Tracking Financial Performance Standards of ... - Sa-Dhan

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Tracking Financial Performance Standards of Microfinance InstitutionsTermCostCost AccountingCreditCredit BalanceCredit PeriodCredit TermsCredit Union:CreditCreditorCurrent AssetCurrent Cost StatementsDefinitionThe financial measure of resources consumed in accomplishing a specificpurpose such as performing a service, carrying out an activity, or completinga unit of work or a specific project. An input into the manufacturing of aproduct. There are three common inputs in manufacturing: (1) raw materials,(2) direct labor, and (3) factory overhead.Procedures used for rationally classifying, recording, and allocating current orpredicted costs that relate to a certain product or production process. Thefield of accounting that is used to determine the dollar value of goods that aremanufactured. Accounts that are presented on the income statement; used todetermine the cost of goods sold to customers.Entry on the right side of a Double-entry bookkeeping system that representsthe reduction of an Asset or expense or the addition to a liability or revenue.(See Debit.) The allowance of cash, goods, or services in the present, withpayment expected in the future. To credit (Cr.) an account means to enter anamount on the right, or credit, side of the account.Balance remaining after one of a series of bookkeeping entries. This amountrepresents a liability or income to the entity. (See Balance.) Occurs when theamount on the credit side of an account is greater than the amount on thedebit side.The amount of time a seller allows a credit customer to pay for a purchase.The terms for payment set by a seller of goods or services; includes the amountof time before payment is due and the rate of discount (if any) for payingearly.In the financial sector, co-operatives which enable savings to be made andloans to be taken are generally known as "credit unions" which are registeredunder the legislation dealing with co-operatives in each country. The basiccredit union is composed of a group of people having a "common bond" whomay be resident in the same neighbourhood or employed at the same place ofwork, or it can be a religious or ethnic grouping. The principal reason for theemphasis on a common bond is that the social pressure of the group isconsidered a very important condition as security for loans It is a form ofcollateral which is not available in conventional finance [UN-ESCAP (1991)].(1) The right side of an account; (2) the amount entered on the right side ofan account; (3) to enter an amount on the right side of an account.Party that loans money or other assets to another party. A business or personto whom a debt is owed.Asset that one can reasonably expect to convert into cash, sell, or consume inoperations within a single operating cycle, or within a year if more than onecycle is completed each year. Cash and assets that will be sold, used up, orturned into cash within the current accounting period, usually one year. Besidescash, examples are receivables, supplies, and merchandise inventory.The financial statements that result when historical costs reported inconventional statements are adjusted for specific price-level changes, so thatall elements of the statements are reported at their current costs.120
Glossary of Financial TermsTermCurrent LiabilitiesCurrent RatioCurrent ValueDebitDebit BalanceDebtDebt ServiceDebtorDecentralized BranchAccountingDeclining-BalanceDepreciation MethodDefaultDefinitionDebts that are due for payment within one year. Examples are accounts payable,salaries payable, sales tax payable, and the current portion of notes payable.Obligations a company has to others, such as creditors, suppliers, & taxauthorities, payable within one year. Listed in the liabilities category on thestatement of financial position. Obligation whose liquidation is expected torequire the use of existing resources classified as current assets, or the creationof other current liabilities. A liability that will be due within a short time(usually one year or less) and that is to be paid out of current assets.Current assets divided by current liabilities -- a measure of liquidity. Generally,the higher the ratio, the greater the "cushion" between current obligationsand a firm's ability to meet them. The ratio obtained by dividing currentassets by current liabilities. It is an indicator of a firm's ability to pay its shorttermdebts as they become due. The ratio of current assets to current liabilities.(1) Value of an asset at the present time as compared with the asset's HistoricalCost. (2) In finance, the amount determined by discounting the future revenuestream of an asset using compound interest principles.Entry on the left side of a double-entry bookkeeping system that representsthe addition of an Asset or expense or the reduction to a Liability or Revenue.(See Credit.) To debit (Dr.) an account means to enter an amount on the left,or debit, side of the account.Balance remaining after one or a series of bookkeeping entries. This amountrepresents an Asset or an expense of the entity. (See Balance.) Occurs whenthe amount(s) on the debit side of an account is greater than the amount(s) onthe credit side.An amount owed for funds borrowed. The debt may be owed to anorganization's own reserves, individuals, banks, or other institutions. Generally,the debt is secured by a note, bond, mortgage, or other instrument that statesrepayment and interest provisions. The note, in turn, may be secured by a lienagainst property or other assets. General name for money, notes, bonds, goodsor services which represent amounts owed.Amount of payment due regularly to meet a debt agreement; usually a monthly,quarterly or annual obligation.Party owing money or other Assets to a Creditor.A system of accounting for branches in which each branch keeps its ownrecords and prepares its own financial statements.A method of depreciation that provides declining periodic depreciation chargesto expense over the estimated life of a asset.A failure to discharge a duty. The term is most often used to describe theoccurrence of an event that cuts short the rights or remedies of one of theparties to an agreement or legal dispute, for example, the failure of themortgagor to pay a mortgage installment, or to comply with mortgagecovenants. Failure to meet any financial obligation. Default triggers a creditor'srights and remedies identified in the agreement and under the law.121
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TECHNICAL TOOL SERIES 1TRACKING FIN
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INTRODUCTION TOMICROFINANCE STANDAR
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5. PERFORMANCE STANDARDS - CONCEPT,
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ACKNOWLEDGMENTSThe need of the oper
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