage between the points and via the routing indicated and also shows the passenger's name, class of service, carrier(s), flight number(s), dates of travel, and all conditions of the contract of carriage. Generally, this takes the form of the standard Air Traffic Conference ticket, which is composed of an auditor's coupon, agent's coupon, flight coupon(s), and passenger's coupon. The auditor's coupon is the initial document used to record a sale. Flight coupons represent each flight segment (leg) of the passenger's itinerary. Flight coupons are lifted (detached from the ticket booklet) by the carrier providing the transportation service at the boarding point as evidence of the service rendered, although today this process is entirely electronic for the vast majority of ticket sales and boarding transactions.
Used in 1 subtopic:908-10
parent
An entity that has a controlling financial interest in one or more subsidiaries. (Also, an entity that is the primary beneficiary of a variable interest entity.)
Used in 9 subtopics:220-10235-932323-10405-942480-10610-20+3 more
parity adjustment
The effect of the difference between local and U.S. inflation for the year on net assets (that is, shareholders' equity) measured in nominal dollars. If only the differential rates of U.S. and local inflation are reflected in the exchange rates (parity), the parity adjustment and the translation adjustment net to zero. Therefore, the sum of the parity adjustment and the translation adjustment represents the effect of exchange rate changes in excess of (or less than) that needed to maintain purchasing power parity between the functional currency and the dollar.
Used in 1 subtopic:255-10
Participant
Any employee or former employee, or any member or former member of a trade or other employee association, or the beneficiaries of those individuals, for whom there are pension plan benefits or other accumulated plan benefits.
participating annuity contract
An annuity contract that provides for the purchaser to participate in the investment performance and possibly other experience (for example, mortality experience) of the insurance entity. Under a participating annuity contract, the insurance entity ordinarily pays dividends to the purchaser.
Used in 1 subtopic:715-30
Participating Insurance
Insurance in which the policyholder is entitled to participate in the earnings or surplus of the insurance entity. The participation occurs through the distribution of dividends to policyholders.
Participating Interest
Paragraph 860-10-40-6A defines the term participating interest.
Participating Potentially Responsible Party
A party to a Superfund site that has acknowledged potential involvement with respect to the site. Active potentially responsible parties may participate in the various administrative, negotiation, monitoring, and remediation activities related to the site. Others may adopt a passive stance and simply monitor the activities and decisions of the more involved potentially responsible parties. This passive stance could result from a variety of factors such as the entity's lack of experience, limited internal resources, or relative involvement at a site. This category of potentially responsible parties (both active and passive) is also referred to as players.
Used in 1 subtopic:410-30
Participating Rights (VIE definition)
The ability to block or participate in the actions through which an entity exercises the power to direct the activities of a VIE that most significantly impact the VIE's economic performance. Participating rights do not require the holders of such rights to have the ability to initiate actions.
Used in 1 subtopic:810-10
Participating Rights (Voting Interest Entity definition)
Participating rights allow the limited partners or noncontrolling shareholders to block or participate in certain significant financial and operating decisions of the limited partnership or corporation that are made in the ordinary course of business. Participating rights do not require the holders of such rights to have the ability to initiate actions.
participating security
A security that may participate in undistributed earnings with common stock, whether that participation is conditioned upon the occurrence of a specified event or not. The form of such participation does not have to be a dividend—that is, any form of participation in undistributed earnings would constitute participation by that security, regardless of whether the payment to the security holder was referred to as a dividend.
Used in 1 subtopic:260-10
participation costs
Parties involved in the production of a film may be compensated in part by contingent payments based on the financial results of a film pursuant to contractual formulas (participations) and by contingent amounts due under provisions of collective bargaining agreements (residuals). Such parties are collectively referred to as participants, and such costs are collectively referred to as participation costs. Participations may be given to creative talent, such as actors or writers, or to entities from whom distribution rights are licensed.
Participation Right
A purchaser's right under a participating insurance contract to receive future dividends or retroactive rate credits from the insurance entity.
participation rights
Contractual rights of security holders to receive dividends or returns from the security issuer's profits, cash flows, or returns on investments.
Used in 1 subtopic:505-10
patronage
The amount of business done with a cooperative by one of its patrons. Patronage is measured by either the quantity or value of commodities received from patrons by a marketing cooperative and the quantity or value of the goods and services sold to patrons by a supply cooperative.
patronage allocation
Patronage earnings distributed, or allocated, to individual patrons on the basis of each patron's proportionate share of total patronage. Such allocations, which include notification to the patron, may be made on a qualified or nonqualified basis.
Used in 1 subtopic:605-905
patronage earnings
The excess of a cooperative's revenues over its costs arising from transactions done with or for its patrons. Generally a significant portion of those earnings is allocated to the cooperative's patrons in the form of cash, allocated equities, or both.
Patrons
Any individual, trust, estate, partnership, corporation, or agricultural cooperative with or for whom a cooperative does business on a cooperative basis, whether a member of an agricultural cooperative or nonmember of an agricultural cooperative.
Used in 9 subtopics:205-905310-905325-905330-905405-905505-905+3 more
payment provision
A payment provision specifies a fixed or determinable settlement to be made if the underlying behaves in a specified manner.
Used in 1 subtopic:815-10
payment-in-kind bonds
Bonds in which the issuer has the option at each interest payment date of making interest payments in cash or in additional debt securities. Those additional debt securities are referred to as baby or bunny bonds. Baby bonds generally have the same terms, including maturity dates and interest rates, as the original bonds (parent payment-in-kind bonds). Interest on baby bonds may also be paid in cash or in additional like-kind debt securities at the option of the issuer.
Used in 1 subtopic:320-946
Payout Phase
The period during which the contract holder is receiving periodic payments from an annuity, also referred to as the annuitization phase.
Penalty
Any requirement that is imposed or can be imposed on the lessee by the lease agreement or by factors outside the lease agreement to do any of the following: Disburse cash Incur or assume a liability Perform services Surrender or transfer an asset or rights to an asset or otherwise forego an economic benefit, or suffer an economic detriment. Factors to consider in determining whether an economic detriment may be incurred include, but are not limited to, all of the following: The uniqueness of purpose or location of the underlying asset The availability of a comparable replacement asset The relative importance or significance of the underlying asset to the continuation of the lessee's line of business or service to its customers The existence of leasehold improvements or other assets whose value would be impaired by the lessee vacating or discontinuing use of the underlying asset Adverse tax consequences The ability or willingness of the lessee to bear the cost associated with relocation or replacement of the underlying asset at market rental rates or to tolerate other parties using the underlying asset.
Used in 1 subtopic:842-10
Pension Benefits
Periodic (usually monthly) payments made pursuant to the terms of the pension plan to a person who has retired from employment or to that person's beneficiary.
Used in 7 subtopics:205-960220-40715-30715-80960-10960-20+1 more
Pension Fund
The assets of a pension plan held by a funding agency.
per capita claims cost by age
The current cost of providing postretirement health care benefits for one year at each age from the youngest age to the oldest age at which plan participants are expected to receive benefits under the plan. See Assumed per Capita Claims Cost (By Age).
Used in 1 subtopic:715-60
Performance Condition
A condition affecting the vesting, exercisability, exercise price, or other pertinent factors used in determining the fair value of an award that relates to both of the following: Rendering service or delivering goods for a specified (either explicitly or implicitly) period of time Achieving a specified performance target that is defined solely by reference to the grantor's own operations (or activities) or by reference to the grantee's performance related to the grantor's own operations (or activities).Attaining a specified growth rate in return on assets, obtaining regulatory approval to market a specified product, selling shares in an initial public offering or other financing event, and a change in control are examples of performance conditions. A performance target also may be defined by reference to the same performance measure of another entity or group of entities. For example, attaining a growth rate in earnings per share (EPS) that exceeds the average growth rate in EPS of other entities in the same industry is a performance condition. A performance target might pertain to the performance of the entity as a whole or to some part of the entity, such as a division, or to the performance of the grantee if such performance is in accordance with the terms of the award and solely relates to the grantor's own operations (or activities).(P) December 16, 2026; (N) December 16, 2026606-10-65-2For share-based payments in which a grantor acquires goods or services to be used or consumed in the grantor’s own operations, a condition affecting the vesting, exercisability, exercise price, or other pertinent factors used in determining the fair value of an award that relates to both of the following: Rendering service or delivering goods for a specified (either explicitly or implicitly) period of time Achieving a specified performance target that is defined solely by reference to the grantor's own operations (or activities) or by reference to the grantee's performance related to the grantor's own operations (or activities).Attaining a specified growth rate in return on assets, obtaining regulatory approval to market a specified product, selling shares in an initial public offering or other financing event, and a change in control are examples of performance conditions. A performance target also may be defined by reference to the same performance measure of another entity or group of entities. For example, attaining a growth rate in earnings per share (EPS) that exceeds the average growth rate in EPS of other entities in the same industry is a performance condition. A performance target might pertain to the performance of the entity as a whole or to some part of the entity, such as a division, or to the performance of the grantee if such performance is in accordance with the terms of the award and solely relates to the grantor's own operations (or activities).For share-based consideration payable to a customer that can result in a reduction of the transaction price in accordance with Topic 606, a condition affecting the vesting, exercisability, exercise price, or other pertinent factors used in determining the fair value of an award that relates to any of the following:Achieving a specified performance target that is defined solely by reference to the grantor’s own operations (or activities) or by reference to the grantee’s (the customer’s) performance related to the grantor’s own operations (or activities)The grantee’s purchase (or potential purchase) of the grantor’s goods or services from either the grantor or the grantor’s customersA purchase (or potential purchase) of the grantor’s goods or services from either the grantee or the grantee’s customers.The performance targets listed in this definition for employee and nonemployee awards (for example, a change in control) are also examples of performance conditions for share-based consideration payable to a customer.
Performance Indicator
A performance indicator reports results of operations. A performance indicator and the income from continuing operations reported by for-profit health care entities generally are consistent, except for transactions that clearly are not applicable to one kind of entity (for example, for-profit health care entities typically would not receive contributions, and not-for-profit health care entities would not award stock compensation). That is, a performance indicator is analogous to income from continuing operations of a for-profit entity.
Performance Obligation
A promise in a contract with a customer to transfer to the customer either: A good or service (or a bundle of goods or services) that is distinct A series of distinct goods or services that are substantially the same and that have the same pattern of transfer to the customer.
Used in 14 subtopics:270-10275-10310-912340-40360-10460-10+6 more
Performance Requirements
(P) December 16, 2027; (N) December 16, 2027 350-40-65-4 Performance requirements are what an entity needs the software to do (for example, functions or features).
Used in 1 subtopic:350-40
Performance standby letters of credit
An irrevocable undertaking by a guarantor to make payments in the event a specified third party fails to perform under a nonfinancial contractual obligation.
Used in 1 subtopic:460-10
Period of Use
The total period of time that an asset is used to fulfill a contract with a customer (including the sum of any nonconsecutive periods of time).
Used in 1 subtopic:842-10
periodic ratchet design
A type of equity-indexed annuity. See paragraph 815-15-55-63(a).
Used in 1 subtopic:815-15
Permanent Investor
An entity that invests in mortgage loans for its own account, for example, an insurance entity, commercial or mutual savings bank, savings and loan association, pension plan, real estate investment trust, or Federal National Mortgage Association (FNMA).
perpetual trust held by a third party
An arrangement in which a donor establishes and funds a perpetual trust administered by an individual or entity other than the not-for-profit entity (NFP) that is the beneficiary. Under the terms of the trust, the NFP has the irrevocable right to receive the income earned on the trust assets in perpetuity, but never receives the assets held in trust. Distributions received by the NFP may be restricted by the donor.
Used in 1 subtopic:605-958
persistency
The complement of the termination rate, persistency is the renewal quality of insurance contracts, that is, the number of insureds that keep their insurance in force during a period. Persistency varies by plan of insurance, age at issue, year of issue, frequency of premium payment, and other factors.
persistency bonus
A sales inducement credited to the contract holder account balance at the end of a specified period if the contract remains in force at that date, thus increasing the account value at the end of the specified period.
petition
A document filed in a court of bankruptcy, initiating proceedings under the Bankruptcy Code.
Phase
A contractually or physically distinguishable portion of a real estate project (including time-sharing projects). That portion is distinguishable from other portions based on shared characteristics such as: Units a developer has declared or legally registered to be for sale Units linked to an owners association Units to be constructed during a particular time period How a developer plans to build the real estate project.
phase-in plans
Any method of recognition of allowable costs in rates that meets all of the following criteria: The method was adopted by the regulator in connection with a major, newly completed plant of the regulated entity or of one of its suppliers or a major plant scheduled for completion in the near future. The method defers the rates intended to recover allowable costs beyond the period in which those allowable costs would be charged to expense under generally accepted accounting principles (GAAP) applicable to entities in general. The method defers the rates intended to recover allowable costs beyond the period in which those rates would have been ordered under the rate-making methods routinely used prior to 1982 by that regulator for similar allowable costs of that regulated entity.
physical settlement
A form of settling a financial instrument under which both of the following conditions are met: The party designated in the contract as the buyer delivers the full stated amount of cash or other financial instruments to the seller. The seller delivers the full stated number of shares of stock or other financial instruments or nonfinancial instruments to the buyer.
plan administrators
The person or group of persons responsible for the content and issuance of a plan's financial statements in much the same way that management is responsible for the content and issuance of a business entity's financial statements.
Plan Amendment
A change in the existing terms of a plan or the initiation of a new plan. A plan amendment may increase benefits (a positive plan amendment), or reduce or eliminate benefits (a negative plan amendment), including those benefits attributed to years of service already rendered.
Plan Assets
Assets—usually stocks, bonds, and other investments—that have been segregated and restricted, usually in a trust, to provide for pension benefits. The amount of plan assets includes amounts contributed by the employer, and by employees for a contributory plan, and amounts earned from investing the contributions, less benefits paid. Plan assets ordinarily cannot be withdrawn by the employer except under certain circumstances when a plan has assets in excess of obligations and the employer has taken certain steps to satisfy existing obligations. Assets not segregated in a trust or otherwise effectively restricted so that they cannot be used by the employer for other purposes are not plan assets even though it may be intended that such assets be used to provide pensions. If a plan has liabilities other than for benefits, those nonbenefit obligations may be considered as reductions of plan assets. Amounts accrued by the employer but not yet paid to the plan are not plan assets. Securities of the employer held by the plan are includable in plan assets provided they are transferable.
Used in 11 subtopics:205-960205-965310-965325-965360-965715-30+5 more
plan demographics
The characteristics of the plan population including geographical distribution, age, sex, and marital status.
Used in 1 subtopic:715-60
plan of demutualization
The plan of reorganization, including all exhibits and schedules thereto, as it may be amended from time to time, that is adopted by the board of directors of the demutualizing entity, pursuant to which the entity demutualizes.
Used in 1 subtopic:805-944
Plan of Reorganization
An agreement formulated in Chapter 11 proceedings under the supervision of the Bankruptcy Court that enables the debtor to continue in business. The plan, once confirmed, may affect the rights of undersecured creditors, secured creditors, and stockholders as well as those of unsecured creditors. Before a plan is confirmed by the Bankruptcy Court, it must comply with general provisions of the Bankruptcy Code. Those provisions mandate, for example, that the plan is feasible, the plan is in the best interest of the creditors, and, if an impaired class does not accept the plan, the plan must be determined to be fair and equitable before it can be confirmed.
Used in 1 subtopic:852-10
plan participant
Any employee or former employee who has rendered service in the credited service period and is expected to receive employer-provided benefits under the postretirement benefit plan, including benefits to or for any beneficiaries and covered dependents. See Active Plan Participant.
Used in 1 subtopic:715-60
plan suspension
An event in which the pension plan is frozen and no further benefits accrue. Future service may continue to be the basis for vesting of nonvested benefits existing at the date of suspension. The plan may still hold assets, pay benefits already accrued, and receive additional employer contributions for any unfunded benefits. Employees may or may not continue working for the employer.
Used in 1 subtopic:715-30
Plan Termination
An event in which the pension plan or postretirement benefit plan ceases to exist and all benefits are settled by the purchase of insurance contracts (for example, annuities) or by other means. The plan may or may not be replaced by another plan. A plan termination with a replacement plan may or may not be in substance a plan termination for accounting purposes.
plan's benefit formula
The basis for determining payments to which participants may be entitled under a pension plan. Pension benefit formulas usually refer to the employee's service or compensation or both. Sometimes referred to as a plan's benefit formula or benefit formula.
Used in 1 subtopic:715-30
Planned-unit developments
A real estate development that consists of separate lots with contiguous or noncontiguous common areas and facilities owned and maintained by a common interest realty association in which owners have stock or a membership interest.
Used in 1 subtopic:972-10
plans
An arrangement that is mutually understood by an employer and its employees, whereby an employer undertakes to provide its employees with benefits after they retire in exchange for their services over a specified period of time, upon attaining a specified age while in service, or a combination of both. A plan may be written or it may be implied by a well-defined, although perhaps unwritten, practice of paying postretirement benefits or from oral representations made to current or former employees. See Substantive Plan.
Used in 1 subtopic:715-60
point-to-point design
A type of equity-indexed annuity. See paragraph 815-15-55-63(b).
Used in 1 subtopic:815-15
points
Purchased vacation credits that a buyer may redeem for occupancy at various sites. The number of points redeemed depends on such factors as unit type and size, site location, and season.
Used in 1 subtopic:978-10
Policy account balance
At any point in time, this is the amount held by the insurance entity on behalf of the policyholder. This balance may be held in a general account, a separate account (a legally segregated account), or a combination of both on the insurance entity's balance sheet. This account includes premiums received from the policyholder, plus any credited income, less any relevant charges (acquisition costs, cost of insurance, and so forth). (Note: The use of this glossary term is not consistent among legal contracts. When determining the applicability of this term, the economic substance of the item shall be taken into consideration.)
policy credits
Additional values applied to a policy through dividends, increases in fund values, accumulation values or accumulation account values or extensions of coverages.
Used in 1 subtopic:805-944
Pooled income funds
A trust in which donors are assigned a specific number of units based on the proportion of the fair value of their contributions to the total fair value of the pooled income fund on the date of the donor's entry to the pooled fund. Until a donor's death, the donor (or the donor's designated beneficiary or beneficiaries) is paid the actual income (as defined under the arrangement) earned on the donor's assigned units. Upon the donor's death, the value of these assigned units reverts to the NFP.
Used in 1 subtopic:958-30
pooling cooperatives
A marketing cooperative that receives its members' agricultural products without obligation to pay a fixed price and commingles those products into single or multiple pools for processing and marketing purposes. Pool periods may vary from a week to a year or longer, depending on the product involved. Generally profits or losses are allocated to patrons upon closing of the pool.
Used in 1 subtopic:330-905
pools
Pools are accounting control centers used for determining earnings and patronage refunds due to particular patrons, including the following: An open pool is an accounting control center that is not closed at the end of each accounting period. Open pools are sometimes used by marketing cooperatives for crops that may not be sold for two or more years after their receipt from patrons. A single pool cooperative determines net proceeds or patronage refunds on the basis of overall operating results for all commodities marketed during an accounting period. A multiple pool cooperative determines net proceeds or patronage refunds on the basis of separate commodities, departments, or accounting periods.
Portfolio Segment
The level at which an entity develops and documents a systematic methodology to determine its allowance for credit losses. See paragraphs 326-20-50-3 and 326-20-55-10.
postpetition liabilities
Liabilities incurred after the filing of a petition that are not associated with prebankruptcy events. Thus, these liabilities are not considered prepetition liabilities.
Used in 1 subtopic:852-10
Postretirement Benefits
All forms of benefits, other than retirement income, provided by an employer to retirees. Those benefits may be defined in terms of specified benefits, such as health care, tuition assistance, or legal services, that are provided to retirees as the need for those benefits arises, such as certain health care benefits, or they may be defined in terms of monetary amounts that become payable on the occurrence of a specified event, such as life insurance benefits.
postretirement benefits other than pensions
See Postretirement Benefits.
postretirement health care benefits
A form of postretirement benefit provided by an employer to retirees for defined health care services or coverage of defined health care costs, such as hospital and medical coverage, dental benefits, and eye care.
Used in 1 subtopic:715-60
potential common stock
A security or other contract that may entitle its holder to obtain common stock during the reporting period or after the end of the reporting period.
Used in 1 subtopic:260-10
Potentially Responsible Party
Any individual, legal entity, or government—including owners, operators, transporters, or generators—potentially responsible for, or contributing to, the environmental impacts at a Superfund site. The Environmental Protection Agency has the authority to require potentially responsible parties, through administrative and legal actions, to remediate such sites. At early stages of the remediation process, the list of potentially responsible parties may be limited to a handful of entities that either were significant contributors of waste to the site or were easy to identify, for example, because of their proximity to the site or because of labeled material found at the site. As further investigation of the site occurs and as remediation activities take place, additional potentially responsible parties may be identified. Once identified, the additional potentially responsible parties would be reclassified from this category to either the participating potentially responsible party or recalcitrant potentially responsible party category. The total number of parties in this category and their aggregate allocable share of the remediation liability varies by site and cannot be reliably determined before the specific identification of individual potentially responsible parties. For example, some ultimately may be dropped from the potentially responsible party list because no substantive evidence is found to link them to the site. For others, substantive evidence eventually may be found that points to their liability. The presentation of that evidence to the entity would result in a reclassification of the party from this category of potentially responsible parties (sometimes referred to as hiding in the weeds) to either the participating potentially responsible party or recalcitrant potentially responsible party category.
Used in 1 subtopic:410-30
preacquisition costs
Costs related to a property that are incurred for the express purpose of, but prior to, obtaining that property. Examples of preacquisition costs may be costs of surveying, zoning or traffic studies, or payments to obtain an option on the property.
preferred stock
A security that has preferential rights compared to common stock.
Preferred Stock Subject to Mandatory Redemption Requirements or Whose Redemption is Outside the Control of the Issuer
See paragraph 480-10-S99-1, CFRR 211.02, for definition of preferred stock subject to mandatory redemption requirements or whose redemption is outside the control of the issuer.
Used in 1 subtopic:480-10
Preferred Stocks Which Are Not Redeemable or Are Redeemable Solely at the Option of the Issuer
See paragraph 480-10-S99-1, CFRR 211.02, for the definition of preferred stocks which are not redeemable or are redeemable solely at the option of the issuer.
Used in 1 subtopic:480-10
preliminary project stage
When a computer software project is in the preliminary project stage, entities will likely do the following: Make strategic decisions to allocate resources between alternative projects at a given point in time. For example, should programmers develop a new payroll system or direct their efforts toward correcting existing problems in an operating payroll system? Determine the performance requirements (that is, what it is that they need the software to do) and systems requirements for the computer software project it has proposed to undertake. Invite vendors to perform demonstrations of how their software will fulfill an entity's needs. Explore alternative means of achieving specified performance requirements. For example, should an entity make or buy the software? Should the software run on a mainframe or a client server system? Determine that the technology needed to achieve performance requirements exists. Select a vendor if an entity chooses to obtain software. Select a consultant to assist in the development or installation of the software. (P) December 16, 2027; (N) December 16, 2027350-40-65-4Paragraph superseded by Accounting Standards Update No. 2025-06.
Used in 1 subtopic:350-40
prematurity period
During the prematurity period, the cable television system is partially under construction and partially in service. The prematurity period begins when revenue from the first subscriber is recognized in accordance with Topic 606 on revenue from contracts with customers.Its end will vary with circumstances of the system but will be determined based on plans for completion of the first major construction period or achievement of a specified predetermined subscriber level at which no additional investment will be required for other than cable television plant. The construction period of a cable television system varies with the size of the franchise area, density of population, and difficulty of physical construction. The construction period is not completed until the head-end, main cable, and distribution cables are installed, and includes a reasonable time to provide for installation of subscriber drops and related hardware. During the construction period, many system operators complete installation of drops and begin to provide service to some subscribers in some parts of the system while construction continues. Providing the signal for the first time is referred to as energizing the system. The length of the prematurity period varies with the franchise development and construction plans. Such plans may consist of any of the following: Small franchise that is characterized by the absence of free television signal and a short construction period. The entire system is energized at one time near the end of the construction period. Medium-size franchise that is characterized by some direct competition from free television and by a more extensive geographical franchise area lending itself to incremental construction. Some parts of the system are energized as construction progresses. Large metropolitan franchise that is characterized by heavy direct competition from free television and fringe area signal inadequacy, high cost, and difficult construction. Many parts of the system are energized as construction progresses. Except in the smallest systems, programming is usually delivered to portions of the system and some revenues are obtained before construction of the entire system is complete. Thus, virtually every cable television system experiences a prematurity period during which it is receiving some revenue while continuing to incur substantial costs related to the establishment of the total system.
Preoperating costs
Preoperating costs include flight crew training, maintenance training, prerevenue flight expenses, insurance, and depreciation. Preoperating costs relate directly to specific preoperating projects, such as the preparation for operation of new routes or integration of new types of aircraft.
Used in 1 subtopic:720-908
prepaid health care services
Any form of health care service provided to a member in exchange for a scheduled payment (or payments) established before care is provided, regardless of the level of service subsequently provided.
prepaid interest rate swap
A prepaid interest rate swap contract obligates one party to make periodic payments to another party that are based on a variable interest rate applied to an effective notional amount. It is characterized as an at-the-money interest rate swap for which the fixed leg has been fully prepaid, with the result that the party that receives the variable-leg-based payments has no obligation whatsoever to make any future payments under the swap. Under that characterization, the fair value of the fixed leg and the fair value of the variable leg are equal and offsetting because the at-the-money interest rate swap has an overall fair value of zero.
Used in 1 subtopic:815-10
prepayable
Able to be settled by either party before its scheduled maturity.
prepetition liabilities
Liabilities that were incurred by an entity before its filing of a petition for protection under the Bankruptcy Code including those considered by the Bankruptcy Court to be prepetition claims, such as a rejection of a lease for real property.
Used in 1 subtopic:852-10
Present Value
A tool used to link future amounts (cash flows or values) to a present amount using a discount rate (an application of the income approach). Present value techniques differ in how they adjust for risk and in the type of cash flows they use. See Discount Rate Adjustment Technique.
Used in 1 subtopic:820-10
Preset participation method
Liquidation method used to allocate principal payments on receivables in a trust to investors. The preset participation method is similar to the fixed participation method except that the percentage used to determine the principal payments allocated to the investors is preset higher than the investors' expected participation interests in the receivables in the trust at the end of the reinvestment period. This method results in a faster payout to the investors than the fixed participation method because a higher percentage of the principal payments is allocated to the investors.
Used in 1 subtopic:860-10
price adjustment theory
The distribution of earnings on the basis of patronage.
Used in 1 subtopic:905-10
Principal Market
The market with the greatest volume and level of activity for the asset or liability.
principal owners
Owners of record or known beneficial owners of more than 10 percent of the voting interests of the entity.
Used in 1 subtopic:850-10
Principal-to-Principal Market
A market in which transactions, both originations and resales, are negotiated independently with no intermediary. Little information about those transactions may be made available publicly.
Used in 1 subtopic:820-10
Prior Service Cost
The cost of retroactive benefits granted in a plan amendment. Retroactive benefits are benefits granted in a plan amendment (or initiation) that are attributed by the benefit formula to employee services rendered in periods before the amendment.
Private Company
An entity other than a public business entity, a not-for-profit entity, or an employee benefit plan within the scope of Topics 960 through 965 on plan accounting.
Used in 8 subtopics:220-40323-10350-20805-20805-30805-60+2 more
private label credit card
Private label credit cards are those credit cards that are issued by, or on behalf of, a merchandising entity for the purchase of goods or services that are sold at that entity's place(s) of business.
Used in 1 subtopic:310-20
Probable
The future event or events are likely to occur.
Used in 34 subtopics:205-20205-40310-10310-20323-740325-30+6 more
probable
Probable reserves are reserves for which quantity and grade and/or quality are computed from information similar to that used for proven reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observation.
Proceeds
Cash, beneficial interests, servicing assets, derivative instruments, or other assets that are obtained in a transfer of financial assets, less any liabilities incurred.
Used in 1 subtopic:860-20
producer
An individual or an entity that produces and has a financial interest in films for exhibition in movie theaters, on television, or elsewhere.
Used in 1 subtopic:926-20
product design
A logical representation of all product functions in sufficient detail to serve as product specifications.
Used in 1 subtopic:985-20
product enhancement
Improvements to an existing product that are intended to extend the life or improve significantly the marketability of the original product. Enhancements normally require a product design and may require a redesign of all or part of the existing product.
Used in 1 subtopic:985-20
Product financing arrangements
A product financing arrangement is a transaction in which an entity sells and agrees to repurchase inventory with the repurchase price equal to the original sale price plus carrying and financing costs, or other similar transactions.
Used in 1 subtopic:470-40
product maintenance contracts
An agreement to perform certain agreed-upon services to maintain a product for a specified period of time. The terms of the contract may take different forms, such as an agreement to periodically perform a particular service a specified number of times over a specified period of time, or an agreement to perform a particular service as the need arises over the term of the contract.
Used in 1 subtopic:605-20
product masters
A completed version, ready for copying, of the computer software product, the documentation, and the training materials that are to be sold, leased, or otherwise marketed.
Production
Production involves lifting the crude oil and natural gas to the surface, extracting saleable hydrocarbons, in the solid, liquid, or gaseous state from oil sands, shale, coalbeds, or other nonrenewable natural resources that are intended to be upgraded into synthetic oil or gas, gathering, treating, field processing (as in the case of processing gas to extract liquid hydrocarbons), and field storage. The oil and gas production function shall be regarded as ending at a terminal point, which is the outlet valve on the lease or field storage tank. If unusual physical or operational circumstances exist, it may be appropriate to regard the terminal point for the production function as: The first point at which oil, gas, or gas liquids, natural or synthetic, are delivered to a main pipeline, a common carrier, a refinery, or a marine terminal In the case of natural resources that are intended to be upgraded into synthetic oil or gas, if those natural resources are delivered to a purchaser before upgrading, the first point at which the natural resources are delivered to a main pipeline, a common carrier, a refinery, a marine terminal, or a facility that upgrades such natural resources into synthetic oil or gas.
Used in 8 subtopics:235-932360-932470-932720-932810-932815-932+2 more
production animals
Production animals provide a service or primary product other than their progeny. Examples are dairy cows (milk), poultry (meat and eggs), and sheep (meat and wool).
Production Costs
See paragraph 932-10-S99-1, Regulation S-X Rule 4-10(a)(20), for the definition of production costs as used within that Rule.
Used in 1 subtopic:932-10
production phase
The production phase of a mine is deemed to begin when saleable minerals are extracted (produced) from an ore body, regardless of the level of production. However, the production phase does not commence with the removal of de minimis saleable mineral material that occurs in conjunction with the removal of overburden or waste material for the purpose of obtaining access to an ore body.
Used in 1 subtopic:330-930
productive assets
Productive assets are assets held for or used in the production of goods or services by the entity. Productive assets include an investment in another entity if the investment is accounted for by the equity method but exclude an investment not accounted for by that method. Similar productive assets are productive assets that are of the same general type, that perform the same function, or that are employed in the same line of business.
Used in 1 subtopic:845-10
program services
The activities that result in goods and services being distributed to beneficiaries, customers, or members that fulfill the purposes or mission for which the not-for-profit entity (NFP) exists. Those services are the major purpose for and the major output of the NFP and often relate to several major programs.
Programmatic Investing
The activity of making loans or other investments that are directed at carrying out a not-for-profit entity's purpose for existence rather than investing in the general production of income or appreciation of an asset (for example, total return investing). An example of programmatic investing is a loan made to lower-income individuals to promote home ownership.
project
A time-sharing development; some projects may be completed in a single phase, such as a single, one-story building containing several time-sharing units. Other projects may be completed in several phases, for example: A hotel that is being converted to time-sharing units one floor at a time while the unconverted units continue to be rented A number of buildings, each containing several time-sharing units, being built on a piece of property over an extended period of time.
Project Costs
Costs clearly associated with the acquisition, development, and construction of a real estate project.
projected benefit obligation
The actuarial present value as of a date of all benefits attributed by the pension benefit formula to employee service rendered before that date. The projected benefit obligation is measured using assumptions as to future compensation levels if the pension benefit formula is based on those future compensation levels (pay-related, final-pay, final-average-pay, or career-average-pay plans).
Used in 1 subtopic:715-30
Promise to Give
A written or oral agreement to contribute cash or other assets to another entity. A promise carries rights and obligations—the recipient of a promise to give has a right to expect that the promised assets will be transferred in the future, and the maker has a social and moral obligation, and generally a legal obligation, to make the promised transfer. A promise to give may be either conditional or unconditional.
Used in 23 subtopics:205-954205-958220-954220-958230-10230-958+6 more
promised amenities
Amenities that a developer is obligated to construct under the terms of time-sharing contracts with purchasers. See also Amenities.
Used in 1 subtopic:310-978
promissory estoppel
"The principle that a promise made without consideration may nonetheless be enforced to prevent injustice if the promisor should have reasonably expected the promisee to rely on the promise and if the promisee did actually rely on the promise to his or her detriment." (See Black's Law Dictionary, seventh edition.)
Used in 1 subtopic:410-20
Properties
Mineral interests in properties (hereinafter referred to as properties), which include all of the following: Fee ownership or a lease Concession Other interest representing the legal right to produce or a revenue interest in the production of oil or gas subject to such terms as may be imposed by the conveyance of that interest. Properties also include: Royalty interests Production payments payable in oil or gas Other nonoperating interests in properties operated by others. Properties include those agreements with foreign governments or authorities under which an entity participates in the operation of the related properties or otherwise serves as producer of the underlying reserves (see paragraph 932-235-50-7); but properties do not include other supply agreements or contracts that represent the right to purchase (as opposed to extract) oil and gas. Properties are classified as proved properties or unproved properties.
property and casualty insurance entities
An entity that issues insurance contracts providing protection against either of the following: Damage to or loss of property caused by various perils, such as fire and theft Legal liability resulting from injuries to other persons or damage to their property. Property and liability insurance entities may be either stock or mutual entities.
Used in 1 subtopic:405-30
Property and liability insurance entities
An entity that issues insurance contracts providing protection against either of the following: Damage to, or loss of, property caused by various perils, such as fire and theft Legal liability resulting from injuries to other persons or damage to their property. Property and liability insurance entities also can issue accident and health insurance contracts. The term property and liability insurance entity is the current terminology used to describe a fire and casualty insurance entity. Property and liability insurance entities may be either stock or mutual entities.
Used in 1 subtopic:944-10
proprietary transactions
Transactions in financial instruments that broker-dealers execute for their own account.
Used in 1 subtopic:320-940
prospective reinsurance
Reinsurance in which an assuming entity agrees to reimburse a ceding entity for losses that may be incurred as a result of future insurable events covered under contracts subject to the reinsurance. A reinsurance contract may include both prospective and retroactive reinsurance provisions.
protection provisions
Provisions in some contracts to sell or transfer mortgage servicing rights that could affect the amount ultimately paid to the transferor. For example, the transferor may agree to adjust the sales price for loan prepayments, defaults, or foreclosures that occur within a specified period of time.
Used in 1 subtopic:860-50
Protective Rights (VIE definition)
Rights designed to protect the interests of the party holding those rights without giving that party a controlling financial interest in the entity to which they relate. For example, they include any of the following: Approval or veto rights granted to other parties that do not affect the activities that most significantly impact the entity's economic performance. Protective rights often apply to fundamental changes in the activities of an entity or apply only in exceptional circumstances. Examples include both of the following: A lender might have rights that protect the lender from the risk that the entity will change its activities to the detriment of the lender, such as selling important assets or undertaking activities that change the credit risk of the entity. Other interests might have the right to approve a capital expenditure greater than a particular amount or the right to approve the issuance of equity or debt instruments. The ability to remove the reporting entity that has a controlling financial interest in the entity in circumstances such as bankruptcy or on breach of contract by that reporting entity. Limitations on the operating activities of an entity. For example, a franchise agreement for which the entity is the franchisee might restrict certain activities of the entity but may not give the franchisor a controlling financial interest in the franchisee. Such rights may only protect the brand of the franchisor.
Used in 1 subtopic:810-10
Protective Rights (Voting Interest Entity definition)
Rights that are only protective in nature and that do not allow the limited partners or noncontrolling shareholders to participate in significant financial and operating decisions of the limited partnership or corporation that are made in the ordinary course of business.
proved
Proven reserves are reserves for which both of the following conditions are met: Quantity is computed from dimensions revealed in outcrops, trenches, workings, or drill holes; grade and/or quality are computed from the results of detailed sampling. The sites for inspection, sampling, and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth, and mineral content of reserves are well established.
Proved Developed Oil and Gas Reserves
Proved developed oil and gas reserves are proved reserves that can be expected to be recovered: Through existing wells with existing equipment and operating methods or in which the cost of the required equipment is relatively minor compared with the cost of a new well Through installed extraction equipment and infrastructure operational at the time of the reserves estimate if the extraction is by means not involving a well.
Used in 1 subtopic:235-932
Proved Oil and Gas Reserves
Proved oil and gas reserves are those quantities of oil and gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible from a given date forward, from known reservoirs, and under existing economic conditions, operating methods, and government regulation before the time at which contracts providing the right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of whether the estimate is a deterministic estimate or probabilistic estimate. The project to extract the hydrocarbons must have commenced, or the operator must be reasonably certain that it will commence the project, within a reasonable time.The area of the reservoir considered as proved includes all of the following: The area identified by drilling and limited by fluid contacts, if any Adjacent undrilled portions of the reservoir that can, with reasonable certainty, be judged to be continuous with it and to contain economically producible oil or gas on the basis of available geoscience and engineering data. In the absence of data on fluid contacts, proved quantities in a reservoir are limited by the lowest known hydrocarbons as seen in a well penetration unless geoscience, engineering, or performance data and reliable technology establish a lower contact with reasonable certainty.Where direct observation from well penetrations has defined a highest known oil elevation and the potential exists for an associated gas cap, proved oil reserves may be assigned in the structurally higher portions of the reservoir only if geoscience, engineering, or performance data and reliable technology establish the higher contact with reasonable certainty.Reserves that can be produced economically through application of improved recovery techniques (including, but not limited to, fluid injection) are included in the proved classification when both of the following occur: Successful testing by a pilot project in an area of the reservoir with properties no more favorable than in the reservoir as a whole, the operation of an installed program in the reservoir or an analogous reservoir, or other evidence using reliable technology establishes the reasonable certainty of the engineering analysis on which the project or program was based. The project has been approved for development by all necessary parties and entities, including governmental entities. Existing economic conditions include prices and costs at which economic producibility from a reservoir is to be determined. The price shall be the average price during the 12-month period before the ending date of the period covered by the report, determined as an unweighted arithmetic average of the first-day-of-the-month price for each month within such period, unless prices are defined by contractual arrangements, excluding escalations based upon future conditions.
Proved Undeveloped Oil and Gas Reserves
Proved undeveloped oil and gas reserves are proved reserves that are expected to be recovered from new wells on undrilled acreage, or from existing wells where a relatively major expenditure is required for recompletion. Reserves on undrilled acreage shall be limited to those directly offsetting development spacing areas that are reasonably certain of production when drilled, unless evidence using reliable technology exists that establishes reasonable certainty of economic producibility at greater distances. Undrilled locations can be classified as having undeveloped reserves only if a development plan has been adopted indicating that they are scheduled to be drilled within five years, unless the specific circumstances, justify a longer time. Under no circumstances shall estimates for proved undeveloped reserves be attributable to any acreage for which an application of fluid injection or other improved recovery technique is contemplated, unless such techniques have been proved effective by actual projects in the same reservoir or an analogous reservoir, or by other evidence using reliable technology establishing reasonable certainty.
Used in 1 subtopic:235-932
providers of prepaid health care services
Entities that provide or arrange for the delivery of health care services in accordance with the terms and provisions of a prepaid health care plan. Providers assume the financial risk of the cost of delivering health care services in excess of preestablished fixed premiums. However, some or all of the financial risk may be contractually transferred to other providers (affiliated entities) or by purchasing stop-loss insurance. Other providers of prepaid health care services may include comprehensive medical plans, physicians groups (for example, independent practice associations), and hospitals.
Used in 1 subtopic:310-954
Public Business Entity
A public business entity is a business entity meeting any one of the criteria below. Neither a not-for-profit entity nor an employee benefit plan is a business entity. It is required by the U.S. Securities and Exchange Commission (SEC) to file or furnish financial statements, or does file or furnish financial statements (including voluntary filers), with the SEC (including other entities whose financial statements or financial information are required to be or are included in a filing). It is required by the Securities Exchange Act of 1934 (the Act), as amended, or rules or regulations promulgated under the Act, to file or furnish financial statements with a regulatory agency other than the SEC. It is required to file or furnish financial statements with a foreign or domestic regulatory agency in preparation for the sale of or for purposes of issuing securities that are not subject to contractual restrictions on transfer. It has issued, or is a conduit bond obligor for, securities that are traded, listed, or quoted on an exchange or an over-the-counter market. It has one or more securities that are not subject to contractual restrictions on transfer, and it is required by law, contract, or regulation to prepare U.S. GAAP financial statements (including notes) and make them publicly available on a periodic basis (for example, interim or annual periods). An entity must meet both of these conditions to meet this criterion. An entity may meet the definition of a public business entity solely because its financial statements or financial information is included in another entity's filing with the SEC. In that case, the entity is only a public business entity for purposes of financial statements that are filed or furnished with the SEC.
Used in 42 subtopics:105-10205-20220-40230-10260-10270-10+6 more
public debt issuance
A public debt issuance occurs when a debtor issues a number of identical debt instruments to an underwriter that sells the debt instruments (in the form of securities) to various investors.
Used in 1 subtopic:470-50
Public Entity
A business entity or a not-for-profit entity that meets any of the following conditions: It has issued debt or equity securities or is a conduit bond obligor for conduit debt securities that are traded in a public market (a domestic or foreign stock exchange or an over-the-counter market, including local or regional markets). It is required to file financial statements with the Securities and Exchange Commission (SEC). It provides financial statements for the purpose of issuing any class of securities in a public market.
Used in 10 subtopics:280-10605-954718-10718-20718-30718-40+4 more
Publicly traded companies
A publicly traded company includes any company whose securities trade in a public market on either of the following: A stock exchange (domestic or foreign) In the over-the-counter market (including securities quoted only locally or regionally), or any company that is a conduit bond obligor for conduit debt securities that are traded in a public market (a domestic or foreign stock exchange or an over-the-counter market, including local or regional markets). Additionally, when a company is required to file or furnish financial statements with the SEC or makes a filing with a regulatory agency in preparation for sale of its securities in a public market it is considered a publicly traded company for this purpose. Conduit debt securities refers to certain limited-obligation revenue bonds, certificates of participation, or similar debt instruments issued by a state or local governmental entity for the express purpose of providing financing for a specific third party (the conduit bond obligor) that is not a part of the state or local government's financial reporting entity. Although conduit debt securities bear the name of the governmental entity that issues them, the governmental entity often has no obligation for such debt beyond the resources provided by a lease or loan agreement with the third party on whose behalf the securities are issued. Further, the conduit bond obligor is responsible for any future financial reporting requirements.
publicly traded entity
Any entity that does not meet the definition of a nonpublic entity.
Used in 1 subtopic:715-20
purchased call options
A contract that allows the reporting entity to buy a specified quantity of its own stock from the writer of the contract at a fixed price for a given period. See Call Option.
Used in 1 subtopic:260-10
Purchased Financial Assets with Credit Deterioration
Acquired individual financial assets (or acquired groups of financial assets with similar risk characteristics) that as of the date of acquisition have experienced a more-than-insignificant deterioration in credit quality since origination, as determined by an acquirer's assessment. See paragraph 326-20-55-5 for more information on the meaning of similar risk characteristics for assets measured on an amortized cost basis.
Used in 11 subtopics:230-10310-10310-20310-30310-40325-40+5 more
purchased seasoned loans
(P) December 16, 2026; (N) December 16, 2026 326-10-65-7 Paragraphs 326-20-30-16326-20-30-17326-20-30-18 define the term purchased seasoned loans.
purchaser's incremental borrowing rate
The rate that, at the inception of an unconditional purchase obligation, the purchaser would have incurred to borrow over a similar term the funds necessary to discharge the obligation.
Used in 1 subtopic:440-10
purchasing cooperative
Purchasing cooperatives purchase, manufacture, distribute, and provide feed, petroleum products, fertilizer, chemicals, farm supplies, and services of various kinds to their patrons. See Supply Cooperative.
Used in 1 subtopic:905-10
Purchasing power gain or loss
The net gain or loss determined by restating in units of constant purchasing power the opening and closing balances of, and transactions in, monetary assets and liabilities.
Used in 1 subtopic:255-10
Pushdown Accounting
Use of the acquirer's basis in the preparation of the acquiree's separate financial statements.
Used in 1 subtopic:805-50
put option
A contract that allows the holder to sell a specified quantity of stock to the writer of the contract at a fixed price during a given period.
Used in 1 subtopic:260-10
q
Qualified assets
See paragraph 946-10-S99-2, Regulation S-X Rule 6-02(d), for the definition of qualified assets.
Used in 1 subtopic:946-10
r
rabbi trust
Rabbi trusts are grantor trusts generally set up to fund compensation for a select group of management or highly paid executives. To qualify as a rabbi trust for income tax purposes, the terms of the trust agreement must explicitly state that the assets of the trust are available to satisfy the claims of general creditors in the event of bankruptcy of the employer.
Used in 1 subtopic:710-10
Ratchet death benefit
A death benefit equal to the highest account balance among prior specified anniversary dates adjusted for deposits less partial withdrawals since the specified anniversary date.
Used in 1 subtopic:944-20
Rate Implicit in the Lease
The rate of interest that, at a given date, causes the aggregate present value of (a) the lease paymentsand (b) the amount that a lessor expects to derive from the underlying asset following the end of the lease termto equal the sum of (1) the fair value of the underlying asset minus any related investment tax credit retained and expected to be realized by the lessor and (2) any deferred initial direct costs of the lessor. However, if the rate determined in accordance with the preceding sentence is less than zero, a rate implicit in the lease of zero shall be used.
Reacquisition Price of Debt
The amount paid on extinguishment, including a call premium and miscellaneous costs of reacquisition. If extinguishment is achieved by a direct exchange of new securities, the reacquisition price is the total present value of the new securities.
Used in 1 subtopic:470-50
Readily Convertible to Cash
Assets that are readily convertible to cash have both of the following: Interchangeable (fungible) units Quoted prices available in an active market that can rapidly absorb the quantity held by the entity without significantly affecting the price. (Based on paragraph 83(a) of FASB Concepts Statement No. 5, Recognition and Measurement in Financial Statements of Business Enterprises.)(P) December 16, 2024; (N) December 16, 2025105-10-65-9Assets that are readily convertible to cash have both of the following: Interchangeable (fungible) units Quoted prices available in an active market that can rapidly absorb the quantity held by the entity without significantly affecting the price.
Readily Determinable Fair Value
An equity security has a readily determinable fair value if it meets any of the following conditions: The fair value of an equity security is readily determinable if sales prices or bid-and-asked quotations are currently available on a securities exchange registered with the U.S. Securities and Exchange Commission (SEC) or in the over-the-counter market, provided that those prices or quotations for the over-the-counter market are publicly reported by the National Association of Securities Dealers Automated Quotations systems or by OTC Markets Group Inc. Restricted stock meets that definition if the restriction terminates within one year. The fair value of an equity security traded only in a foreign market is readily determinable if that foreign market is of a breadth and scope comparable to one of the U.S. markets referred to above. The fair value of an equity security that is an investment in a mutual fund or in a structure similar to a mutual fund (that is, a limited partnership or a venture capital entity) is readily determinable if the fair value per share (unit) is determined and published and is the basis for current transactions.
Used in 8 subtopics:320-10320-958321-10325-944325-958470-944+2 more
real estate investment trusts
Real estate investment trusts generally are formed as trusts, associations, or corporations. They employ equity capital, coupled with substantial amounts of debt financing, in making real estate loans and investments. Real estate investment trusts must distribute substantially all of their taxable income to their shareholders annually in order to retain their favorable tax status (that is, dividends paid are treated as deductions in arriving at taxable income).
Used in 6 subtopics:323-974720-974810-974835-974842-974974-10
real estate venture
Any of the following: a joint venture, a general partnership, a limited partnership, and an undivided interest.
Reasonably Possible
The chance of the future event or events occurring is more than remote but less than likely.
Recalcitrant Potentially Responsible Party
A party whose liability with respect to a Superfund site is substantiated by evidence, but that refuses to acknowledge potential involvement with respect to the site. Recalcitrant potentially responsible parties adopt a recalcitrant attitude toward the entire remediation effort even though evidence exists that points to their involvement at a site. Some may adopt this attitude out of ignorance of the law; others may do so in the hope that they will be considered a nuisance and therefore ignored. Typically, parties in this category must be sued in order to collect their allocable share of the remediation liability; however, it may be that it is not economical to bring such suits because the parties' assets are limited. This category of potentially responsible parties is also referred to as nonparticipating potentially responsible parties.
Used in 1 subtopic:410-30
recipient entity
A not-for-profit entity (NFP) or charitable trust that accepts assets from a donor or other resource provider and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a beneficiary that is specified by the donor or resource provider.
Reciprocal exchange
A group of persons, firms, or corporations commonly referred to as subscribers that exchange insurance contracts through an attorney-in-fact.
Used in 1 subtopic:944-10
reclassification adjustments
Adjustments made to avoid double counting in comprehensive income items that are displayed as part of net income for a period that also had been displayed as part of other comprehensive income in that period or earlier periods.
Used in 1 subtopic:220-10
Reclassification of Net Assets
Simultaneous increase of one class of net assets and decrease of another. A reclassification of net assets usually results from a donor-imposed restriction (donors include other types of contributors, including makers of certain grants) being satisfied or otherwise lapsing.
Used in 6 subtopics:205-958220-958360-958605-958805-958958-30
record masters
The master tape resulting from the performance of the artist. It is used to produce molds for commercial record production and other tapes for use in making cartridges, cassettes, DVDs, and reel tapes. The costs of producing a record master include the cost of the musical talent (musicians, vocal background, and arrangements); the cost of the technical talent for engineering, directing, and mixing; costs for the use of the equipment to record and produce the master; and studio facility charges. Under the standard type of artist contract, the record company bears a portion of the cost and recovers a portion of the cost from the artist out of designated royalties earned. However, either party may bear all or most of the cost.
Recorded Investment
The amount of the investment in a loan, which is not net of a valuation allowance, but which does reflect any direct write-down of the investment. However, if a loan is a hedged item in a fair value hedge, the amount of that loan's recorded investment should include the unamortized amount of the cumulative fair value hedge adjustments.
recourse
The right of a transferee of receivables to receive payment from the transferor of those receivables for any of the following: Failure of debtors to pay when due The effects of prepayments Adjustments resulting from defects in the eligibility of the transferred receivables.
recoverable amount
Current worth of the net amount of cash expected to be recoverable from the use or sale of an asset.
Used in 1 subtopic:255-10
Registration Payment Arrangement
An arrangement with both of the following characteristics: It specifies that the issuer will endeavor to do either of the following: File a registration statement for the resale of specified financial instruments and/or for the resale of equity shares that are issuable upon exercise or conversion of specified financial instruments and for that registration statement to be declared effective by the U.S. Securities and Exchange Commission (SEC) (or other applicable securities regulator if the registration statement will be filed in a foreign jurisdiction) within a specified grace period Maintain the effectiveness of the registration statement for a specified period of time (or in perpetuity). It requires the issuer to transfer consideration to the counterparty if the registration statement for the resale of the financial instrument or instruments subject to the arrangement is not declared effective or if effectiveness of the registration statement is not maintained. That consideration may be payable in a lump sum or it may be payable periodically, and the form of the consideration may vary. For example, the consideration may be in the form of cash, equity instruments, or adjustments to the terms of the financial instrument or instruments that are subject to the registration payment arrangement (such as an increased interest rate on a debt instrument).
Used in 7 subtopics:460-10480-10505-10815-10815-40825-10+1 more
Regular-way security trades
Regular-way security trades are contracts that provide for delivery of a security within the period of time (after the trade date) generally established by regulations or conventions in the marketplace or exchange in which the transaction is being executed.
Used in 1 subtopic:815-10
regular-way trades
Regular-way trades include both of the following: All transactions in exchange-traded financial instruments that are expected to settle within the standard settlement cycle of that exchange (for example, three days for U.S. exchanges) All transactions in cash-market-traded financial instruments that are expected to settle within the time frame prevalent or traditional for each specific instrument (for example, for U.S. government securities, one or two days).
regulatory assets and regulatory liabilities
Regulatory assets and regulatory liabilities are those assets and liabilities recognized pursuant to the provisions of paragraphs 980-340-25-1 and 980-405-25-1. These assets and liabilities are not recognized by entities in general.
Used in 1 subtopic:980-20
reimbursement plan
A plan that provides for a 12b-1 fee, payable by the fund, that may not exceed the lesser of an annual percentage of the fund's average net assets or actual costs incurred by the distributor net of contingent-deferred sales load received by the distributor.
Used in 1 subtopic:946-20
Reinsurance
A transaction in which a reinsurer (assuming entity), for a consideration (premium), assumes all or part of a risk undertaken originally by another insurer (ceding entity). For indemnity reinsurance, the legal rights of the insured are not affected by the reinsurance transaction and the insurance entity issuing the insurance contract remains liable to the insured for payment of policy benefits. Assumption or novation reinsurance contracts that are legal replacements of one insurer by another extinguish the ceding entity's liability to the policyholder.
Used in 21 subtopics:210-944220-40310-944340-30340-944405-30+6 more
Reinsurance Recoverable
All amounts recoverable from reinsurers for paid and unpaid claims and claim settlement expenses, including estimated amounts receivable for unsettled claims, claims incurred but not reported, or policy benefits.
Used in 8 subtopics:310-944326-20605-944805-944825-10825-944+2 more
reinsurer
The assuming entity in a reinsurance transaction.
Used in 7 subtopics:210-944310-944340-944605-944825-944944-20+1 more
relative fair value before construction
The fair value of each land parcel in a real estate project in relation to the fair value of the other parcels in the project, exclusive of value added by on-site development and construction activities.
Used in 1 subtopic:360-970
relative sales value method
The relative sales value method is similar to a gross profit method and is used to allocate inventory cost and determine cost of sales in conjunction with a sale. Under the relative sales value method, cost of sales is calculated as a percentage of net sales using a cost-of-sales percentage—the ratio of total estimated cost (including costs to complete, if any) to total estimated time-sharing revenue. Time-sharing revenue is calculated as total expected future revenue adjusted for total expected future bad-debt expense.
release
Related to Superfund: any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment. Includes the abandonment or discarding of barrels, containers, and other closed receptacles containing any hazardous substance, pollutant, or contaminant. The law provides for several exclusions. Release also means the substantial threat of release.
Used in 1 subtopic:410-30
Reload Feature and Reload Option
A reload feature provides for automatic grants of additional options whenever a grantee exercises previously granted options using the entity's shares, rather than cash, to satisfy the exercise price. At the time of exercise using shares, the grantee is automatically granted a new option, called a reload option, for the shares used to exercise the previous option.
Used in 1 subtopic:718-10
remainder interest
The right to receive all or a portion of the assets of a split-interest agreement remaining at the end of the agreement's term.
Remeasurement Event
A remeasurement (new basis) event is an event identified in other authoritative accounting literature, other than the measurement of an impairment under Topic 321 or credit loss under Topic 326, that requires a financial instrument to be remeasured to its fair value at the time of the event but does not require that financial instrument to be reported at fair value continually with the change in fair value recognized in earnings. Examples of remeasurement events are business combinations and significant modifications of debt as discussed in paragraph 470-50-40-6.
Used in 1 subtopic:815-15
remedial action
Related to Superfund: generally long-term actions taken to do any of the following: Investigate, alleviate, or eliminate the effects of a release of a hazardous substance into the environment Investigate, alleviate, or eliminate a threat of the release of an existing hazardous substance that could potentially harm human health or the environment Restore natural resources. Also refers to corrective action under the Resource Conservation and Recovery Act of 1976.
Used in 1 subtopic:410-30
remedial investigation-feasibility study
Extensive technical studies conducted by the government or by the potentially responsible parties to investigate the scope of site impacts and determine the remedial alternatives that, consistent with the National Contingency Plan, may be implemented at a Superfund site. Government-funded remedial investigation-feasibility studies do not recommend a specific alternative for implementation. Remedial investigation-feasibility studies conducted by potentially responsible parties usually do recommend and technically support a remedial alternative. A remedial investigation-feasibility study may include a variety of on- and off-site activities, such as monitoring, sampling, and analysis.
Used in 1 subtopic:410-30
Remote
The chance of the future event or events occurring is slight.
removal actions
Under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, generally short-term actions taken to respond promptly to an urgent need. The cleanup or removal of released hazardous substances from the environment; actions in response to the threat of release; actions that may be necessary to monitor, assess, and evaluate the release or threat; disposal of removed material; or other actions needed to prevent, minimize, or mitigate damage to public health or welfare or to the environment. Removal also includes, without being limited to, security fencing or other measures to limit access; provision of alternative water supplies; temporary evacuation and housing of threatened individuals not otherwise provided for; and any emergency assistance provided under the Disaster Relief Act.
Used in 1 subtopic:410-30
reorganization
A way to create a master limited partnership in which all of the assets of an entity are placed into a master limited partnership and that entity ceases to exist.
Used in 1 subtopic:805-50
reorganization items
Items of income, expense, gain, or loss that are realized or incurred by an entity because it is in reorganization.
Used in 1 subtopic:852-10
reorganization proceeding
A Chapter 11 case from the time at which the petition is filed until the plan is confirmed.
Used in 1 subtopic:852-10
Reorganization Value
The value attributed to the reconstituted entity, as well as the expected net realizable value of those assets that will be disposed of before reconstitution occurs. Therefore, this value is viewed as the value of the entity before considering liabilities and approximates the amount a willing buyer would pay for the assets of the entity immediately after the restructuring.
Used in 1 subtopic:852-10
replaced contract
A contract that currently is held by the contract holder, and is exchanged or modified in an internal replacement transaction.
Used in 1 subtopic:944-30
replacement award
An award of share-based compensation that is granted (or offered to grant) concurrently with the cancellation of another award.
Used in 1 subtopic:718-20
replacement contract
A new or modified contract in an internal replacement transaction.
Used in 1 subtopic:944-30
reporting currency
The currency in which a reporting entity prepares its financial statements.
reporting date
The date as of which information regarding the net assets available for benefits is presented.
reporting entity
An entity or group whose financial statements are being referred to. Those financial statements reflect any of the following: The financial statements of one or more foreign operations by combination, consolidation, or equity accounting Foreign currency transactions.
reporting unit
The level of reporting at which goodwill is tested for impairment. A reporting unit is an operating segment or one level below an operating segment (also known as a component).
Repurchase Agreement
An agreement under which the transferor (repo party) transfers a financial asset to a transferee (repo counterparty or reverse party) in exchange for cash and concurrently agrees to reacquire that financial asset at a future date for an amount equal to the cash exchanged plus or minus a stipulated interest factor. Instead of cash, other securities or letters of credit sometimes are exchanged. Some repurchase agreements call for repurchase of financial assets that need not be identical to the financial assets transferred.
Repurchase Agreement Accounted for as a Collateralized Borrowing
A repurchase agreement (repo) refers to a transaction in which a seller-borrower of securities sells those securities to a buyer-lender with an agreement to repurchase them at a stated price plus interest at a specified date or in specified circumstances. A repurchase agreement accounted for as a collateralized borrowing is a repo that does not qualify for sale accounting under Topic 860. The payable under a repurchase agreement accounted for as a collateralized borrowing refers to the amount of the seller-borrower's obligation recognized for the future repurchase of the securities from the buyer-lender. In certain industries, the terminology is reversed; that is, entities in those industries refer to this type of agreement as a reverse repo.
repurchase financing
A repurchase agreement that relates to a previously transferred financial asset between the same counterparties (or consolidated affiliates of either counterparty) that is entered into contemporaneously with, or in contemplation of, the initial transfer.
Used in 1 subtopic:860-10
Repurchase-to-Maturity Transaction
A repurchase agreement in which the settlement date of the agreement to repurchase a transferred financial asset is at the maturity date of that financial asset and the agreement would not require the transferor to reacquire the financial asset.
requisite service period
The period or periods during which an employee is required to provide service in exchange for an award under a share-based payment arrangement. The service that an employee is required to render during that period is referred to as the requisite service. The requisite service period for an award that has only a service condition is presumed to be the vesting period, unless there is clear evidence to the contrary. If an award requires future service for vesting, the entity cannot define a prior period as the requisite service period. Requisite service periods may be explicit, implicit, or derived, depending on the terms of the share-based payment award.
research and development
Research is planned search or critical investigation aimed at discovery of new knowledge with the hope that such knowledge will be useful in developing a new product or service (referred to as product) or a new process or technique (referred to as process) or in bringing about a significant improvement to an existing product or process. Development is the translation of research findings or other knowledge into a plan or design for a new product or process or for a significant improvement to an existing product or process whether intended for sale or use. It includes the conceptual formulation, design, and testing of product alternatives, construction of prototypes, and operation of pilot plants.
Reseller
Any entity that purchases another vendor's products for resale, regardless of whether that entity is a distributor or wholesaler, a retailer, or other type of reseller.
reservoir
A reservoir is a porous and permeable underground formation containing a natural accumulation of producible oil or gas that is confined by impermeable rock or water barriers and is individual and separate from other reservoirs.
Used in 1 subtopic:360-932
reset date
The date at which the existing contractually declared investment return expires.
Used in 1 subtopic:944-40
residual value
The estimated fair value of an intangible asset at the end of its useful life to an entity, less any disposal costs.
Used in 1 subtopic:350-30
Residual Value Guarantee
A guarantee made to a lessor that the value of an underlying asset returned to the lessor at the end of a lease will be at least a specified amount.
restate-translate
An approach to converting current cost-nominal functional currency data of a foreign operation into units of constant purchasing power expressed in dollars. Using this approach, the current cost-nominal functional currency data are restated into units of constant purchasing power using a general price index for the foreign currency. After restatement into units of constant functional currency purchasing power, the current cost data are translated into dollars. This approach often necessitates a parity adjustment.
Used in 1 subtopic:255-10
Restatement
The process of revising previously issued financial statements to reflect the correction of an error in those financial statements.
restricted net assets
See paragraph 235-10-S99-1, Regulation S-X Rule 4-08(e)(3), for definition of restricted net assets for purposes of the restricted net asset test.
Used in 1 subtopic:205-10
restriction
A contractual or governmental provision that prohibits sale (or substantive sale by using derivatives or other means to effectively terminate the risk of future changes in the share price) of an equity instrument for a specified period of time.
restructuring
A program that is planned and controlled by management, and materially changes either the scope of a business undertaken by an entity, or the manner in which that business is conducted, as defined by the International Accounting Standard No. 37 in 2002.
Used in 1 subtopic:420-10
retains
Amounts determined on a per-unit basis or as a percentage of patronage earnings that are withheld by cooperatives from distributions and allocated to patrons' capital accounts.
Retired life fund
That portion of the funds under an immediate participation guarantee contract that is designated as supporting benefit payments to current retirees.
Used in 1 subtopic:960-10
retirees
Collectively, that group of plan participants that includes retired employees, their beneficiaries, and covered dependents.
Used in 1 subtopic:715-60
Retirement
The other-than-temporary removal of a long-lived asset from service. That term encompasses sale, abandonment, recycling, or disposal in some other manner. However, it does not encompass the temporary idling of a long-lived asset. After an entity retires an asset, that asset is no longer under the control of that entity, no longer in existence, or no longer capable of being used in the manner for which the asset was originally acquired, constructed, or developed.
retroactive reinsurance
Reinsurance in which an assuming entity agrees to reimburse a ceding entity for liabilities incurred as a result of past insurable events covered under contracts subject to the reinsurance. A reinsurance contract may include both prospective and retroactive reinsurance provisions.
retrocession
The circumstance in which a reinsurer, in turn, enters into reinsurance contracts with other reinsurers.
Used in 1 subtopic:944-20
retrospective application
The application of a different accounting principle to one or more previously issued financial statements, or to the statement of financial position at the beginning of the current period, as if that principle had always been used, or a change to financial statements of prior accounting periods to present the financial statements of a new reporting entity as if it had existed in those prior years.
Used in 1 subtopic:250-10
retrospective interest method
A method of interest income recognition under which income for the current period is measured as the difference between the amortized cost at the end of the period and the amortized cost at the beginning of the period, plus any cash received during the period.
Used in 1 subtopic:320-10
return of capital
Distributions by investment companies in excess of tax-basis earnings and profits.
reunderwriting
The reexamination of the insurance risk of the entire contract for purposes of acceptance or rejection or for rating the risk for pricing purposes.
Used in 1 subtopic:944-30
Revenue
Inflows or other enhancements of assets of an entity or settlements of its liabilities (or a combination of both) from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing major or central operations.
Used in 37 subtopics:235-10235-942270-10275-10330-978340-40+6 more
reverse acquisitions
An acquisition in which the entity that issues securities (the legal acquirer) is identified as the acquiree for accounting purposes based on the guidance in paragraphs 805-10-55-11805-10-55-12805-10-55-13805-10-55-14805-10-55-15. The entity whose equity interests are acquired (the legal acquiree) must be the acquirer for accounting purposes for the transaction to be considered a reverse acquisition.
Reverse Repurchase Agreement Accounted for as a Collateralized Borrowing
A reverse repurchase agreement accounted for as a collateralized borrowing (also known as a reverse repo) refers to a transaction that is accounted for as a collateralized lending in which a buyer-lender buys securities with an agreement to resell them to the seller-borrower at a stated price plus interest at a specified date or in specified circumstances. The receivable under a reverse repurchase agreement accounted for as a collateralized borrowing refers to the amount due from the seller-borrower for the repurchase of the securities from the buyer-lender. In certain industries, the terminology is reversed; that is, entities in those industries refer to this type of agreement as a repo.
reverse spinoff
A spinoff of a subsidiary to an entity's shareholders in which the legal form of the transaction does not match its substance such that the new legal spun-off entity (the spinnee) will be the continuing entity.
Used in 1 subtopic:505-60
reverse treasury stock method
A method of recognizing the dilutive effect on EPS of satisfying a put obligation. It assumes that the proceeds used to buy back common stock (pursuant to the terms of a put option) will be raised from issuing shares at the average market price during the period. See Put Option.
Used in 1 subtopic:260-10
Revised Financial Statements
Financial statements revised only for either of the following conditions: Correction of an error Retrospective application of U.S. GAAP.
Used in 1 subtopic:855-10
revolving-period securitizations
Securitizations in which receivables are transferred at the inception and also periodically (daily or monthly) thereafter for a defined period (commonly three to eight years), referred to as the revolving period. During the revolving period, the special-purpose entity uses most of the cash collections to purchase additional receivables from the transferor on prearranged terms.
right of setoff
A right of setoff is a debtor's legal right, by contract or otherwise, to discharge all or a portion of the debt owed to another party by applying against the debt an amount that the other party owes to the debtor.
Used in 1 subtopic:210-20
Right-of-Use Asset
An asset that represents a lessee's right to use an underlying asset for the lease term.
rights issue
An offer to existing shareholders to purchase additional shares of common stock in accordance with an agreement for a specified amount (which is generally substantially less than the fair value of the shares) for a given period.
Used in 1 subtopic:260-10
Risk of Adverse Deviation
A concept (also referred to as risk load) used by insurance entities that allows for possible unfavorable deviations from assumptions.
Used in 1 subtopic:944-40
Roll-up death benefit
A death benefit equal to the total of deposits made to the contract less an adjustment for partial withdrawals, accumulated at a specified interest rate.
Used in 1 subtopic:944-20
rollout
A way to create a master limited partnership in which certain assets of a sponsor are placed into a limited partnership and units are distributed to the shareholders.
Used in 1 subtopic:805-50
rollup
A way to create a master limited partnership in which two or more legally separate limited partnerships are combined into one master limited partnership.
rotable parts
Rotable parts are normally repaired and reused, as opposed to those parts that are consumed in the operations (expendable parts).
royalties
Amounts paid to record producers, songwriters, or other artists for their participation in making records and to music publishers for their copyright interest in music. Amounts for artists are determined by the terms of personal service contracts negotiated between the artists and record entities and usually are determined based upon a percentage of sales activity and license fee income, adjusted for estimated sales returns. Royalties for publishing are based on the copyright or other applicable laws, but the requirements of the law may be modified by licenses issued by the publishers.
s
Sabbatical leave
A benefit in the form of a compensated absence whereby the employee is entitled to paid time off after working for an entity for a specified period of time. During the sabbatical, the individual continues to be a compensated employee and is not required to perform any duties for the entity.
Used in 1 subtopic:710-10
Sale-Leaseback Accounting
Glossary term superseded by Accounting Standards Update No. 2016-02.
Used in 1 subtopic:360-20
Saleable Hydrocarbons
Hydrocarbons that are saleable in the state in which the hydrocarbons are delivered.
Used in 1 subtopic:932-10
Sales Inducements
Contractually obligated inducements that are identified explicitly in a contract and are in excess of current market conditions. A sales inducement to a contract holder enhances the investment yield to the contract holder. The three main types of sales inducements are an immediate bonus, a persistency bonus, and an enhanced-crediting-rate bonus.
Sales-Type Lease
From the perspective of a lessor, a lease that meets one or more of the criteria in paragraph 842-10-25-2 and is not an operating lease in accordance with paragraph 842-10-25-3A.
Used in 16 subtopics:220-40255-10310-10340-970450-30805-10+6 more
salvage
The amount received by an insurer from the sale of property (usually damaged) on which the insurer has paid a total claim to the insured and has obtained title to the property.
Used in 1 subtopic:944-40
Sampler Program
A marketing program under which a time-share developer offers a customer, who has previously toured one of the developer's projects, a stay at one of the projects at a reduced rate. In exchange, the customer agrees to take another, subsequent tour of the project selected under the sampler program during the customer's stay at that project. If the subsequent tour results in a sale, the developer may allow the customer to apply some or all of the amount paid for the sampler toward the purchase of a time-share, as a part of the down payment. Also referred to as Exit Program.
Used in 1 subtopic:330-978
secured claim
A liability that is secured by collateral. A fully secured claim is one in which the value of the collateral is greater than the amount of the claim.
Used in 1 subtopic:852-10
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
The fixed rate on a U.S. dollar, constant-notional interest rate swap that has its variable-rate leg referenced to the Secured Overnight Financing Rate (SOFR) (an overnight rate) with no additional spread over SOFR on that variable-rate leg. That fixed rate is the derived rate that would result in the swap having a zero fair value at inception because the present value of fixed cash flows, based on that rate, equates to the present value of the variable cash flows.
Used in 1 subtopic:815-20
Securities and Exchange Commission (SEC) Filer
An entity that is required to file or furnish its financial statements with either of the following: The Securities and Exchange Commission (SEC) With respect to an entity subject to Section 12(i) of the Securities Exchange Act of 1934, as amended, the appropriate agency under that Section. Financial statements for other entities that are not otherwise SEC filers whose financial statements are included in a submission by another SEC filer are not included within this definition.
Securities and Exchange Commission Registrant
An entity (or an entity that is controlled by an entity) that meets any of the following criteria: It has issued or will issue debt or equity securities that are traded in a public market (a domestic or foreign stock exchange or an over-the-counter market, including local or regional markets). It is required to file financial statements with the Securities and Exchange Commission (SEC). It provides financial statements for the purpose of issuing any class of securities in a public market.
securities custodian
The securities custodian for a securities transfer system may be the bank or financial institution that executes securities transfers over the securities transfer system, and book entry securities exist only in electronic form on the records of the transfer system operator for each entity that has a security account with the transfer system operator.
Used in 1 subtopic:210-20
Securities Industry and Financial Markets Association (SIFMA) Municipal Swap Rate
The fixed rate on a U.S. dollar, constant-notional interest rate swap that has its variable-rate leg referenced to the Securities Industry and Financial Markets Association (SIFMA) Municipal Swap Index with no additional spread over the SIFMA Municipal Swap Index on that variable-rate leg. That fixed rate is the derived rate that would result in the swap having a zero fair value at inception because the present value of fixed cash flows, based on that rate, equates to the present value of the variable cash flows.
Used in 1 subtopic:815-20
Securitizations
The process by which financial assets are transformed into securities.
Security
A share, participation, or other interest in property or in an entity of the issuer or an obligation of the issuer that has all of the following characteristics: It is either represented by an instrument issued in bearer or registered form or, if not represented by an instrument, is registered in books maintained to record transfers by or on behalf of the issuer. It is of a type commonly dealt in on securities exchanges or markets or, when represented by an instrument, is commonly recognized in any area in which it is issued or dealt in as a medium for investment. It either is one of a class or series or by its terms is divisible into a class or series of shares, participations, interests, or obligations.
Used in 13 subtopics:220-40260-10320-10320-958321-10470-10+6 more
security interest
A form of interest in property that provides that upon default of the obligation for which the security interest is given, the property may be sold to satisfy that obligation.
Used in 1 subtopic:860-30
seed money
An investment of non-contract-holder funds by an insurer in a separate account when it is established, to support the initial or ongoing operations of the separate account.
Used in 1 subtopic:944-80
seller
A transferor that relinquishes control over financial assets by transferring them to a transferee in exchange for consideration.
seller subsidies
As related to time-sharing transactions, an amount that a seller pays to an owners association to cover net losses that may be incurred by the association.
Used in 1 subtopic:720-978
Selling Profit or Selling Loss
At the commencement date, selling profit or selling loss equals: The fair value of the underlying asset or the sum of (1) the lease receivable and (2) any lease payments prepaid by the lessee, if lower; minus The carrying amount of the underlying asset net of any unguaranteed residual asset; minus Any deferred initial direct costs of the lessor.
separate account
A special account established by an insurance entity solely for the purpose of investing the assets of one or more plans. Funds in a separate account are not commingled with other assets of the insurance entity for investment purposes.
separate account arrangement
An arrangement under which all or a portion of a contract holder's funds is allocated to a specific separate account maintained by the insurance entity.
Used in 1 subtopic:944-80
Separately priced contracts
An agreement under which the customer has the option to purchase an extended warranty or a product maintenance contract for an expressly stated amount separate from the price of the product.
Used in 1 subtopic:605-20
Service
Employment taken into consideration under a pension plan. Years of employment before the inception of a plan constitute an employee's past service; years thereafter are classified in relation to the particular actuarial valuation being made or discussed. Years of employment (including past service) before the date of a particular valuation constitute prior service; years of employment following the date of the valuation constitute future service; a year of employment adjacent to the date of valuation, or in which such date falls, constitutes current service.
Service Condition
A condition affecting the vesting, exercisability, exercise price, or other pertinent factors used in determining the fair value of an award that depends solely on an employee rendering service to the employer for the requisite service period or a nonemployee delivering goods or rendering services to the grantor over a vesting period. A condition that results in the acceleration of vesting in the event of a grantee's death, disability, or termination without cause is a service condition.
service cooperatives
A cooperative that provides to its patrons such services as trucking, storage, accounting, and data processing.
Used in 1 subtopic:905-10
service corporations
A real estate investment trust may establish a service corporation to perform services for the real estate investment trust or for third parties. Service corporations may provide property management and leasing services, as well as services to acquire, develop, construct, finance, or sell real estate projects.
Service Cost (Component of Net Periodic Pension Cost)
A component of net periodic pension cost recognized in a period determined as the actuarial present value of benefits attributed by the pension benefit formula to services rendered by employees during that period. The service cost component is a portion of the projected benefit obligation and is unaffected by the funded status of the plan.
Service Cost (Component of Net Periodic Postretirement Benefit Cost)
The actuarial present value of benefits attributed to services rendered by employees during the period (the portion of the expected postretirement benefit obligation attributed to service in the period). The service cost component is the same for an unfunded plan, a plan with minimal funding, and a well-funded plan.
Service Inception Date
The date at which the employee's requisite service period or the nonemployee's vesting period begins. The service inception date usually is the grant date, but the service inception date may differ from the grant date (see Example 6 [see paragraph 718-10-55-107] for an illustration of the application of this term to an employee award).
service wells
A service well is a well drilled or completed for the purpose of supporting production in an existing field. Wells in this class are drilled for the following specific purposes: gas injection (natural gas, propane, butane, or flue gas), water injection, steam injection, air injection, salt-water disposal, water supply for injection, observation, or injection for in-situ combustion.
Used in 1 subtopic:360-932
Servicing Assets
A contract to service financial assets under which the benefits of servicing are expected to more than adequately compensate the servicer for performing the servicing. A servicing contract is either: Undertaken in conjunction with selling or securitizing the financial assets being serviced Purchased or assumed separately.
servicing liabilities
A contract to service financial assets under which the estimated future revenues from contractually specified servicing fees, late charges, and other ancillary revenues (benefits of servicing) are not expected to adequately compensate the servicer for performing the servicing.
Used in 1 subtopic:860-50
set for production
This means that management, with the relevant authority, implicitly or explicitly authorizes and commits to funding the production of a film; active preproduction has begun; and the start of principal photography is expected to begin within six months.
Used in 1 subtopic:926-20
Set-off Right
A common law right of a party that is both a debtor and a creditor to the same counterparty to reduce its obligation to that counterparty if that counterparty fails to pay its obligation.
Used in 1 subtopic:860-10
settlement
A transaction that is an irrevocable action, relieves the employer (or the plan) of primary responsibility for a pension or postretirement benefit obligation, and eliminates significant risks related to the obligation and the assets used to effect the settlement.
settlement
An action or event that irrevocably extinguishes the issuing entity's obligation under a share-based payment award. Transactions and events that constitute settlements include the following: Exercise of a share option or lapse of an option at the end of its contractual term Vesting of shares Forfeiture of shares or share options due to failure to satisfy a vesting condition An entity's repurchase of instruments in exchange for assets or for fully vested and transferable equity instruments. The vesting of a share option is not a settlement because the entity remains obligated to issue shares upon exercise of the option.
settlement period
The estimated period over which a ceding entity expects to recover substantially all amounts due from the reinsurer under the terms of the reinsurance contract.
Used in 1 subtopic:605-944
severe impact
(Used in reference to current vulnerability due to certain concentrations.) A significant financially disruptive effect on the normal functioning of an entity. Severe impact is a higher threshold than material. Matters that are important enough to influence a user's decisions are deemed to be material, yet they may not be so significant as to disrupt the normal functioning of the entity. Some events are material to an investor because they might affect the price of an entity's capital stock or its debt securities, but they would not necessarily have a severe impact on (disrupt) the entity itself. The concept of severe impact, however, includes matters that are less than catastrophic. Matters that are catastrophic include, for example, those that would result in bankruptcy.
Used in 1 subtopic:275-10
short-term inducement
An offer by the entity that would result in modification of an award to which an award holder may subscribe for a limited period of time.
Used in 1 subtopic:718-20
Short-Term Lease
A lease that, at the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise.
Short-term obligations
Short-term obligations are those that are scheduled to mature within one year after the date of an entity's balance sheet or, for those entities that use the operating cycle concept of working capital described in paragraphs 210-10-45-3 and 210-10-45-7, within an entity's operating cycle that is longer than one year.
Used in 1 subtopic:210-10
significant
Changes that are additive to a film; that is, the creation of new or additional content after the film is initially available to the customer. For example, reshooting a scene or creating additional special effects are significant changes. (P) December 16, 2019; (N) December 16, 2020926-20-65-2Glossary term superseded by Accounting Standards Update No. 2019-02.
Used in 1 subtopic:405-926
Significant Activities
An entity is regarded as having significant oil- and gas-producing activities if it satisfies any of the following criteria. The criteria shall be applied separately for each year for which a complete set of annual financial statements is presented. Revenues from oil- and gas-producing activities, as defined in paragraph 932-235-50-24 (including both sales to unaffiliated customers and sales or transfers to the entity's other operations), are 10 percent or more of the combined revenues (sales to unaffiliated customers and sales or transfers to the entity's other operations) of all of the entity's industry segments. An industry segment is a component of an entity engaged in providing a product or service or a group of related products or services primarily to external customers (that is, customers outside the entity) for a profit. Results of operations for oil- and gas-producing activities, including equity earnings or losses from oil- and gas- producing activities of equity method investees and excluding the effect of income taxes, are 10 percent or more of the greater of the following: The combined operating profit (including equity earnings) of all industry segments that did not incur an operating loss The combined operating loss (including equity losses) of all industry segments that did incur an operating loss. The identifiable assets of oil- and gas-producing activities (tangible and intangible entity assets that are used by oil- and gas-producing activities, including an allocated portion of assets used jointly with other operations and the investment balance in the oil- and gas-producing activities of equity method investees) are 10 percent or more of the assets of the entity, excluding assets used exclusively for general corporate purposes.
Used in 1 subtopic:235-932
Significant Changes to a Film
Changes that are additive to a film; that is, the creation of new or additional content after the film is initially available to the customer. For example, reshooting a scene or creating additional special effects are significant changes.
significant geographic area
See paragraph 942-235-S99-1, Regulation S-X Rule 9-05(c)(3), for the definition of significant geographic area for purposes of Regulation S-X Rule 9-05.
Used in 1 subtopic:235-942
significant influence
Paragraphs 323-10-15-6323-10-15-7323-10-15-8323-10-15-9323-10-15-10323-10-15-11 define significant influence.
simultaneous-equations
A method to calculate distributions to shareholders from net investment income that seeks to ensure, by using simultaneous equations, that the distribution rates will differ among the classes by the anticipated differential in expense ratios.
Used in 1 subtopic:505-946
Single-Employer Plan
A pension plan or other postretirement benefit plan that is maintained by one employer. The term also may be used to describe a plan that is maintained by related parties such as a parent and its subsidiaries.
Slot Machine
A type of mechanical or electrical apparatus used in connection with gaming.
soft-dollar arrangements
An arrangement in which a broker-dealer provides research to a customer in return for trade order flow (a certain volume of trades) from that customer.
Used in 1 subtopic:940-20
spare parts
Parts, appurtenances, and accessories of aircraft (other than aircraft engines and propellers), of aircraft engines (other than propellers), of propellers, or of appliances that are maintained for installation or use in an aircraft, aircraft engine, propeller, or appliance but that are not yet installed or attached.
special termination benefits
Benefits that are offered for a short period of time in exchange for employees' voluntary termination of service.
Used in 1 subtopic:712-10
special-purpose entity
An entity, typically a corporation or a trust, to which a seller transfers time-sharing real estate in exchange for the entity's stock, membership interests, or beneficial interests.
specialized skills
Services that require expertise that is not possessed by most members of the general public or that require an individual to be licensed to practice the profession or craft.
Used in 1 subtopic:605-958
Spending Rate
The portion of total return on investments used for fiscal needs of the current period, usually used as a budgetary method of reporting returns of investments. It is usually measured in terms of an amount or a specified percentage of a moving average market value. Typically, the selection of a spending rate emphasizes the use of prudence and a systematic formula to determine the portion of cumulative investment return that can be used to support fiscal needs of the current period and the protection of endowment gifts from a loss of purchasing power as a consideration in determining the formula to be used.
spinoff
The transfer of assets that constitute a business by an entity (the spinnor) into a new legal spun-off entity (the spinnee), followed by a distribution of the shares of the spinnee to its shareholders, without the surrender by the shareholders of any stock of the spinnor.
Used in 1 subtopic:505-60
Split-Interest Agreement
An agreement in which a donor enters into a trust or other arrangement under which a not-for-profit entity (NFP) receives benefits that are shared with other beneficiaries. A typical split-interest agreement has the following two components: A lead interest A remainder interest.
split-off
A transaction in which a parent entity exchanges its stock in a subsidiary for parent entity stock held by its shareholders.
Used in 1 subtopic:845-10
Sponsor
In the case of a pension plan established or maintained by a single employer, the employer; in the case of a plan established or maintained by an employee entity, the employee entity; in the case of a plan established or maintained jointly by two or more employers or by one or more employers and one or more employee entities, the association, committee, joint board of trustees, or other group of representatives of the parties that have established or that maintain the pension plan.
Used in 8 subtopics:205-960205-962325-962730-20810-30960-20+2 more
Spot Rate
The exchange rate for immediate delivery of currencies exchanged.
Used in 7 subtopics:815-10815-20815-25815-30815-35830-946+1 more
springing lock-box arrangement
Some borrowings outstanding under a revolving credit agreement include both a subjective acceleration clause and a requirement to maintain a springing lock-box arrangement, whereby remittances from the borrower's customers are forwarded to the debtor's general bank account and do not reduce the debt outstanding until and unless the lender exercises the subjective acceleration clause.
Used in 1 subtopic:470-10
Standalone Price
The price at which a customer would purchase a component of a contract separately.
Standalone Selling Price
The price at which an entity would sell a promised good or service separately to a customer.
Standard Antidilution Provisions
Standard antidilution provisions are those that result in adjustments to the conversion ratio in the event of an equity restructuring transaction that are designed to maintain the value of the conversion option.
Standard Representations and Warranties
Representations and warranties that assert the financial asset being transferred is what it is purported to be at the transfer date.
Used in 1 subtopic:860-10
Standby letters of credit
A letter of credit (or similar arrangement however named or designated) that represents an obligation to the beneficiary on the part of the issuer for any of the following: To repay money borrowed by or advanced to or for the account of the account party To make payment on account of any evidence of indebtedness undertaken by the account party To make payment on account of any default by the account party in the performance of an obligation. A standby letter of credit would not include the following: Commercial letters of credit and similar instruments where the issuing bank expects the beneficiary to draw upon the issuer and which do not guarantee payment of a money obligation A guarantee or similar obligation issued by a foreign branch in accordance with and subject to the limitations of Regulation M of the Federal Reserve Board.
standstill agreement
An agreement signed by the investee and investor under which the investor agrees to limit its shareholding in the investee.
Used in 1 subtopic:323-10
start-up activities
Defined broadly as those one-time activities related to any of the following: Opening a new facility Introducing a new product or service Conducting business in a new territory Conducting business with an entirely new class of customers (for example, a manufacturer who does all of its business with retailers attempts to sell merchandise directly to the public) or beneficiary Initiating a new process in an existing facility Commencing some new operation.
Used in 1 subtopic:720-15
Statement of Changes in Net Assets in Liquidation
A statement that presents the changes during the period in net assets available for distribution to investors and other claimants during liquidation.
Used in 1 subtopic:205-30
Statement of Net Assets in Liquidation
A statement that presents a liquidating entity's net assets available for distribution to investors and other claimants as of the end of the reporting period.
Used in 1 subtopic:205-30
statutory accounting practices
Accounting principles required by statute, regulation, or rule, or permitted by specific approval, that an insurance entity is required to follow when submitting its financial statements to state insurance departments.
Used in 1 subtopic:505-944
step bonds
Bonds that involve a combination of deferred-interest payment dates and increasing interest payment amounts over the bond lives and, thus, bear some similarity to zero-coupon bonds and to traditional debentures.
Used in 1 subtopic:320-946
Stipulation
A statement by a donor that creates a condition or restriction on the use of transferred resources.
stock appreciation right
A stock appreciation right is an award entitling employees to receive cash, stock, or a combination of cash and stock in an amount equivalent to any excess of the fair value of a stated number of shares of the employer's stock over a stated price.
Used in 1 subtopic:815-20
stock dividend
An issuance by a corporation of its own common shares to its common shareholders without consideration and under conditions indicating that such action is prompted mainly by a desire to give the recipient shareholders some ostensibly separate evidence of a part of their respective interests in accumulated corporate earnings without distribution of cash or other property that the board of directors deems necessary or desirable to retain in the business. A stock dividend takes nothing from the property of the corporation and adds nothing to the interests of the stockholders; that is, the corporation's property is not diminished and the interests of the stockholders are not increased. The proportional interest of each shareholder remains the same.
stock split
An issuance by a corporation of its own common shares to its common shareholders without consideration and under conditions indicating that such action is prompted mainly by a desire to increase the number of outstanding shares for the purpose of effecting a reduction in their unit market price and, thereby, of obtaining wider distribution and improved marketability of the shares. Sometimes called a stock split-up.
Used in 1 subtopic:505-20
stop-loss arrangements
In a stop-loss insurance arrangement, a plan's obligation for any plan participant's claims may be limited to a fixed dollar amount, or the plan's total obligation may be limited to a maximum percentage (for example, 125 percent) of a preset expected claims level. These arrangements are commonly used with administrative service arrangements. The insurance entity assumes the benefit obligation in excess of the limit. Stop-loss insurance arrangements may have characteristics of both self-funded and fully insured arrangements.
stop-loss insurance
A contract in which an entity agrees to indemnify providers for certain health care costs incurred by members.
Stratigraphic Test Well
A stratigraphic test is a drilling effort, geologically directed, to obtain information pertaining to a specific geologic condition. Such wells customarily are drilled without the intention of being completed for hydrocarbon production. This classification also includes tests identified as core tests and all types of expendable holes related to hydrocarbon exploration. Stratigraphic tests are classified as exploratory-type if not drilled in a proved area or development-type if drilled in a proved area.
strict liability
Liability imposed without regard to the liable party's fault.
Used in 1 subtopic:410-30
stripping costs
Stripping costs are costs incurred for the removal of overburden or waste materials for the purpose of obtaining access to an ore body that will be commercially produced.
Used in 1 subtopic:330-930
structured note
A debt instrument whose cash flows are linked to the movement in one or more indexes, interest rates, foreign exchange rates, commodities prices, prepayment rates, or other market variables. Structured notes are issued by U.S. government-sponsored enterprises, multilateral development banks, municipalities, and private entities. The notes typically contain embedded (but not separable or detachable) forward components or option components such as caps, calls, and floors. Contractual cash flows for principal, interest, or both can vary in amount and timing throughout the life of the note based on nontraditional indexes or nontraditional uses of traditional interest rates or indexes.
Used in 1 subtopic:320-10
stub period
Interest rate swaps with variable rates based on the London Interbank Offered Rate (LIBOR) typically reset at three-month or six-month intervals. Often, swaps may trade on interim dates that do not correspond to a swap reset date. Calendar dates that are swap reset and payment dates are set by market convention. A swap that resets quarterly may have a first payment period that is shorter than a full quarter, such as 30 days versus 90 days. Because the first payment period is not equal to a full quarter, it is referred to as a stub period. That stub period is the period that begins on the date coupon payments begin to accrue and ends on the first payment date.
Used in 1 subtopic:815-20
stub rate
The stub rate is the variable rate that corresponds to the length of a stub period.
Used in 1 subtopic:815-20
subcontractor claims
Those obligations of a contractor to a subcontractor that arise from the subcontractor's costs incurred through transactions that were related to a contract terminated but did not result in the transfer of billable materials or services to the contractor before termination.
subjective acceleration clause
A subjective acceleration clause is a provision in a debt agreement that states that the creditor may accelerate the scheduled maturities of the obligation under conditions that are not objectively determinable (for example, if the debtor fails to maintain satisfactory operations or if a material adverse change occurs).
Used in 1 subtopic:470-10
Sublease
A transaction in which an underlying asset is re-leased by the lessee (or intermediate lessor) to a third party (the sublessee) and the original (or head) lease between the lessor and the lessee remains in effect.
subordinated financial support
Variable interests that will absorb some or all of a variable interest entity's (VIE's) expected losses.
Used in 1 subtopic:810-10
subrogation
The right of an insurer to pursue any course of recovery of damages, in its name or in the name of the policyholder, against a third party who is liable for costs relating to an insured event that have been paid by the insurer.
Used in 1 subtopic:944-40
subscription-form demutualization
A situation in which eligible policyholders receive only the right to purchase stock in the insurance entity or its parent at terms essentially equivalent to the terms offered to independent third parties.
Used in 1 subtopic:805-944
subsequent events
Events or transactions that occur after the balance sheet date but before financial statements are issued or are available to be issued. There are two types of subsequent events: The first type consists of events or transactions that provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements (that is, recognized subsequent events). The second type consists of events that provide evidence about conditions that did not exist at the date of the balance sheet but arose subsequent to that date (that is, nonrecognized subsequent events).
Used in 1 subtopic:855-10
subsidiary
An entity, including an unincorporated entity such as a partnership or trust, in which another entity, known as its parent, holds a controlling financial interest. (Also, a variable interest entity that is consolidated by a primary beneficiary.)
Used in 11 subtopics:220-10220-40235-932260-10323-10405-942+5 more
Substantial Doubt about an Entity's Ability to Continue as a Going Concern
Substantial doubt about an entity's ability to continue as a going concern exists when conditions and events, considered in the aggregate, indicate that it is probable that the entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable). The term probable is used consistently with its use in Topic 450 on contingencies.
Used in 1 subtopic:205-40
Substantive conversion feature
A conversion feature that is at least reasonably possible of being exercisable in the future absent the issuer's exercise of a call option.
Used in 1 subtopic:470-20
substantive plan
The terms of the postretirement benefit plan as understood by an employer that provides postretirement benefits and the employees who render services in exchange for those benefits. The substantive plan is the basis for the accounting for that exchange transaction. In some situations an employer's cost-sharing policy, as evidenced by past practice or by communication of intended changes to a plan's cost-sharing provisions, or a past practice of regular increases in certain monetary benefits, may indicate that the substantive plan differs from the extant written plan.
Used in 1 subtopic:715-60
supplemental actuarial value
The amount assigned under the actuarial cost method in use to years before a given date.
Used in 1 subtopic:205-960
Supply
A cooperative that supplies to its patrons goods and services used by them in producing their products. Supply or purchasing cooperatives obtain or produce such items as building materials, equipment, feed, seeds, fertilizer, chemicals, and petroleum products for their patrons. See Purchasing Cooperative.
Used in 1 subtopic:905-10
support equipment and facilities
Support equipment and facilities used in oil- and gas-producing activities, such as seismic equipment, drilling equipment, construction and grading equipment, vehicles, repair shops, warehouses, supply points, camps, and division, district, or field offices.
supporting activities
Supporting activities are all activities of a not-for-profit entity (NFP) other than program services. Generally, they include the following: Management and general activities Fundraising activities Membership development activities.
surplus notes
Surplus notes are financial instruments issued by insurance entities that are includable in surplus for statutory accounting purposes as prescribed or permitted by state laws and regulations.
Used in 1 subtopic:470-944
surrender charge
A contractual fee imposed by the insurance entity when a policyholder surrenders the insurance policy that typically decreases over the life of the policy. The surrender charge represents a recovery of costs incurred by the insurance entity in originating the policy. It may or may not be explicitly called a surrender charge and can be embedded in other agreements besides the insurance contract. (Note: The use of this glossary term is not consistent among legal contracts. When determining the applicability of this term, the economic substance of the item shall be taken into consideration.)
surrender charges
Amounts expected to be assessed against policyholder balances at contract redemption, whole or partial, regardless of how the charges are labeled, such as contingent deferred sales charges.
Synthetic instrument accounting
Synthetic instrument accounting views two or more distinct financial instruments (generally a cash instrument and a derivative instrument) as having synthetically created another single cash instrument. The objective of synthetic instrument accounting is to present those multiple instruments in the financial statements as if they were the single instrument that the entity sought to create. Paragraph 815-10-25-4 states that synthetic instrument accounting is prohibited.
Used in 1 subtopic:815-10
Systematic Risk
The common risk shared by an asset or a liability with the other items in a diversified portfolio. Portfolio theory holds that in a market in equilibrium, market participants will be compensated only for bearing the systematic risk inherent in the cash flows. (In markets that are inefficient or out of equilibrium, other forms of return or compensation might be available.) Also referred to as nondiversifiable risk.
Used in 1 subtopic:820-10
t
tail coverage
Insurance designed to cover malpractice claims incurred before, but reported after, cancellation or expiration of a claims-made insurance policy.
Used in 1 subtopic:720-20
take-or-pay
An agreement between a purchaser and a seller that provides for the purchaser to pay specified amounts periodically in return for products or services. The purchaser must make specified minimum payments even if it does not take delivery of the contracted products or services.
tandem award
An award with two or more components in which exercise of one part cancels the other(s).
Used in 1 subtopic:718-10
tax (or benefit)
Tax (or benefit) is the total income tax expense (or benefit), including the provision (or benefit) for income taxes both currently payable and deferred.
Used in 1 subtopic:270-740
tax consequences
The effects on income taxes—current or deferred—of an event.
tax position
A position in a previously filed tax return or a position expected to be taken in a future tax return that is reflected in measuring current or deferred income tax assets and liabilities for interim or annual periods. A tax position can result in a permanent reduction of income taxes payable, a deferral of income taxes otherwise currently payable to future years, or a change in the expected realizability of deferred tax assets. The term tax position also encompasses, but is not limited to: A decision not to file a tax return An allocation or a shift of income between jurisdictions The characterization of income or a decision to exclude reporting taxable income in a tax return A decision to classify a transaction, entity, or other position in a tax return as tax exempt An entity's status, including its status as a pass-through entity or a tax-exempt not-for-profit entity.
tax-planning strategy
An action (including elections for tax purposes) that meets certain criteria (see paragraph 740-10-30-19) and that would be implemented to realize a tax benefit for an operating loss or tax credit carryforward before it expires. Tax-planning strategies are considered when assessing the need for and amount of a valuation allowance for deferred tax assets.
Used in 1 subtopic:740-10
taxable
Temporary differences that result in taxable amounts in future years when the related asset is recovered or the related liability is settled. See Temporary Difference.
taxable income
The excess of taxable revenues over tax deductible expenses and exemptions for the year as defined by the governmental taxing authority.
Temporary Difference
A difference between the tax basis of an asset or liability computed pursuant to the requirements in Subtopic 740-10 for tax positions, and its reported amount in the financial statements that will result in taxable or deductible amounts in future years when the reported amount of the asset or liability is recovered or settled, respectively. Paragraph 740-10-25-20 cites examples of temporary differences. Some temporary differences cannot be identified with a particular asset or liability for financial reporting (see paragraphs 740-10-05-10 and 740-10-25-24740-10-25-25), but those temporary differences do meet both of the following conditions: Result from events that have been recognized in the financial statements Will result in taxable or deductible amounts in future years based on provisions of the tax law. Some events recognized in financial statements do not have tax consequences. Certain revenues are exempt from taxation and certain expenses are not deductible. Events that do not have tax consequences do not give rise to temporary differences.
Used in 7 subtopics:718-740740-10740-20740-30740-805740-830+1 more
tentative minimum tax
An intermediate calculation used in the determination of a corporation's federal income tax liability under the alternative minimum tax system in the United States. See Alternative Minimum Tax.
Used in 1 subtopic:740-10
term endowment
An endowment fund established to provide income for a specified period. See Endowment Fund.
Term life insurance
Insurance that provides a benefit if the insured dies within the period specified in the contract. The insurance is for level or declining amounts for stated periods, such as 1, 5, or 10 years, or to a stated age. Term life insurance generally has no loan or cash value.
Used in 1 subtopic:944-20
terminal dividends
Dividends to policyholders calculated and paid upon termination of a contract, such as on death, surrender, or maturity.
terminal value
A component of reorganization value.Reorganization value calculated based on the discounting of cash flows normally consists of three parts; the discounted cash flows determined for the forecast period, the residual value or terminal value, and the current value of any excess working capital or other assets that are not needed in reorganization. Terminal or residual value represents the present value of the business attributable to the period beyond the forecast period.
Used in 1 subtopic:852-10
terminating plans
All plans about which a termination decision has been made regardless of whether the terminating plan will be replaced.
Termination
In general, the failure to renew an insurance contract. Involuntary terminations include death, expirations, and maturities of contracts. Voluntary terminations of life insurance contracts include lapses with or without cash surrender value and contract modifications that reduce paid-up whole-life benefits or term-life benefits.
Termination Benefits
Benefits provided by an employer to employees in connection with their termination of employment. They may be either special termination benefits offered only for a short period of time or contractual benefits required by the terms of a plan only if a specified event, such as a plant closing, occurs.
termination indemnities
Arrangements, usually or more frequently encountered outside the United States, that are also referred to as termination allowances or severance indemnities. Termination indemnities are amounts payable to eligible employees upon termination of employment. Eligibility may be determined by law, by local custom, by the employer's policy, or by contract with the employer. Plans may or may not be in writing. Termination indemnities are normally, but not exclusively, associated with preretirement severance of employment. They are usually payable as a lump sum, or occasionally in a few payments over a short period of time.
Used in 1 subtopic:715-30
termination rates
The rate at which insurance contracts fail to renew. Termination rates usually are expressed as a ratio of the number of contracts on which insureds failed to pay premiums during a given period to the total number of contracts at the beginning of the period from which those terminations occurred.
Used in 1 subtopic:944-40
territory
A geographic area in which a film is exploited. In most cases, a territory consists of a country. However, in certain instances, a territory may be defined as countries with a common language.
Used in 1 subtopic:926-20
testing
Performing the steps necessary to determine whether the coded computer software product meets function, feature, and technical performance requirements set forth in the product design.
Used in 1 subtopic:985-20
theoretical investment
See Nonregistered Investment Partnerships—Financial Highlights.
Used in 1 subtopic:205-946
throughput contracts
An agreement between a shipper (processor) and the owner of a transportation facility (such as an oil or natural gas pipeline or a ship) or a manufacturing facility that provides for the shipper (processor) to pay specified amounts periodically in return for the transportation (processing) of a product. The shipper (processor) is obligated to provide specified minimum quantities to be transported (processed) in each period and is required to make cash payments even if it does not provide the contracted quantities.
Used in 1 subtopic:440-10
time of issuance
The date when agreement as to terms has been reached and announced, even though the agreement is subject to certain further actions, such as directors' or stockholders' approval.
Used in 1 subtopic:470-20
time of the restructuring
Troubled debt restructurings may occur before, at, or after the stated maturity of debt, and time may elapse between the agreement, court order, and so forth, and the transfer of assets or equity interest, the effective date of new terms, or the occurrence of another event that constitutes consummation of the restructuring. The date of consummation is the time of the restructuring.
time value
The portion of the fair value of an option that exceeds its intrinsic value. For example, a call option with an exercise price of $20 on a stock whose current market price is $25 has intrinsic value of $5. If the fair value of that option is $7, the time value of the option is $2 ($7 - $5).
time value of an option
The time value of an option is equal to the fair value of an option less its intrinsic value.
Used in 1 subtopic:815-20
Time-Sharing
An arrangement in which a seller sells or conveys the right to occupy a dwelling unit for specified periods in the future. Forms of time-sharing arrangements include but are not limited to fixed and floating time, interval ownership, undivided interests, points programs, vacation clubs, right-to-use arrangements such as tenancy-for-years arrangements, and arrangements involving special-purpose entities. In this context, an undivided interest is a time-sharing arrangement that involves a tenant-in-common interest in a condominium unit or entire improved property, and in which the interest holder is assigned a specific period (generally, a specific week). The interest holder is also assigned a specific unit if the undivided interest is in the entire improved property.
Used in 10 subtopics:230-978310-978330-978340-978720-978810-978+4 more
timing risk
The risk arising from uncertainties about the timing of the receipt and payments of the net cash flows from premiums, commissions, claims, and claim settlement expenses paid under a contract.
Used in 1 subtopic:340-30
Title insurance entities
An entity that issues title insurance contracts to real estate owners, purchasers, and mortgage lenders, indemnifying them against loss or damage arising out of defects in, liens on, or challenges to their title to real estate.
Used in 1 subtopic:944-10
title plant
A historical record of all matters affecting title to parcels of land in a particular geographic area. The number of years covered by a title plant varies, depending on regulatory requirements and the minimum information period considered necessary to issue title insurance policies efficiently.
Used in 1 subtopic:350-950
Total Return
A measure of investment performance that focuses on the overall return on investments, including interest and dividend income as well as realized and unrealized gains and losses on investments. Frequently used in connection with a spending-rate formula to determine how much of that return will be used for fiscal needs of the current period.
Used in 1 subtopic:220-958
trading
An activity involving securities sold in the near term and held for only a short period of time. The term trading contemplates a holding period generally measured in hours and days rather than months or years. See paragraph 948-310-40-1 for clarification of the term trading for a mortgage banking entity.
trading purposes
The determination of what constitutes trading purposes is based on the intent of the issuer or holder and shall be consistent with the definition of trading in paragraph 320-10-25-1(a).
Used in 1 subtopic:815-10
Trading securities
Securities that are bought and held principally for the purpose of selling them in the near term and therefore held for only a short period of time. Trading generally reflects active and frequent buying and selling, and trading securities are generally used with the objective of generating profits on short-term differences in price.
traditional 12b-1 plan
A compensation or reimbursement plan pursuant to Rule 12b-1 that permits the use of a fund's assets to pay distribution-related expenses under certain conditions. The 12b-1 fees under traditional 12b-1 plans are normally discontinued upon plan termination, but may continue to be paid after plan termination under a board-contingent plan.
Used in 1 subtopic:946-20
traditional variable annuity
An insurance product in which all the contract holder's payments are used to purchase units of a separate account.
Transaction
An external event involving transfer of something of value (future economic benefit) between two (or more) entities. (See FASB Concepts Statement No. 6, Elements of Financial Statements.)(P) December 16, 2024; (N) December 16, 2025105-10-65-9An external event involving transfer of something of value (future economic benefit) between two (or more) entities.
Transaction Costs
The costs to sell an asset or transfer a liability in the principal (or most advantageous) market for the asset or liability that are directly attributable to the disposal of the asset or the transfer of the liability and meet both of the following criteria: They result directly from and are essential to that transaction. They would not have been incurred by the entity had the decision to sell the asset or transfer the liability not been made (similar to costs to sell, as defined in paragraph 360-10-35-38).
Used in 1 subtopic:820-10
transaction date
The date at which a transaction (for example, a sale or purchase of merchandise or services) is recorded in accounting records in conformity with generally accepted accounting principles (GAAP). A long-term commitment may have more than one transaction date (for example, the due date of each progress payment under a construction contract is an anticipated transaction date).
Transaction Gain or Loss
Transaction gains or losses result from a change in exchange rates between the functional currency and the currency in which a foreign currency transaction is denominated. They represent an increase or decrease in both of the following: The actual functional currency cash flows realized upon settlement of foreign currency transactions The expected functional currency cash flows on unsettled foreign currency transactions.
transaction price
The amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties.
Used in 8 subtopics:270-10275-10340-40450-10605-985606-10+2 more
Transfer
The term transfer is used in a broad sense consistent with its use in FASB Concepts Statement No. 6, Elements of Financial Statements (such as in paragraph 137), rather than in the narrow sense in which it is used in Subtopic 860-10. (P) December 16, 2024; (N) December 16, 2025105-10-65-9The term transfer is used in a broad sense, rather than in the narrow sense in which it is used in Subtopic 860-10.
Transferee
An entity that receives a financial asset, an interest in a financial asset, or a group of financial assets from a transferor.
Transferor
An entity that transfers a financial asset, an interest in a financial asset, or a group of financial assets that it controls to another entity.
Transferred Financial Assets
Transfers of any of the following: An entire financial asset A group of entire financial assets A participating interest in an entire financial asset.
transition asset
The amount, as of the date Subtopic 715-60 was initially applied, of the fair value of plan assets plus any recognized accrued postretirement benefit cost or less any recognized prepaid postretirement benefit cost in excess of the accumulated postretirement benefit obligation.
Used in 1 subtopic:715-60
transition obligation
The amount, as of the date Subtopic 715-60 was initially applied, of the accumulated postretirement benefit obligation in excess of the fair value of plan assets plus any recognized accrued postretirement benefit cost or less any recognized prepaid postretirement benefit cost.
Used in 1 subtopic:715-60
translate-restate
An approach to converting current cost-nominal functional currency data of a foreign operation into units of constant purchasing power expressed in dollars. Using this approach, the current cost-nominal functional currency data are first translated into dollars and then restated into units of constant purchasing power using the Consumer Price Index for All Urban Consumers.
Used in 1 subtopic:255-10
translation adjustment
Translation adjustments result from the process of translating financial statements from the entity's functional currency into the reporting currency.
Transportation Costs
The costs that would be incurred to transport an asset from its current location to its principal (or most advantageous) market.
Used in 1 subtopic:820-10
treasury stock method
A method of recognizing the use of proceeds that could be obtained upon exercise of options and warrants in computing diluted EPS. It assumes that any proceeds would be used to purchase common stock at the average market price during the period.
Used in 1 subtopic:260-10
Troubled Debt Restructuring
A restructuring of a debt constitutes a troubled debt restructuring if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider.
trustee
An entity that has a duty to hold and manage assets for the benefit of a specified beneficiary in accordance with a charitable trust agreement. In some states, not-for-profit entities (NFPs) are organized under trust law rather than as corporations. Those NFPs are not trustees as defined because, under those statutes, they hold assets in trust for the community or some other broadly described group, rather than for a specific beneficiary.
Used in 7 subtopics:205-958220-958605-958720-958852-10958-20+1 more
turnover
Termination of employment for a reason other than death or retirement.
Used in 1 subtopic:715-30
two-tier annuity
An annuity having two crediting rates applied to funds deposited into the contract. One rate is used to calculate the account balance if the contract holder elects to surrender the contract for cash, and is referred to as the lower tier. A second rate, typically higher, is used to calculate the account balance, but only if the contract holder elects to annuitize the contract, and is referred to as the upper tier.
u
Unallocated Contract
A contract with an insurance entity under which payments to the insurance entity are accumulated in an unallocated fund (not allocated to specific plan participants) to be used either directly or through the purchase of annuities, to meet benefit payments when employees retire. Funds held by the insurance entity under an unallocated contract may be withdrawn and otherwise invested.
uncollectibility
A situation in which, as a result of credit issues, the time-share seller is unable to collect all amounts due (both principal and interest) according to the contractual terms of a note receivable from a buyer, or a time-share receivable has not been written off but facts and circumstances indicate that it is probable that the seller will not collect all contractual payments. Any sale that, as a result of credit issues, is cancelled or modified subsequent to being recorded as a sale is considered uncollectible. For purposes of this definition, probable is defined in paragraph 450-20-25-1 as "likely to occur".
Used in 1 subtopic:310-978
Uncommitted loans
A mortgage loan that does not meet the specific terms of a commitment or for which a reasonable doubt exists about the acceptance of the loan under a commitment.
Used in 1 subtopic:310-948
Uncompleted wells, equipment, and facilities
Uncompleted wells, equipment, and facilities, the costs of which include those incurred to: Drill and equip wells that are not yet completed Acquire or construct equipment and facilities that are not yet completed and installed.
Used in 1 subtopic:360-932
unconditional promises to give
A promise to give that depends only on passage of time or demand by the promisee for performance.
Used in 7 subtopics:205-958310-958350-60405-958605-958720-25+1 more
unconditional purchase obligations
An obligation to transfer funds in the future for fixed or minimum amounts or quantities of goods or services at fixed or minimum prices (for example, as in take-or-pay contracts or throughput contracts).
underlying
A specified interest rate, security price, commodity price, foreign exchange rate, index of prices or rates, or other variable (including the occurrence or nonoccurrence of a specified event such as a scheduled payment under a contract). An underlying may be a price or rate of an asset or liability but is not the asset or liability itself. An underlying is a variable that, along with either a notional amount or a payment provision, determines the settlement of a derivative instrument.
Used in 9 subtopics:210-946460-10810-10815-10815-15815-20+3 more
Underlying Asset
An asset that is the subject of a lease for which a right to use that asset has been conveyed to a lessee. The underlying asset could be a physically distinct portion of a single asset.
Used in 30 subtopics:210-20220-40230-10255-10270-740310-10+6 more
Undersecured claim
A secured claim whose collateral is worth less than the amount of the claim. Sometimes referred to as an undersecured claim liability.
Used in 1 subtopic:852-10
Underwater Endowment Fund
A donor-restricted endowment fund for which the fair value of the fund at the reporting date is less than either the original gift amount or the amount required to be maintained by the donor or by law that extends donor restrictions.
Used in 1 subtopic:205-958
Underwriting Risk
The risk arising from uncertainties about the ultimate amount of net cash flows from premiums, commissions, claims, and claim settlement expenses paid under a contract.
Undeveloped Oil and Gas Reserves
See paragraph 932-10-S99-1, Regulation S-X Rule 4-10(a)(31), for the definition of undeveloped oil and gas reserves as used within that Rule.
Used in 1 subtopic:932-10
undivided interest
An ownership arrangement in which two or more parties jointly own property, and title is held individually to the extent of each party's interest.
unfunded accumulated postretirement benefit obligation
The accumulated postretirement benefit obligation in excess of the fair value of plan assets.
Used in 1 subtopic:715-60
unfunded projected benefit obligation
The excess of the projected benefit obligation over plan assets.
Used in 1 subtopic:715-30
Unguaranteed Residual Asset
The amount that a lessor expects to derive from the underlying asset following the end of the lease term that is not guaranteed by the lessee or any other third party unrelated to the lessor, measured on a discounted basis.
unguaranteed residual value
The estimated residual value of the leased property exclusive of any portion guaranteed by the lessee or by a third party unrelated to the lessor. A guarantee by a third party related to the lessee shall be considered a lessee guarantee. If the guarantor is related to the lessor, the residual value shall be considered as unguaranteed.
Used in 1 subtopic:255-10
unilateral ability
A capacity for action not dependent on the actions (or failure to act) of any other party.
Used in 1 subtopic:860-10
unilateral administrative order
Order issued unilaterally by the Environmental Protection Agency under section 106(a) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 to potentially responsible parties, or to nonpotentially responsible parties such as adjacent landowners, requiring them to take a response action. Unilateral administrative orders contain findings of fact and conclusions of law, and they specify the work to be performed and the Environmental Protection Agency's right to take over the work in the event of noncompliance, inadequate performance, or an emergency. A unilateral administrative order does not allocate conduct required by the order between individual potentially responsible parties; however, the Environmental Protection Agency may issue carve-out orders requiring individual potentially responsible parties to perform specific actions. Also referred to as a section 106 order.
Used in 1 subtopic:410-30
Unit of Account
The level at which an asset or a liability is aggregated or disaggregated in a Topic for recognition purposes.
Used in 1 subtopic:820-10
units-of-revenue method
A method of amortizing deferred revenue that arises under certain sales of future revenues. Under this method, amortization for a period is calculated by computing a ratio of the proceeds received from the investor to the total payments expected to be made to the investor over the term of the agreement, and then applying that ratio to the period's cash payment.
Used in 1 subtopic:470-10
Unknown Potentially Responsible Party
A party that has liability with respect to a Superfund site, but that has not yet been identified as a potentially responsible party by the Environmental Protection Agency or by an analogous state agency.
Used in 1 subtopic:410-30
Unobservable Inputs
Inputs for which market data are not available and that are developed using the best information available about the assumptions that market participants would use when pricing the asset or liability.
Used in 1 subtopic:820-10
unproved properties
Unproved properties are properties with no proved reserves.
Unproven Potentially Responsible Party
A party that has been identified as a potentially responsible party for a Superfund site by the U.S. Environmental Protection Agency or by an analogous state agency, but that does not acknowledge potential involvement with respect to the site because no evidence has been presented linking the party to the site. Also referred to as a hiding-in-the-weeds potentially responsible party.
Used in 1 subtopic:410-30
unrecognized tax benefit
The difference between a tax position taken or expected to be taken in a tax return and the benefit recognized and measured pursuant to Subtopic 740-10.
unsecured claim
A liability that is not secured by collateral. In the case of an undersecured creditor, the excess of the secured claim over the value of the collateral is an unsecured claim, unless the debtor elects in a Chapter 11 proceeding to have the entire claim considered secured. The term is generally used in bankruptcy to refer to unsecured claims that do not receive priority under the Bankruptcy Code. Sometimes referred to as an unsecured claim liability.
Used in 1 subtopic:852-10
Unsystematic Risk
The risk specific to a particular asset or liability. Also referred to as diversifiable risk.
Used in 1 subtopic:820-10
Unusual Nature
The underlying event or transaction should possess a high degree of abnormality and be of a type clearly unrelated to, or only incidentally related to, the ordinary and typical activities of the entity, taking into account the environment in which the entity operates (see paragraph 220-20-60-1).
upgrade
A time-sharing transaction whereby a customer relinquishes the right to a currently held time-sharing interval and obtains a higher-priced time-sharing interval from the same seller.
Used in 1 subtopic:330-978
v
valuation allowance
The portion of a deferred tax asset for which it is more likely than not that a tax benefit will not be realized.
Valuation of assets
See paragraph 962-205-S99-1, Regulation S-X Rule 6A-02(d), for the definition of the term value as used in that Rule.
Used in 1 subtopic:205-962
Value
See paragraph 946-10-S99-2, Regulation S-X Rule 6-02(b), or paragraph 946-320-S99-12, CFRR 404.03.b.i, for the definition of value.
Used in 1 subtopic:946-10
value beyond proven and probable reserves
Value beyond proven and probable reserves is the economic value that exists in a mining asset beyond the value attributable to proven and probable reserves. The distinction between the categories of reserves relates to the level of geological evidence and, therefore, confidence in the reserve estimates.
value in use
The amount determined by discounting the future cash flows (including the ultimate proceeds of disposal) expected to be derived from the use of an asset at an appropriate rate that allows for the risk of the activities concerned.
Used in 1 subtopic:255-10
variable annuity contract
An annuity in which the amount of payments to be made are specified in units, rather than in dollars. When payment is due, the amount is determined based on the value of the investments in the annuity fund.
Variable Interest Entity
A legal entity subject to consolidation according to the provisions of the Variable Interest Entities Subsections of Subtopic 810-10.
Variable Interests
The investments or other interests that will absorb portions of a variable interest entity's (VIE's) expected losses or receive portions of the entity's expected residual returns are called variable interests. Variable interests in a VIE are contractual, ownership, or other pecuniary interests in a VIE that change with changes in the fair value of the VIE's net assets exclusive of variable interests. Equity interests with or without voting rights are considered variable interests if the legal entity is a VIE and to the extent that the investment is at risk as described in paragraph 810-10-15-14. Paragraph 810-10-25-55 explains how to determine whether a variable interest in specified assets of a legal entity is a variable interest in the entity. Paragraphs 810-10-55-16810-10-55-17810-10-55-18810-10-55-19810-10-55-20810-10-55-21810-10-55-22810-10-55-23810-10-55-24810-10-55-25810-10-55-26810-10-55-27810-10-55-28810-10-55-29810-10-55-30810-10-55-31810-10-55-32810-10-55-33810-10-55-34810-10-55-35810-10-55-36810-10-55-37810-10-55-38810-10-55-39810-10-55-40810-10-55-41 describe various types of variable interests and explain in general how they may affect the determination of the primary beneficiary of a VIE.
Variable Lease Payments
Payments made by a lessee to a lessor for the right to use an underlying asset that vary because of changes in facts or circumstances occurring after the commencement date, other than the passage of time.
Used in 9 subtopics:410-20450-10450-20450-30460-10815-15+3 more
variable-rate forward contract
Variable-rate forward contracts are commonly used to effect equity forward transactions. The contract price on those forward contracts is not fixed at inception but varies based on changes in a specified index (for example, three-month U.S. London Interbank Offered Rate [LIBOR]) during the life of the contract.
Used in 1 subtopic:480-10
Variance Power
The unilateral power to redirect the use of the transferred assets to another beneficiary. A donor explicitly grants variance power if the recipient entity's unilateral power to redirect the use of the assets is explicitly referred to in the instrument transferring the assets. Unilateral power means that the recipient entity can override the donor's instructions without approval from the donor, specified beneficiary, or any other interested party.
Vendor
A service provider or product seller, such as a manufacturer, distributor, or reseller.
Vest
To earn the rights to. A share-based payment award becomes vested at the date that the grantee's right to receive or retain shares, other instruments, or cash under the award is no longer contingent on satisfaction of either a service condition or a performance condition. Market conditions are not vesting conditions. The stated vesting provisions of an award often establish the employee's requisite service period or the nonemployee's vesting period, and an award that has reached the end of the applicable period is vested. However, as indicated in the definition of requisite service period and equally applicable to a nonemployee's vesting period, the stated vesting period may differ from those periods in certain circumstances. Thus, the more precise terms would be options, shares, or awards for which the requisite good has been delivered or service has been rendered and the end of the employee's requisite service period or the nonemployee's vesting period.
vested benefit information
The actuarial present value of vested accumulated plan benefits.
Used in 1 subtopic:960-20
Vested Benefits
Benefits for which the employee's right to receive a present or future pension benefit is no longer contingent on remaining in the service of the employer. (Other conditions, such as inadequacy of the pension fund, may prevent the employee from receiving the vested benefit.) Under graded vesting, the initial vested right may be to receive in the future a stated percentage of a pension based on the number of years of accumulated credited service; thereafter, the percentage may increase with the number of years of service or of age until the right to receive the entire benefit has vested.
vineyards
Grapevines planted in patterns for commercial cultivation and production.
Used in 1 subtopic:360-905
violation of a provision
The failure to meet a condition in a debt agreement or a breach of a provision in the agreement for which compliance is objectively determinable, whether or not a grace period is allowed or the creditor is required to give notice of its intention to demand repayment.
Used in 1 subtopic:470-10
volatility
A measure of the amount by which a financial variable such as a share price has fluctuated (historical volatility) or is expected to fluctuate (expected volatility) during a period. Volatility also may be defined as a probability-weighted measure of the dispersion of returns about the mean. The volatility of a share price is the standard deviation of the continuously compounded rates of return on the share over a specified period. That is the same as the standard deviation of the differences in the natural logarithms of the stock prices plus dividends, if any, over the period. The higher the volatility, the more the returns on the shares can be expected to vary—up or down. Volatility is typically expressed in annualized terms.
voluntary health and welfare entity
A not-for-profit entity (NFP) that is formed for the purpose of performing voluntary services for various segments of society and that is tax exempt (organized for the benefit of the public), supported by the public, and operated on a not-for-profit basis. Most voluntary health and welfare entities concentrate their efforts and expend their resources in an attempt to solve health and welfare problems of our society and, in many cases, those of specific individuals. As a group, voluntary health and welfare entities include those NFPs that derive their revenue primarily from voluntary contributions from the general public to be used for general or specific purposes connected with health, welfare, or community services. For purposes of this definition, the general public excludes governmental entities when determining whether an NFP is a voluntary health and welfare entity.
Used in 1 subtopic:325-958
w
warrant
A security that gives the holder the right to purchase shares of common stock in accordance with the terms of the instrument, usually upon payment of a specified amount.
Used in 1 subtopic:260-10
Warranty
A guarantee for which the underlying is related to the performance (regarding function, not price) of nonfinancial assets that are owned by the guaranteed party. The obligation may be incurred in connection with the sale of goods or services; if so, it may require further performance by the seller after the sale has taken place.
weather derivative
A forward-based or option-based contract for which settlement is based on a climatic or geological variable. One example of such a variable is the occurrence or nonoccurrence of a specified amount of snow at a specified location within a specified period of time.
whole-life contracts
Insurance that may be kept in force for a person's entire life by paying one or more premiums. It is paid for in one of three different ways: Ordinary life insurance (premiums are payable as long as the insured lives) Limited-payment life insurance (premiums are payable over a specified number of years) Single-premium life insurance (a lump-sum amount paid at the inception of the insurance contract). The insurance contract pays a benefit (contractual amount adjusted for items such as policy loans and dividends, if any) at the death of the insured. Whole-life insurance contracts also build up nonforfeiture benefits.
With Cause
With cause generally restricts the limited partners' ability to dissolve (liquidate) the limited partnership or remove the general partners in situations that include, but that are not limited to, fraud, illegal acts, gross negligence, and bankruptcy of the general partners.
Without Cause
Without cause means that no reason need be given for the dissolution (liquidation) of the limited partnership or removal of the general partners.
working capital
Working capital (also called net working capital) is represented by the excess of current assets over current liabilities and identifies the relatively liquid portion of total entity capital that constitutes a margin or buffer for meeting obligations within the ordinary operating cycle of the entity.
working model
An operative version of the computer software product that is completed in the same software language as the product to be ultimately marketed, performs all the major functions planned for the product, and is ready for initial customer testing (usually identified as beta testing).
Used in 1 subtopic:985-20
Workout expenditures
Professional fees (legal, accounting, appraisal) paid to entities unaffiliated with the investment company's advisor or sponsor in connection with any of the following: Capital infusions Restructurings or plans of reorganization Ongoing efforts to protect or enhance an investment The pursuit of other claims or legal actions.
Used in 1 subtopic:320-946
wraps
The practice of adding an insurance benefit feature to a separate noninsurance contract generally from a different issuer.
Used in 1 subtopic:944-40
Written Notice of Allocation
Any capital stock, revolving fund certificate, retain certificate, certificate of indebtedness, letter of advice, or other written notice to the recipient that states the dollar amount allocated to the patron by the cooperative and the portion that constitutes a patronage dividend.
z
zero-coupon method
A swap valuation method that involves computing and summing the present value of each future net settlement that would be required by the contract terms if future spot interest rates match the forward rates implied by the current yield curve. The discount rates used are the spot interest rates implied by the current yield curve for hypothetical zero coupon bonds due on the date of each future net settlement on the swap.