|
a
| b
| c
| d
| e
| f
| g
| h
| i
| j
| k
| l
| m
| n
| o
| p
| q
| r
| s
| t
| u
| v
| w
I
ideal standard
A standard that is only attainable under the most favourable
conditions and makes no allowance for normal loss, waste
and machine downtime.
indirect cost
An indirect cost is a cost that is untraceable to particular
units. It is expenditure on labour, materials or services
which cannot be economically identified with a specific
saleable cost unit. Such costs have to be allocated, that
is assigned to a single cost unit, cost centre, or cost
account or time period. The term 'burden' used by American
companies is synonymous with indirect costs or overheads.
indirect method
A method of calculating cash flow which uses the starting
point of operating profit, since it is the operating activities
of sales and costs that normally give rise to the majority
of cash inflows and cash outflows of an entity. Operating
profit for the period must then be adjusted for depreciation,
as well as movements in stock, debtors and creditors over
the same period to derive the net cash flow from operating
activities.
inflation
A general increase in the price level over time. In a period
of hyper inflation the rate at which the price level rises
has become extremely high, and possibly out of control.
insolvency
The inability of a company, partnership or individual to
pay creditors' debts in full after realisation of all the
assets of the business.
intangible assets
Assets, except for investments in subsidiary companies,
which do not have a physical identity and include software,
patents, trademarks, and goodwill (FRS 10).
interdependency concept
Management accounting, in recognition of the increasing
complexity of business, must access both internal and external
information sources from interactive functions such as marketing,
production, personnel, procurement and finance. This assists
in ensuring that the information is adequately balanced.
interest cover
Profit before interest and tax divided by interest payable,
calculates the number of times the interest payable is covered
by profits available for such payments. It is particularly
important for lenders to determine the vulnerability of
interest payments to a drop in profit.
inter-firm comparison
Systematic and detailed comparison of the performance of
different companies generally operating in a common industry.
Normally the information distributed by the scheme administrator
(to participating companies only) is in the form of ratios,
or in a format, which prevents the identity of individual
scheme members from being identified.
internal audit
An independent appraisal function established within an
organisation to examine and evaluate its activities as a
service to the organisation. The objective of internal auditing
is to assist members of the organisation in the effective
discharge of their responsibilities. To this end, internal
auditing furnishes them with analyses, appraisals, recommendations,
counsel and information concerning the activities reviewed
(Institute of Internal Auditors - UK).
internal control
As defined in the Cadbury Report, it is the whole system
of controls, financial or otherwise, established in order
to provide reasonable assurance of
(a) effective and efficient operation
(b) internal financial control
(c) compliance with laws and regulations.
internal rate of return (IRR)
The annual percentage return achieved by a project, at which
the sum of the discounted cash inflows over the life of
the project is equal to the sum of the discounted cash outflows.
investment
Any application of funds which is intended to provide a
return by way of interest, dividend or capital appreciation.
investment centre
A profit centre with additional responsibilities for capital
investment and possibly for financing, and whose performance
is measured by its return on investment - the manager is
responsible for investments, revenues and costs.
|
