Wednesday, December 14, 2011

Financial Glossary

1. Acid test

A stern measure of a company's ability to pay its short term debts, in that stock is excluded from asset value. (liquid assets/current liabilities) Also referred to as the Quick Ratio.

2. Gearing

The ratio of debt to equity, usually the relationship between long-term borrowings and shareholders' funds.

3. t/t (telegraphic transfer)

Interntional banking payment method: a telegraphic transfer payment, commonly used/required for import/export trade, between a bank and an overseas party enabling transfer of local or foreign currency by telegraph, cable or telex. Also called a cable transfer. The terminology dates from times when such communications were literally 'wired' - before wireless communications technology

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