Business Terms You Should Know ACCOUNTANT A qualified person that prepares and maintains the financial records

of a business. With more training than a bookkeeper, an accountant has a larger responsibility including preparing financial statements using the data recorded by the bookkeeper. Trade accounts of businesses representing obligations to pay for goods and services received. The amounts owed to a company by its customers such as those for services rendered but not yet paid for, or for goods delivered and not yet paid for. The recording, classifying, summarizing, and interpreting in a significant manner and in terms of money, transactions, and events of a financial character. Close association of groups or businesses. A public sale of goods to the highest bidder. A statement of assets, liabilities, and capital at a specific period of time. Assets = Liabilities + Capital. The Balance Sheet is a "snapshot" of a company's financial standing at one point in time. It is used to determine the financial status of a company, what the company's present value is. A condition in which a business cannot meet its debt obligations and petitions a federal district court for either reorganization of its debts or liquidation of its assets. Benefits comprise the second half of the compensation equation (the first half is pay). Most benefits are optional and include such items as medical and life insurance, reimbursement accounts, retirement plans, access to health clubs, profit-sharing programs, and even use of a company vehicle. The process by which an employer can be indemnified for the loss of money or property sustained through dishonest acts of a "bonded" employee. This can cover many types of unlawful acts including embezzlement, forgery, larceny, theft, misappropriation, or other dishonest acts. A person that records and keeps all the financial transactions or "books" of a business. The point at which the volume of sales or revenues exactly equals total expensesthe point at which there is neither a profit nor lossunder varying levels of activity. An organization or organized effort that operates with the objective of earning a profit from the sale of goods or services. A comprehensive planning document which clearly describes the business developmental objective of an existing or proposed business. The plan outlines what and how and from where the resources needed to accomplish the objective will be obtained and utilized. A stock of accumulated goods devoted to the production of goods or generation of income. From a financial standpoint, capital can be calculated as assets less liabilities, representing the ownership interest in a business. Business spending on additional plant equipment and inventory. Personal property of the business which has an average dollar value of $300.00 or more

ACCOUNTS PAYABLE

ACCOUNTS RECEIVABLE

ACCOUNTING

ALLIANCE AUCTION BALANCE SHEET

BANKRUPTCY

BENEFITS

BONDING

BOOKKEEPER BREAKEVEN POINT

BUSINESS

BUSINESS PLAN

CAPITAL

CAPITAL EXPENDITURES CAPITALIZED PROPERTY

and a life expectancy of one year or more. Capitalized property shall be depreciated annually over the expected useful life to the business. CASH DISCOUNT An incentive offered by the seller to encourage the buyer to pay within a stipulated time. For example, if the terms are 2/10/N 30, the buyer may deduct 2% from the amount of the invoice (if paid within 10 days); otherwise, the full amount is due in 30 days. An accounting presentation showing how much of the cash generated by the business remains after both expenses (including interest) and principal repayment on financing are paid. A projected cash flow statement indicates whether the business will have cash to pay its expenses, loans, and make a profit. An accounting transaction removing an uncollectable balance from the active receivable accounts. A regular customer that receives your professional services. Something of valuesecurities, evidence of deposit, or other propertypledged to support the repayment of an obligation. A legal document covering the item(s) pledged as collateral on a loan, i.e., note, mortgages, assignment, etc. The buying and selling of goods. A coalition of organizations such as banks and corporations set up to fund ventures requiring large capital resources. A person hired to give advice to business management. One who agrees to perform a service or deliver a product for a price. The direct cost of all items sold during an accounting period. In a retail environment, this is usually calculated by taking the inventory held at the beginning of the period, adding inventory purchases, and subtracting the inventory held at the end of the period. In a manufacturing environment, these costs may include all of the supplies used to build the items sold as well as the amount paid to employees who built the items. A group of persons granted a state charter legally recognizing them as a separate entity having its own rights, privileges, and liabilities distinct from those of its members. The process of incorporating should be completed with the state's secretary of state or state corporate counsel, and usually requires the services of an attorney. Money obligated for goods and services received during a given period of time, regardless of when ordered or whether paid for. A grade assigned to a business concern to denote the net worth and credit standing to which the concern is entitled in the opinion of the rating agency as a result of its investigation. All obligations due and payable within one year. These obligations might be cash debts owed, or services paid for but not yet rendered, or goods received but not yet paid for. Business financing that normally requires periodic interest payments and repayment of the principal within a specified time.

CASH FLOW

CHARGE-OFF

CLIENT COLLATERAL

COLLATERAL DOCUMENT

COMMERCE CONSORTIUM

CONSULTANT CONTRACTOR COST OF GOODS SOLD

CORPORATION

COSTS

CREDIT RATING

CURRENT LIABILITIES

DEBT CAPITAL

DEBT FINANCING

The provision of long term loans to small business concerns in exchange for debt securities or a note. A document under seal which, when delivered, transfers a present interest in property. May be held as collateral. The nonpayment of principal and/or interest on the due date as provided by the terms and conditions of the note. Loans whose principal and or interest installments are postponed for a specified period of time. The actual payout to borrower of loan funds, in whole or part. It may be concurrent with the closing or follow it. Change of ownership and/or control of a business. The demonstrated ability of a business to earn a profit, over time, while following good accounting practices. When a business shows a reasonable profit on invested capital after fully maintaining the business property, appropriately compensating its owner and employees, servicing its obligations, and fully recognizing its costs, the business may be said to have demonstrated earning power. A right or privilege that a person may have on another's land, as the right of a way or ingress or egress. Buying and selling done over the Internet. Aggregation of all establishments owned by a parent company. An enterprise can consist of a single, independent establishment or it can include subsidiaries or other branch establishments under the same ownership and control. One who assumes the financial risk of the initiation, operation, and management of a given business or undertaking. An ownership interest in a business. The provision of funds for capital or operating expenses in exchange for capital stock, stock purchase warrants, and options in the business financed without any guaranteed return, but with the opportunity to share in the company's profits. Equity financing includes long-term subordinated securities containing stock options and/or warrants. A limited partnership arrangement for providing startup and seed capital to businesses. Funds placed in trust with a third party by a borrower for a specific purpose and to be delivered to the borrower only upon the fulfillment of certain conditions. A single-location business unit, which may be independentcalled a singleestablishment enterpriseor owned by a parent enterprise. Reports commonly required from applicants request for financial assistance, e.g.: 1. Balance Sheet - A report of the status of a firm's assets, liabilities, and owner's equity at a given time. 2. Income Statement - A report of revenue and expense which shows the results of business operations or net income for a specified period of time. 3. Cash Flow - A report which analyzes the actual or projected source and disposition of cash during a past or future accounting period.

DEED OF TRUST

DEFAULTS

DEFERRED LOAN

DISBURSEMENT

DIVESTITURE EARNING POWER

EASEMENT

E-COMMERCE ENTERPRISE

ENTREPRENEUR

EQUITY EQUITY FINANCING

EQUITY PARTNERSHIP ESCROW ACCOUNTS

ESTABLISHMENT

FINANCIAL REPORTS

FINANCING

New funds provided to a business, by either loans, purchase of debt securities, or capital stock. Expenses that do not change with different levels of production or sales, for example: rent expense.

FIXED EXPENSES

FORECLOSURE

The act by the mortgagee or trustee upon default in the payment of interest or principal of a mortgage of enforcing payment of the debt by selling the underlying security. A continuing relationship in which the franchisor provides a licensed privilege to the franchisee to do business and offers assistance in organizing, training, merchandising, marketing, and managing in return for a consideration. Franchising is a form of business by which the owner (franchisor) of a product, service, or method obtains distribution through affiliated dealers (franchisees). The product, method, or service being marketed is usually identified by the franchisor's brand name, and the holder of the privilege (franchisee) is often given exclusive access to a defined geographical area. A loan made and serviced by a lending institution under agreement that a governmental agency will purchase the guaranteed portion if the borrower defaults. A term used to describe the mechanical, electrical, and electronic elements of a data processing system. Also known as the Profit & Loss Statement (P&L) is the statement of net profit or loss in a specific accounting period. Often run monthly, quarterly, and annually to show net profit or loss for a particular month, quarter, or year. A facility designed to encourage entrepreneurship and minimize obstacles to new business formation and growth, particularly for high technology firms, by housing a number of fledgling enterprises that share an array of services. These shared services may include meeting areas, secretarial services, accounting services, research libraries, on-site financial and management counseling, and word processing facilities.
Public accountants are independent when neither they nor any of their family have a material, direct, or indirect financial interest in the borrower other than as an accountant. Introduction of a new idea into the marketplace in the form of a new product or service or an improvement in organization or process. The inability of a borrower to meet financial obligations as they mature or having insufficient assets to pay legal debts.

FRANCHISING

GUARANTEED LOAN

HARDWARE

INCOME STATEMENT

INCUBATOR

INDEPENDENT AND QUALIFIED PUBLIC ACCOUNTANTS INNOVATION

INSOLVENCY

INTEREST INVESTMENT BANKING

An amount paid a lender for the use of funds. Businesses specializing in the formation of capital. This is done by outright purchase and sale of securities offered by the issuer, standby underwriting, or "best efforts selling." Formal solicitations for offerings to perform procurements by competitive bids when the specifications describe the requirements of the government clearly, accurately, and completely, but avoiding unnecessarily restrictive specifications or requirements which might unduly limit the number of bidders. A written statement listing the elements of a particular job or occupation, e.g., purpose, duties, equipment used, qualifications, training, physical and mental demands, working conditions, etc. A contract between the owner (leassor) and the tenant (leassee) stating the conditions under which the tenant may occupy or use the property. The maximum rate of interest fixed by the laws of the various states which a lender may charge a borrower for the use of money. Any institution, including a commercial bank, savings and loan association, commercial finance company, or other lender qualified to participate with SBA in the making of loans. A charge upon or security interest in real or personal property maintained to ensure the satisfaction of a debt or duty ordinarily arising by operation of law. The disposal, at maximum prices, of the collateral securing a loan and the voluntary and enforced collection of the remaining loan balance from the obligators and/or guarantors. The net value realizable in the sale (ordinarily a forced sale) of a business or a particular asset. The practice of taking legal action through the judicial process. Agreement to be executed by borrower, containing pertinent terms, conditions, covenants, and restrictions. The total amount of money needed to meet a borrower's obligation on a loan. It is arrived at by accruing gross interest for one day and multiplying this figure by the number of days that exist between the date of the last repayment and the date on which the loan is to be completely paid off. This amount, known as accrued interest, is combined with the latest principal and escrow balances that are applicable to what is now referred to as the loan payoff amount. Markup is the difference between invoice cost and selling price. It may be expressed either as a percentage of the selling price or the cost price and is supposed to cover all the costs of doing business plus a profit. Whether markup is based on the selling price or the cost price, the base is always equal to 100%. A combination of two or more corporations wherein the dominant unit absorbs the passive ones, the former continuing operation usually under the same name. In a consolidation two units combine and are succeeded by a new corporation, usually with a new title.

INVITATION FOR BIDS

JOB DESCRIPTION

LEASE

LEGAL RATE OF INTEREST

LENDING INSTITUTION

LIEN

LIQUIDATION

LIQUIDATION VALUE

LITIGATION LOAN AGREEMENT

LOAN PAYOFF AMOUNT

MARKUP

MERGER

MORTGAGE

An instrument giving legal title to secure the repayment of a loan made by the mortgagee (lender). In legal contemplation there are two types: (1) title theory operates as a transfer of the legal title of the property to the mortgagee, and (2) lien theory - creates a lien upon the property in favor of the mortgagee. The face to face process used by local unions and the employer to exchange their views on those matters involving personnel policies and practices or other matters affecting the working conditions of employees in the unit and reduced to a written binding agreement. Property owned (assets), minus debts and obligations owed (liabilities), is the owner's equity (net worth). Technically defined as "amount of orders placed, contracts awarded, services received, and similar transactions during a given period which will require payments during the same or a future period." Simple interest based on a year of 360 days, contrasting with exact interest having a base year of 365 days. Net disbursements (cash payments in excess of cash receipts) for administrative expenses and for loans and related costs and expenses (e.g., gross disbursements for loans and expenses minus loan repayments, interest and fee income collected, and reimbursements received for services performed for other agencies). A legal relationship existing between two or more persons contractually associated as joint principals in a business. A patent secures to an inventor the exclusive right to make, use, and sell an invention for 17 years. Inventors should contact the U.S. Department of Commerce Patent Office. Interest rate which is charged to business borrowers having the highest credit ratings for short term borrowing. Non-profit, cooperative, and voluntary organizations that are designed to help their members in dealing with problems of mutual interest. A formal document given to customer that outlines proposed work to be done by the business. The most common legal form of business ownership; about 85% of all small businesses are proprietorships. The liability of the owner is unlimited in this form of ownership. Denotes relationships of items within and between financial statements, e.g., current ratio, quick ratio, inventory turnover ratio, and debt/net worth ratios. Solicitations for offerings for competitive negotiated procurements and services.

NEGOTIATION

NET WORTH

OBLIGATIONS

ORDINARY INTEREST

OUTLAYS

PARTNERSHIP

PATENT

PRIME RATE

PROFESSIONAL AND TRADE ASSOCIATIONS PROPOSAL

PROPRIETORSHIP

RATIO

REQUEST FOR PROPOSALS (RFP) RETURN ON INVESTMENT (ROI) SERVICE CORPS OF RETIRED EXECUTIVES (SCORE) SMALL BUSINESS

The amount of profit (return) based on the amount of resources (funds) used to produce it. Also the ability of a given investment to earn a return for its use. Retired and working successful business persons who volunteer to render assistance in counseling, training, and guiding small business clients.

The SBDC is a university-based center for the delivery of joint government, academic,

DEVELOPMENT CENTERS (SBDC)

and private sector services for the benefit of small business and the national welfare. It is committed to the development and productivity of business and the economy in specific geographical regions. A term used to describe the applications that run a computer or data processing system. Turnover is the number of times that an average inventory of goods is sold during a fiscal year or some designated period. When accurately computed, it is one measure of the efficiency of a business. The amount of orders for goods and services outstanding for which the liability has not yet accrued. For practical purposes, represents obligations incurred for which goods have not been delivered or services not performed. Money used to support new or unusual commercial undertakings; equity, risk, or speculative capital. This funding is provided to new or existing firms that exhibit aboveaverage growth rates, a significant potential for market expansion, and the need for additional financing for business maintenance or expansion. A state-mandated form of insurance covering workers injured in job-related accidents. In some states the state is the insurer; in other states insurance must be acquired from commercial insurance firms. Insurance rates are based on a number of factors including salaries, firm history, and risk of occupation.

SOFTWARE

TURNOVER

UNDELIVERED ORDERS

VENTURE CAPITAL

WORKERS' COMPENSATION

Leading vs. Managing

There are countless books on management and leadership. In many instances, the two words are used interchangeably. However, managing and leading are two very different roles. Managers are tasked with doing things right: planning, organizing, and then measuring and making sure things stay on track. Leaders must create a vision, build upon relationships, and inspire others to do their best. What is the difference between leading and managing?

Leaders Innovate Eye the horizons Originate Do the right thing Effective

vs.

Managers Administer Eye the bottom line Imitate Do things right Efficient

Just because you consider yourself a manager does not mean that you do not do the right thing. And just because you consider yourself a leader does not mean you do not keep your eye on the bottom line. Instead, use these traits depending on the situation you find yourself in. Today, owners of small businesses must be able to manage and lead. The best leaders are good managers and the best managers are good leaders. Think of managing as a subset of leading. Managers direct people, projects and divisions. Leaders influence and persuade individuals and teams.

In learning to lead, it is important to study great leaders. For example, in the book, "Lincoln on Leadership," by Donald Phillips, Abraham Lincoln was one of the greatest leaders of all time because he was able to do the following: Get out of the office, and circulate among the troops. Persuade rather than coerce. Honesty and integrity are the best policies. Have the courage to handle unjust criticism. Exercise a strong hand by being decisive. Set goals and be results-oriented. Encourage innovation.

Six Characteristics of Leaders

More recently, Rudolph Guiliani, the former mayor of New York City, gave the following six characteristics of leaders: Strong Beliefs - Leaders need a strong belief system, vision of the future, and an understanding of themselves. Optimism - Who would want to follow someone who said, "Things are terrible and they are going to get worse?" Courage - It isn't that leaders have no fear; it is that they have learned to live with and overcome that fear. Teamwork - Leaders know themselves well enough to know they can't do everything by themselves and so they find others to help them especially in areas where the leader knows he/she is weak or has no knowledge. Good Preparation - Leaders prepare for whatever they do. Whether it is a speech before a group, a court case, rehearing for a possible disaster, leaders prepare thoroughly. Clear Communication - This encompasses all the others. It is not so much choosing the right words as it is having strong beliefs, optimism, courage, etc. These enable you to convey your ideas to others. Study yourself and assess where your strengths and weaknesses are. Then become a good follower by actively engaging in learning how to become a good manager and leader. This process will lead to benefits for you and your business.

27 Basic Business Terms

by NICHOLAS TART on MARCH 18, 2009 2 COMMENTS In order for a young business person to be successful, they have to learn a new set of vocabulary. Certain terms are applicable to all businesses, no matter the size. I have compiled a list of 27 basic business terms all teen businesses should use. Accounting a system that provides quantitative information about finances. Assets the value of everything a company owns and uses to conduct their business. Business an organization that operates with the intention of making a profit. Business to Business (B2B) one business sells goods or services to another business. Business to Consumer (B2C) a business sells goods or services directly to the end user. Contract a formal agreement to do work for pay. Depreciation the degrading value of an asset over time.

Entrepreneur someone who organizes, manages and takes on the risk of starting a new business. Expense money spent on supplies, equipment or other investments. Finance the management and allocation of money and other assets. Fixed Cost a one-time expense that doesnt vary with business volume. Industry a category of like businesses. Liabilities the value of what a business owes to someone else. Management the act of organizing and conducting a business to accomplish goals and objectives. Marketing the process of promoting, selling and distributing a product or service. Net Income/Profit revenues minus expenses. Net Worth the total value of a business. Payback Period the amount of time it takes to recover the initial investment of a business. Product something produced or manufactured to be sold; a good. Profit Margin the ratio of profit divided by revenue displayed as a percentage. Return on Investment (ROI) how much money a business gets in return from an investment. Revenue the entire amount of income before expenses are subtracted. Sales Prospect a potential customer. Service work done for pay that benefits another. Supplier an organization that provides supplies to a business. Target Market a specific group of customers at which a company aims its products and services. Variable Cost expenses that change in proportion to the activity of a business. Bailout The financial rescue of a struggling borrower. A bailout can be achieved in various ways: providing loans to a borrower that markets will no longer lend to guaranteeing a borrower's debts guaranteeing the value of a borrower's risky assets providing help to absorb potential losses, such as in a bank recapitalisation
BRIC An acronym used to describe the fast-growing economies of Brazil, Russia, India and China.

Inflation The upward price movement of goods and services. Liquidation A process in which assets are sold off for cash. Liquidation is often the outcome for a company deemed irretrievably loss-making. In that case, its assets are sold off individually, and the cash proceeds are used to repay its lenders. In liquidation, a company's lenders and other claimants are given an order of priority. Usually the tax authorities are the first to be paid, while the company's shareholders are the last, typically receiving nothing.

Liquidity How easy something is to convert into cash. Your current account, for example, is more liquid than your house. If you needed to sell your house quickly to pay bills you would have to drop the price substantially to get a sale. Stimulus Monetary policy or fiscal policy aimed at encouraging higher growth and/or inflation. This can include interest rate cuts, quantitative easing, tax cuts and spending increases. Recession A period of negative economic growth. In most parts of the world a recession is technically defined as two consecutive quarters of negative growth - when economic output falls. In the United States, a larger number of factors are taken into account, such as job creation and manufacturing activity. However, this means that a US recession can usually only be defined when it is already over. Deficit The amount by which spending exceeds income over the course of a year. In the case of trade, it refers to exports minus imports. In the case of the government budget, it equals the amount the government needs to borrow during the year to fund its spending. The government's "primary" deficit means the amount it needs to borrow to cover general government expenditure, excluding interest payments on debts. The primary deficit therefore indicates whether a government will run out of cash if it is no longer able to borrow and decides to stop repaying its debts. Deflation Negative inflation - that is, when the prices of goods and services across the whole economy are falling on average. Eurozone The 17 countries that share the euro. G7 The group of seven major industrialised economies, comprising the US, UK, France, Germany, Italy, Canada and Japan. G8 The G7 plus Russia. G20 The G8 plus developing countries that play an important role in the global economy, such as China, India, Brazil and Saudi Arabia. It gained in significance after leaders agreed how to tackle the 2008-09 financial crisis and recession at G20 gatherings. GDP Gross domestic product. A measure of economic activity in a country, namely of all the services and goods produced in a year. There are three main ways of calculating GDP - through output, through income and through expenditure.

Hedge fund A private investment fund which uses a range of sophisticated strategies to maximise returns including hedging, leveraging and derivatives trading. Authorities around the world are working on ways to regulate them. Hedging Making an investment to reduce the risk of price fluctuations to the value of an asset. Airlines often hedge against rising oil prices by agreeing in advance to to buy their fuel at a set price. In this case, a rise in price would not harm them - but nor would they benefit from any falls. Assets Things that provide income or some other value to their owner.

Fixed assets (also known as long-term assets) are things that have a useful life of more than one year, for example buildings and machinery; there are also intangible fixed assets, like the good reputation of a company or brand. Current assets are the things that can easily be turned into cash and are expected to be sold or used up in the near future. Austerity Economic policy aimed at reducing a government's deficit (or borrowing). Austerity can be achieved through increases in government revenues - primarily via tax rises - and/or a reduction in government spending or future spending commitments. Bailout The financial rescue of a struggling borrower. A bailout can be achieved in various ways: providing loans to a borrower that markets will no longer lend to guaranteeing a borrower's debts guaranteeing the value of a borrower's risky assets providing help to absorb potential losses, such as in a bank recapitalisation Credit crunch A situation where banks and other lenders all cut back their lending at the same time, because of widespread fears about the ability of borrowers to repay. If heavily-indebted borrowers are cut off from new lending, they may find it impossible to repay existing debts. Reduced lending also slows down economic growth, which also makes it harder for all businesses to repay their debts. surplus adj. Being more than or in excess of what is needed or required: surplus grain. See Synonyms at superfluous. n. 1. An amount or a quantity in excess of what is needed. 2. Accounting a. Total assets minus the sum of all liabilities. b. Excess of a corporation's net assets over the face value of its capital stock. c. Excess of receipts over expenditures. surpass (s r-p s ) (sr pl s, -pl s )

tr.v. surpassed, surpassing, surpasses 1. To be beyond the limit, powers, or capacity of; transcend: misery that surpasses comprehension. 2. To be or go beyond, as in degree or quality; exceed. See Synonyms at excel.

deficit n. 1.

(d f -s t)

a. Inadequacy or insufficiency: a deficit in grain production. b. A deficiency or impairment in mental or physical functioning. c. An unfavorable condition or position; a disadvantage: rallied from a three-game deficit to win the playoffs. 2. a. The amount by which a sum of money falls short of the required or expected amount; a shortage: large budget deficits. b. A business loss.

Tech Uni : Sri Lanka university deal to CATIC Unusual Move : Sri Lanka Marxists oppose expropriation law in historic move Union Status : Sri Lanka's Union Bank profits higher New Model : Sri Lanka bank tax savings mooted to help revive tea industry Debt Swap : Sri Lanka trying to swap Chinese infrastructure loans to equity: minister Group Result : Sri Lanka JKH Sept net boosted by bunkering, hotels Wellness Wealth : Sri Lanka Nestl unit Sept net up 34-pct Trading Thursday : Sri Lanka stocks end down 0.9-pct Taking Over : Sri Lanka govt defends nationalisation bid State Business : Sri Lanka state entities making losses; ruined by political meddling: report Merger Watch : Sri Lanka Merchant Credit on rating watch pending merger Share Issue : Sri Lanka leasing IPO oversubscribed on opening day State Business2 Comment(s)
03 Nov, 2011 14:30:17

Sri Lanka state entities making losses; ruined by political meddling: report Nov 03, 2011 (LBO) - Sri Lanka's state entities have been badly hit by the appointment of unqualified persons to top positions and while annual accounts were not available for some, a media report said. "The appointment of unqualified people to top management posts on political grounds and the lack of financial and administrative disciplines had ruined many of the public enterprises," Sri Lanka's Daily Mirror newspaper quoted minister D E W Gunasekara as saying.

"One of our strong recommendations will be to appoint educated and professionally qualified people to the top management at these institutions." No Accounts Minister Gunasekara chairs a parliamentary committee on public enterprises (COPE) which has examined 249 entities. There were 19 billion rupees in losses in key institutions Losses were in Ceylon Electricity Board (CEB), Ceylon Petroleum Corporation (CPC), Sri Lanka Cricket (SLC), the State Timber Corporation (STC), Sri Lanka Rupavahini Corporation, Lankaputhra Bank and Mihin Lanka among others, the newspaper said. Some entities had not presented accounts for two or three years. "We expect to make a few recommendations to prevent or minimise losses at public enterprises and a series of guidelines on financial and administrative guidelines," the minister was quoted as saying. "The presentation of the annual report before the second half of the following year will be mandatory for all public enterprises from next year." However there are already regulations to cover both state departments and enterprises. Not Cricket The public enterprise department of the Treasury in an earlier report said many state entities were flouting existing regulations. An earlier report in the same newspaper this week said a former mayor of Kandy who had been convicted of misappropriating 1.9 million rupees had been given a presidential pardon. The newspaper said Sri Lanka Cricket, which administers the sport in the island, had lost 2.0 billion rupees and audit queries were not answered. Current Sri Lanka Cricket officials who were summoned to COPE "had no clue as to how payments had been made for foreign trips by top SLC officials, misappropriations of Cricket World Cup funds and of the many contracts," the newspaper said.

Share Issue1 Comment(s)

03 Nov, 2011 12:36:39

Sri Lanka leasing IPO oversubscribed on opening day Nov 03, 2011 (LBO) - A 70 million US dollar initial public offer of shares by Sri Lanka's People's Leasing Company was oversubscribed on the opening day Thursday itself and would close in the afternoon, a stock exchange filing said. People's Leasing Co., the island's largest leasing company, offered 390 million shares at 18 rupees a share. PLC is a fully owned unit of state-run People's Bank and the IPO was expected to attract foreign interest.

Tech Uni1 Comment(s)

04 Nov, 2011 09:02:52

Sri Lanka university deal to CATIC Nov 04, 2011 (LBO) - Sri Lanka has given an 89.55 million deal to build a technology school to China National Aero Technology Import and Export Corporation (CATIC) after larger hotel deal was cancelled over land sale dispute. CATIC was given the contract to re-located the Institute of Technology of Sri Lanka's Moratuwa University to Homagama, another area a little of the capital Colombo. Information minister Keheliya Rambukwelle had said the deal was not related to the cancellation of a 500 million dollar hotel project in Colombo's Galle Face seafront. The deal was cancelled after President Mahinda Rajapaksa ordered an outright sale of land to be made into a lease. The opposition has also protested the deal saying it was done without tendering.

LBO>>Economy

Debt Swap3 Comment(s)

03 Nov, 2011 18:35:48

Sri Lanka trying to swap Chinese infrastructure loans to equity: minister Nov 03, 2011 (LBO) - Sri Lanka wants to swap debt to equity at some of its Chinese funded projects to reduce repayment pressure in the future, minister for international monetary co-operation Sarath Amunugama said. Sri Lanka is in talks with China to swap the debt taken to build a coal power plant in Norochcholai in Northwest Sri Lanka, he told a forum on taxation organized by Sri Lanka's Institute of Policy Studies. "We are trying to negotiate it, starting with the Norochcholai project but move to others also," he said. "If we can convert many of these loans to equity we will not only have financial benefit but also better management," The first 300 MegaWatt stage of the Norochcholai plant was built with 455 million dollars. The second stage of 600MW is financed with an 891 million dollar loan. He said another coal plant built with India's NTPC is already structured as a joint venture with equity partnership. Sri Lanka has taken Chinese loans to build port, road and airport infrastructure. Many of the loans are from Exim Bank of China. LBO>>Companies and Markets

Trading Thursday4 Comment(s)

03 Nov, 2011 15:34:37

Sri Lanka stocks end down 0.9-pct Nov 03, 2011 (LBO) - Sri Lankan stocks slumped Thursday, a day after being pushed up almost three percent on news a regulator who had been cracking down on fraud had been removed, brokers said. The main All Share Price Index fell 0.85 percent (55.09 points) to 6,397.19, while the more liquid Milanka index fell 0.62 percent (35.57 points) to close at 5,707.98, according to stock exchange figures. Turnover fell to 882 million rupees. An initial public offer by People's Leasing Company to raise 70 million US dollars was oversubscribed on the opening day and closed in the afternoon, a stock exchange filing said. People's Leasing Co., the island's largest leasing company, offered 390 million shares at 18 rupees a share. HVA Foods was the most actively traded stock, closing at 44.40 rupees, down 2.60 rupees, with 3.15 million shares changing hands. Colombo Land & Development Company was also heavily traded, closing at 59.70 rupees, down 2.80 with 1.58 million shares done. Hayleys closed at 380.30 rupees, down 7.50, with 37,700 shares traded. John Keells Holdings closed flat at 195 rupees with 462,600 shares traded, including a crossing or off-market private deal of 358,400 shares at 197 rupees each. There was also a crossing of Ceylon Hotels Corporation of 750,000 shares at 32 rupees each. It closed at 31.60 rupees, down 20 cents. Infrastructure Developers, the top gainer, closed at 197.10 rupees, up 65.10 rupees, with 98,300 shares done. The Bukit Darah, an index heavyweight, lost half its gains of the previous day, closing at 1,060 rupees, down 28.60 rupees with 2,400 shares traded. Colombo Pharmacy, another illiquid share, closed at 1,273.70 rupees, down 26.40 with 400 shares traded. Diesel & Motor Engineering closed at 1,310.20 rupees, down 19.40 rupees.

SC Securities said more foreign buying was needed for the market to recover from its slide. "The market could continue to look bearish, with a possibility of the ASPI dropping further," SC Securities said in its weekly review up to Wednesday. "However, a sporadic upside in the market is a possibility albeit with low sustainability, which may lead to a more volatile situation in the market during the next five days. "We believe, the growth in indices and healthy activity levels will be sustainable only if confidence and vitality is provided by way of foreign investments, governmental and private institutional buying, the brokeage said. The market gained sharply Wednesday after steady slide of several weeks with news that Malik Cader, director general of the securities and exchange commission, had been made an advisor of the finance ministry, a move that had been widely speculated upon. Cader had angered powerful players in the market for cracking down on widespread micro cap fraud and insider dealing that is said to be rife on the Colombo bourse. Services
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Euro Fix
04 Nov, 2011 06:31:23

G20 partners warn Europe to fix debt crisis CANNES, November 3, 2011 (AFP) - Leaders of the world's top economies urged Europe to put its house in order Thursday as a G20 summit supposed to be about boosting fragile global growth was hijacked by the eurozone debt crisis. US President Barack Obama, at the opening of the two-day Group of 20 summit, said the leaders' top priority was to conquer the European crisis, which has rocked markets and threatens to drag the world economy into recession. "The most important aspect of our task is to resolve the financial crisis here in Europe," said Obama after meeting summit host French President Nicolas Sarkozy at the start of the two day meeting in Cannes. Japanese Prime Minister Yoshihiko Noda warned the crisis risks provoking a "chain reaction" through the global economy, with Italy now in the danger zone as the threat of Greece being forced from the eurozone mounted. European leaders and Obama held a mini summit late Thursday to discuss the eurozone crisis. "We have other problems to deal with and will address them after the dinner," said the French leader. "It is essential that the eurozone sends a message to the entire world stressing its credibility," he added. Already on Wednesday, France and Germany had tried to strong-arm Athens into accepting an EU bailout package as the Greek government tottered on the brink of collapse after Prime Minister George Papandreou reignited market turmoil by saying Athens would put the rescue package agreed only last week to a referendum. G20 host Sarkozy and his German counterpart Chancellor Angela Merkel summoned Papandreou to Cannes to vent their fury over his high-risk referendum gambit. They warned Greece would not receive "one more cent" of the International Monetary Fund and EU's next planned eight-billion euro ($11 billion) aid installment unless he won the referendum scheduled for December 4. Without the EU-IMF funds, Greece will run out of money within weeks and could face a messy debt default which would force it to leave the European single currency bloc. Nervous investors sent Italy's long-term borrowing costs to 6.4 percent, nearing levels unsustainable over the long-term. Stock markets tumbled before being boosted by an unexpected rate cut by the European Central Bank. The warning seemed to work and Papandreou -- back in Athens Thursday and facing a confidence vote in parliament -- said he was prepared to drop plans for the referendum which had sent world markets into a tailspin. However, Merkel kept up the pressure, reiterating the warning it would receive no funds until it approves the rescue package.

"For us, it's actions that count," Merkel said . "What's important is that there is a quick 'Yes' to the October 27 decisions." EU leaders also put the onus on Greece to stick to the terms of the planned bailout package. "The euro area stands ready to continue to support Greece but Greece needs to stick to the agreed package ... This needs to be crystal clear," EU President Herman Van Rompuy and European Commission chief Jose Manuel Barroso said. Russian President Dmitry Medvedev, meanwhile, urged Greece to take urgent measures that are "not exotic or populist" to resolve its debt crisis, warning: "Countries with excessive debt must urgently begin fiscal consolidation. "Russia is part of Europe and its problems concern us. We will participate in financial aid programmes in EU countries, at least through the IMF," he said. Britain and Australia also promoted IMF involvement, and a source close to the negotiations said leaders were planning to boost the body's funding base from next year. China, whose President Hu Jintao dined with Sarkozy late Wednesday, dangled the possibility of contributing $100 billion to Europe's bailout fund, but only if they were convinced the investment was safe. Chinese Commerce Minister Chen Deming warned "the future impact of this crisis for the world and for Chinese trade will expand," although he expressed confidence Europe would gradually get on top of the problem. The new IMF measure will be included in the final G20 communique Friday, the source said, along with a package of measures to boost growth. According to a draft of a growth action plan likely to be adopted by the G20 leaders, the world's most successful exporters, led by China and Germany, will take new measures to boost domestic consumer demand. The G20 countries also pledge greater exchange rate flexibility, a bitter issue as the United States and Brazil in particular accuse China of keeping its exchange rate artificially low, skewing global trade.