Glossary
A
81 terms
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.