Glossary
R
96 terms
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.