Glossary
T
63 terms
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.