Financial Accounting Terms with "L"

Glossary of Financial Accounting - Glossario Contabilità Finanziaria

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Leasing: acquiring the use of an asset through a rental agreement.

Legal Form: representing a transaction to reflect its legal status, which might not be the same as its economic form.

Leverage: alternative term for gearing, commonly used in the USA.

Liabilities: obligations of an entity to transfer economic benefits as a result of past transactions or events.

Limited Liability: a phrase used to indicate that those having liability in respect of some amount due may be able to invoke some agreed limit on that liability.

Limited Liability Company: company where the liability of the owners is limited to the amount of capital they have agreed to contribute.

Liquidity: the extent to which a business has access to cash or items which can readily be exchanged for cash.

Listed Company: a company whose shares are listed by the Stock Exchange as being available for buying and selling under the rules and safeguards of the Exchange.

Listing Requirements: rules imposed by the Stock Exchange on companies whose shares are listed for buying and selling.

Listing Rules: issued by the UK Listing Authority of the Financial Services Authority to regulate companies listed on the UK Stock Exchange. Includes rules on accounting information in annual reports.

Loan Covenants: greement made by the company with a lender of long-term finance, protecting the loan by imposing conditions on the company, usually to restrict further borrowing.

Loan Notes: a method of borrowing from commercial institutions such as banks.

Loan Stock: loan finance traded on a Stock Exchange.

Long-Term Finance, Long-Term Liabilities: money lent to a business for a fixed period, giving that business a commitment to pay interest for the period specified and to repay the loan at the end of the period Also called non-current liabilities information in the financial statements should show the commercial substance of the situation.