English

Inventory turnover is a financial ratio that measures the number of times a company sells and replaces its inventory during a certain period, usually a fiscal year. It is a key indicator of a company’s operational efficiency and its management of inventory levels. The formula to calculate inventory turnover is: Inventory Turnover = Cost of… read more »

The Fixed Asset Turnover (FAT) ratio is a measure used in financial analysis to assess a company’s effectiveness in using its fixed assets, such as property, plant, and equipment, to generate sales. It is a type of efficiency ratio that indicates how well a company uses its fixed assets to generate revenue. The ratio is… read more »

Invoice processing time can vary greatly depending on the method of processing, the complexity of the invoice, and the practices of the specific organization. Here are a few general time frames: 1. Manual Processing: Manual invoice processing can be time-consuming. It typically involves several steps: receiving the invoice, checking it for accuracy, matching it to… read more »

Net Profit Margin is a profitability ratio that illustrates how much of every dollar of revenue earned results in net income, or profit after all expenses. It’s a key indicator of a company’s financial health, revealing the proportion of money left over from revenues after accounting for cost of goods sold, interest, taxes, operating and… read more »

Gross Profit Margin, also known as Gross Margin, is a key profitability metric for a company. It represents the percent of total sales revenue that the company retains after incurring the direct costs associated with producing the goods and services sold by the company. The formula for calculating the gross profit margin is: Gross Profit… read more »

The Debt-to-Equity (D/E) ratio is a financial leverage ratio that compares a company’s total debt to its total equity. It gives both investors and creditors an understanding of how risky a company’s financing strategy is, and shows the proportion of financing that comes from creditors (in the form of debt) versus the one coming from… read more »

Operational risk event that results in a loss to the bank. According to the list in Basel II, which is more exemplary and therefore not comprehensive of all events, these are in particular – fraud from within, – fraud from outside, – employment practices and security, – customers, products and business working practices, – interruption… read more »

The hardly rationally explainable but empirically well-documented fact that both private investors and companies are inclined to let losses run their course instead of drawing a painful line under the commitment at an early stage. – See memory, money grave, money swallower, head-in-the-sand behavior, million grave, financial psychology, myopia, torpedo capital, loss, incurred, waste watcher…. read more »