Noncompetitive bids are a method for smaller investors to purchase U.S. Treasury bills. These bids are submitted through a Federal Reserve Bank, the Bureau of the Public Debt, or certain commercial banks, and are executed at the average price of all accepted competitive bids.
A nonconforming loan is a type of home mortgage loan that does not meet the standards of, or is too large to be purchased by, the Federal National Mortgage Association (FNMA) or the Federal Home Loan Mortgage Corporation (FHLMC). Due to this, the interest rates on these loans are typically higher.
Nonconforming use refers to the utilization of land that lawfully existed prior to the enactment of a new zoning ordinance and can be maintained even after the ordinance's effective date, even though it no longer complies with the new use restrictions applicable to the area.
A provision in an insurance policy that precludes the insurer from disputing the validity of the policy on the basis of fraud or mistake after a specified period, typically two years.
A noncontributory qualified pension or profit-sharing plan (NQP/PSP) is a retirement plan entirely funded by the employer, with no contributions required from the employees. These plans are established for the employees' benefit, ensuring financial security upon retirement.
A noncurrent asset is an asset that is not expected to be converted into cash, sold, or exchanged within the normal operating cycle of the firm, usually one year. Examples include fixed assets such as real estate, machinery, and other equipment.
A nondisclosure agreement (NDA) is a legally binding contract that establishes a confidential relationship between parties to protect sensitive information from being disclosed to unauthorized third parties.
A nondiscretionary trust, also known as a fixed investment trust, is an investment trust that may only invest in specific securities pre-determined by its organizing documents. The percentage of total assets that may be invested in a specific security or type of securities is usually predetermined.
A nondisturbance clause is a contractual provision that ensures the continuation of rental or lease agreements, or surface development rights, despite certain legal or financial disruptions.
Goods that do not last a long time, are quickly consumed, and so must continually be replaced by consumers. Food is the most prevalent example of nondurable goods.
A nonexclusive listing is a type of real estate agreement in which a property owner allows multiple brokers to market the property. This arrangement contrasts with an exclusive listing where one broker is given the sole right to market and sell the property.
Nonfeasance refers to the failure to perform a duty or responsibility to which one is legally bound, such as an unfulfilled contractual duty.
In the context of pension or profit-sharing plans, nonforfeitable benefits are those that are guaranteed and not conditioned upon further length of service or performance requirements.
Definition and explanation of the nonforfeiture provision in life insurance policies, which allows the insured to access certain values and benefits even if they stop paying premiums.
A bank that is not a member of the Federal Reserve System and is regulated by the banking laws in the state in which it is chartered.
A nonmember firm is a brokerage firm that does not hold membership in an organized exchange. These firms execute trades through member firms, on regional exchanges, or in the third market.
A Nonmerchantable Title, also known as a dysfunctional or defective title, refers to a property title with significant defects or encumbrances that prevent its clear transfer from one owner to another. These defects can significantly lower the property's market value and complicate transactions.
A nonmonetary item is an asset, liability, or other financial statement line item that is stated in historical dollars and requires adjustment for inflation or deflation. Such items are not categorized as monetary items and thus do not maintain a fixed monetary value over time.
A nonnegotiable instrument is a financial document that cannot be transferred or assigned to another party. Unlike negotiable instruments, nonnegotiable instruments are not easily transferable and often carry a specific notation indicating their non-negotiability.
Nonoperating expenses (or revenues) refer to the financial transactions that are incidental to a business's core operations. They typically arise from activities that are secondary to the main business functions.
Nonparametric statistics refers to statistical methods that do not assume a specific population distribution and are based on distribution-free procedures. These methods are useful when data do not meet the assumptions required for parametric tests.
Nonperformance refers to the failure to do something that one was legally bound to do. The nonperforming party is liable for damages or actions requiring specific performance.
A nonperforming asset (NPA) is a classification used by financial institutions for loans or advances that are in default or are in arrears on scheduled payments of principal or interest. These assets are not effectual in producing income and thus pose a risk to the financial health of lending institutions.
Nonproductive activities or assets do not contribute to the production of the desired goods or realization of the expected effects, often resulting in wasted effort and financial resources.
Nonprofit accounting encompasses the accounting policies, procedures, and techniques employed by nonprofit organizations. It is different for governmental units compared to nongovernmental units such as colleges, hospitals, voluntary health and welfare organizations, and charities.
A nonprofit corporation is an organization legally constituted and operated to serve a public or mutual benefit, rather than to pursue or distribute profits to its directors, members, or shareholders.
An entity that operates for purposes other than generating profit and is exempt from paying income taxes due to its socially desirable business activities.
Nonpublic information refers to any material data about a company, both positive and negative, that has not been made public and may significantly affect stock prices. Insiders are prohibited from trading on such information until it is publicly released.
A nonrecognition transaction refers to any disposition of property in which the gain or loss is not recognized in whole or part under tax laws, like a like-kind exchange.
Nonrecourse debt is a type of debt secured by collateral, typically real estate, where the lender's recourse in case of default is limited to the collateral, and the borrower has no personal liability beyond the collateral.
A nonrecurring charge is a one-time expense or write-off that appears in a company's financial statement. It is also called an extraordinary charge. This term includes unexpected events such as natural disasters, strategic business decisions like closing a division, or changes in accounting procedures.
Understanding the nonrefundable provision in bond indentures and how it impacts bondholders and issuers.
A nonrefundable fee or deposit refers to a charge for a product or service that will not be refunded if the product is returned or service declined. It often acts as a penalty charge where individuals frequently back out of commitments, ensuring a level of commitment from the client or customer.
Nonrenewable natural resources are resources that cannot be replenished once they are exhausted. Examples include fossil fuels like oil, coal, and natural gas.
A nonresident alien is an individual who is not a lawful permanent resident of the United States during the calendar year and does not meet the requirements of the substantial presence test, nor elects to be treated as a resident alien.
Nonstandard mail refers to first-class or single-piece third-class mail that weighs less than one ounce but exceeds established dimensions. Such mail incurs an additional charge.
A nonstock corporation is a type of corporation owned by its members under a membership charter or agreement, rather than through the issuance of shares.
Retailing done without conventional store-based locations. Nonstore retailing includes services such as internet retailing, vending machines, direct-to-home selling, telemarketing, catalog sales, mail order, and television marketing programs.
A situation where an account does not have enough funds to cover a transaction, such as a presented check. This often results in the check being dishonored by the bank.
Nontaxable dividends are dividends from a regulated investment company (mutual fund) that were earned by the fund as interest from tax-exempt state and municipal debt obligations and other exempt obligations. For dividends to be tax-free, at least 50% of the regulated investment company's assets must be invested in tax-exempt obligations.
Nontaxable interest refers to interest income derived from certain sources that is excluded from federal taxable income, such as interest on state and municipal debt obligations.
Nonverbal communication refers to the ways we convey information without the use of spoken or written words. It includes body language, gestures, facial expressions, posture, and other physical behaviors that can communicate meaning.
Corporate securities that do not empower a holder to vote on corporate resolutions or the election of directors. Commonly issued during takeovers to dilute equity and discourage mergers.
A norm represents a rule or standard that is considered acceptable behavior within a group or society and, in psychology, refers to the average standard of achievement on a test for a selected group.
Normal capacity is a measure of production that reflects the average level of operating activity needed to meet production demands over a long period. It considers both seasonal fluctuations and normal occurrences of idle time.
Normal cost represents the portion of the economic cost of a participant's anticipated pension benefits allocated to the current plan year, usually distinct from accounting accrual cost or the cash outlay required in that year.
Normal distribution, in statistics, is a continuous probability distribution that is perfectly symmetrical around the mean, signifying that data near the mean are more frequent in occurrence than data far from the mean. It is completely defined by its mean and standard deviation.
A normal good is a type of good for which demand increases as consumer income increases, holding all other factors constant. This inverse relationship between income and demand exemplifies how purchasing power influences consumer behavior.
Normal loss refers to the predictable and usual loss of materials in a manufacturing or chemical process due to factors like waste, seepage, shrinkage, or spoilage. These losses are considered a standard part of the production process and are accounted for in manufacturing costs.
The normal operating cycle is the period required to convert cash into raw materials, raw materials into inventory finished goods, finished goods inventory into sales and accounts receivable, and finally, accounts receivable back into cash.
The normal price refers to the price level that goods or services typically command in a market over the long term. It is a stable price expectation absent extraordinary market fluctuations like sudden shortages or surpluses.
Normal profit is the minimum level of income needed for a business to remain competitive in an industry over the long term. It represents the point at which total revenue equals total cost, including explicit and implicit costs.
The earliest age at which an employee can retire without a penalty reduction in pension benefits, typically after meeting minimum age and service requirements. Historically, set at 65 years but varies by pension plans.
In accounting, a normal standard represents an average standard that is used in standard costing. It is set to be applied over a future period during which conditions are expected to remain relatively stable.
Normal Volume refers to the volume of activity used to determine the overhead absorption rate in a system of absorption costing. It is generally the budgeted volume of production for a specific period.
Normal wear and tear refer to the physical depreciation arising from the age and ordinary use of a property. Understanding this concept is critical in fields such as accounting, real estate, and property management.
Normative economics is a branch of economics that discusses what the economic goals and policies of society should be, often reflecting personal values or opinions. It contrasts with positive economics, which aims to understand how the economy operates.
Normative theories of accounting prescribe the accounting procedures and policies that should be followed, often based on a priori concepts and deductive reasoning, as opposed to those that are actually followed in practice.
The North American Free Trade Agreement (NAFTA) was a trilateral trade agreement between Canada, Mexico, and the United States aimed at reducing trade barriers and promoting economic growth. It was replaced by the United States-Mexico-Canada Agreement (USMCA) in 2020.
The North American Free Trade Agreement (NAFTA) is a trade deal that dramatically impacts trade, investment, and social standards among the United States, Mexico, and Canada by eliminating tariffs and quotas on most goods exchanged among these countries.
The North American Industry Classification System (NAICS) is a system for classifying business activities developed jointly by the United States, Canada, and Mexico, using six-digit codes. It replaces the U.S. Standard Industrial Classification (SIC) System.
The term 'Not Negotiable' is used in the context of bills of exchange, indicating that the instrument is no longer a negotiable instrument. This term provides a safeguard against passing on a defective title.
The term 'Not Rated (NR)' is an indication used by securities rating services like Standard & Poor's (S&P) and Moody's, as well as mercantile agencies such as Dun & Bradstreet, to show that a security or a company has not been rated. This designation carries neither positive nor negative implications.
A Not-For-Profit Organization, also known as a nonprofit, is an organization in which no stockholder or trustee shares in profits or losses. These organizations usually exist to accomplish charitable, humanitarian, or educational purposes.
A not-for-profit organization (NFP) is an entity formed for purposes other than generating a profit and where no part of the organization's income is distributed to its members, directors, or officers.
An organization that provides goods or services with a policy that no individual or group will share in any profits; where a surplus is generated, this must be used to further the goals of the organization. Examples are charities, political organizations, housing associations, and educational institutions.
Notarization is the official fraud-deterrent process performed by notaries public to ensure the genuineness of signatures on documents.
A notary public is a public officer authorized to administer oaths, attest to and certify documents, take depositions, and perform certain acts in commercial matters. The seal of a notary public authenticates a document.
A Note Issuance Facility (NIF) is a type of credit arrangement that allows for the issuance of short- to medium-term notes in the Eurocurrency market. It provides borrowers with the ability to secure short-term debt funding on a continuous or revolving basis.
A Note Issuance Facility (NIF) is a financial arrangement that enables short-term borrowers in the eurocurrency markets to issue euronotes with maturities of less than one year on a rolling basis. This facility provides an efficient, flexible way to manage short-term funding needs without the need for separate borrowing arrangements each time funds are required.
A Note Receivable is a financial instrument representing a written promise from a debtor to pay a specified sum of money to the creditor at a future date or on demand.
A note or note payable is a written document that acknowledges a debt and contains a promise to pay a specified sum to a certain party by a certain date. Maturity terms can be definite or become definite over time.
A notebook computer, also known as a laptop, is a small, lightweight portable computer featuring a back-hinged LCD screen that folds open for viewing. Designed to operate on rechargeable batteries, notebook computers often come with an AC adapter for power.
A notebook computer, often referred to as a laptop, is a small, portable personal computer with a clamshell form factor, suitable for mobile use.
Notes to the accounts, also known as notes to financial statements, provide detailed information and explanations that support and complement a company's financial statements. These notes help users understand and interpret the financial data and the company's overall performance and financial health.
Notice is information concerning a fact actually communicated to a person by an authorized source, or derived from a proper source, usually in the context of legal proceedings.
A Notice of Default is a formal letter sent to a party in default to remind them of their breach of contract, potentially including a grace period to rectify the default and outlining any penalties for failing to cure the default.
A Notice of Deficiency is a formal notice issued by the Internal Revenue Service (IRS) to a taxpayer, outlining the amount of additional tax owed and a summary of how the deficiency was calculated. This notice must be sent to the taxpayer's last known address to be legally valid.
A legal document issued to inform a tenant or landlord of the intention to vacate a rented property. The notice can be initiated by either party, detailing the date by which the property must be vacated.
Novation refers to the cancellation of rights and obligations under one legal agreement and their replacement with new ones under another agreement. This process typically results in a change in the identity of one of the parties involved, such as in loan agreements.
Nuisance refers to any activity or condition that interferes with the usage and enjoyment of property either causing annoyance or damage to others. It is a significant concept in tort law addressing both private and public disturbances.
NUKE is a slang term used in computing to describe the act of intentionally deleting the entire contents of a given directory, hard drive, or other storage device.
The term 'null and void' refers to something that cannot be legally enforced, such as a contract provision that does not conform to the law.
In statistical hypothesis testing, the null hypothesis (H0) is the default or initial statement assumed to be true, often stating that there is no effect or no difference. The null hypothesis is only rejected if the evidence from the data significantly contradicts it.
A 'Number Cruncher' refers to both a person who spends much time calculating and analyzing numerical data as well as a computer specifically designed to perform extensive numerical calculations.
A ratio that measures the average number of days an organization's stock is held before it is sold or used in production.
A numeric keypad is a specific set of keys on a computer keyboard, located beside the main alphabetic keypad, primarily featuring digits 0 to 9 and a decimal point key, arranged similarly to an adding machine for efficient numerical input.
A nuncupative will, also known as an oral will, is a testamentary disposition made verbally in the presence of witnesses, and is seldom valid in most jurisdictions.
The New York Mercantile Exchange (NYMEX) is a commodities futures exchange where various futures and options contracts are traded. It is one of the most recognized and influential exchanges in the world.
NYSE Euronext was a multinational financial services corporation that operated multiple securities exchanges, including the New York Stock Exchange and Euronext. It facilitated global trading and investments, providing market data, listings, and trading services.
The New York Stock Exchange (NYSE) is the largest stock exchange in the world by market capitalization. It provides a platform for buying and selling an extensive range of securities, including stocks, bonds, and other financial instruments.
Economic policies championed by President Barack Obama to achieve economic recovery and effect reforms, calling for increased involvement by the government in the private sector in areas such as health care, banking, automobiles, college education finance, consumer protection, and environmental protection.
Object Linking and Embedding (OLE) is a technology developed by Microsoft that allows embedding and linking to documents and other objects. An example is inserting a drawing created in CorelDRAW into a Microsoft Word document. The OLE object can be embedded as a static copy or linked to reflect changes made to the original drawing. Double-clicking on the drawing in Word opens a CorelDRAW window for editing within Word.
Object Linking and Embedding (OLE) is a technology developed by Microsoft that allows embedding and linking to documents and other objects. It is used to create compound documents, where data from different applications can be included in a single file and edited within the context of the original application.
Object-Oriented Programming (OOP) is a programming paradigm that uses 'objects' to design applications and computer programs. It utilizes several key concepts such as classes, inheritance, encapsulation, and polymorphism to create reusable and modular code.
An objective is a clearly defined and articulated goal or target, free from personal bias or opinion, and representing the ultimate aim of an individual or group's efforts and strategy.
An objective function in linear programming is a mathematical statement that defines the goal of a decision-making problem, often aiming to maximize contribution or minimize costs based on the relationship between production factors.
Objective Value is a term used to describe the value of an asset as determined by market forces, rather than subjective measures like personal opinions or intrinsic valuations.
Understanding the primary goals that financial statements aim to achieve is crucial for determining the scope of information they should provide and the manner in which they should be presented.
Objectivity in accounting aims to minimize subjective actions by preparers of accounts to ensure comparisons of financial statements across different companies are based on consistent principles.
