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EAD- Exposure at Default The total exposure a bank faces at default. Every underlying exposure is assigned an EAD value within a bank's internal system. Using the IRB method, banks determine their EAD systems using their own default models for risk management. … [Read more...]
EBIT (Earnings Before Interest and Taxes) Calculated as revenues minus cost incurred for goods sold plus expenses pertaining to selling, administrative and general expenses. Profit earned from operating as well as non-operating sources prior to interest and tax deductions. … [Read more...]
EDI- Electronic Data Interchange Electronic information exchange done in structured manner, from one firm's computer directly to another’s computer. … [Read more...]
EOQ- Economic Order Quantity Quantity that should be ordered to minimize total costs associated with inventory. … [Read more...]
ESOP- Employee Stock Ownership Plan A contribution to trust funds by companies for stock investments done for employees on their behalf. … [Read more...]
EAFE Index Morgan Stanley’s European, Australian, Far East stock index. … [Read more...]
Early Exercise Exercising options or other securities before the date of maturity. … [Read more...]
Earning Power Calculation of earnings prior to adjustment of interest and taxes payable (EBIT) when divided by assets of the business in total. Earnings that are possible under optimal conditions. … [Read more...]
Earnings Post tax net income earned in a period by business. … [Read more...]
Earnings Announcement Public statement of profitability over a given period presented by a company. Normally the period covered is a quarter or a year. Generally presented on a specific date in the course of the earnings season and follows estimates given by analysts. A period of … [Read more...]
Earnings per Share Profit of a company divided by number of shares outstanding. A company that earns $5 million this year and has 5 million shares outstanding, has an EPS of $1 for each share. Often the weighted average of outstanding shares is used for this calculation. … [Read more...]
Earnings Retention Ratio Also termed the plowback rate. The proportion of earnings retained in business. … [Read more...]
Earnings Recast Amendment of an earnings statement, that has already been previously released, and re-releasing after changes made with a specific intent. Non representative or non recurring earnings may be separated from the statement during recasting to show a more accurate … [Read more...]
Earnings Surprises Any deviation from consensus forecast about earnings provided by First Call, IBES or similar institutions. Negative difference have adverse effect on the price of stock to a greater degree than favorable impact of positive difference. … [Read more...]
Earnings Yield A percentage representing earnings for each share (EPS) after interest and tax deductions for debt carrying fixed interest as compared to current price of share, expressed as ratio. Inverse ratio to P/E ratio. Total of earnings over Twelve Months divided by total … [Read more...]
Economic Assumptions The conditions of the economy that are expected to prevail throughout the term of the financial plan outlined by a company. … [Read more...]
Economic Dependence Arises when costs and earnings related to a project are dependent on those incurred and generated by a second project. … [Read more...]
Economic Cycle Fluctuation and movement normally witnessed in the economy in between times of expansion and contraction. The prevailing phase of the economic cycle is determined by many factors such as (GDP), employment rates, interest rates, and spending. … [Read more...]
Economic Defeasance Refer: in substance defeasance. Process wherein debt is not cancelled but is not shown in balance sheet. … [Read more...]
Economic Earnings In event of zero change in productive capacity of the firm, the real funds flow that can be paid out indefinitely by it. … [Read more...]
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