Communicating with Senior Management To communicate the true value of your T&E management program to senior management in roles such as CEO, CFO, COO, Controller, or Treasurer, you'll need to converse in the language and concepts to which they're accustomed and focused. Below you'll find some basic definitions of key financial terms. If you've come to your travel management role from a financial background, then you will already be quite familiar with many of these terms. However, you should check this section frequently - over the weeks and months ahead we'll supplement this information over the months ahead with further definitions, and depth, with a focus on how your Diners Club program relates to many of these topics, and how you can communicate the value of your program to senior management. Accounts Payable: The amount of money owed to suppliers and vendors, generally due within thirty days. Accounts Receivable: The amount of money owed to a business from its customers, generally within 30 days. Balance Sheet: An overview of a company's assets, liabilities and owners equity at a specific point in time. Basis Point: The smallest measure used in quoting bond yields - .01%. Changes in bond yields are reported in basis points. Break-even: The point at which revenues for a product exactly equal the cost to produce it. This calculation is frequently used to assess wither it is worth producing a product. Capital Assets: Capital consists of property, inventory, cash on hand, accounts receivable and other items of valued owned by a company. Cash Flow: The actual cash in and out of an organization. Organizations may show profits on paper due to the money in Accounts Receivable, but still go bankrupt due to negative Cash Flow. Depreciation: An asset's decline in value due to usage or obsolescence. Earnings per Share: An organization's annual earnings divided by the total number of shares outstanding. Goodwill: The intangible assets of a business that impact its overall value. Such assets might include company reputation, loyal customer base, brand recognition and employee morale. Income Statement: A summary of a company's revenue and expenses for a specified period of time, usually one year. Together with the balance sheet, these two documents make up a company's financial statements. Also known as a profit and loss statement. Liquid: Easily converted into cash. Net Sales: Gross sales minus such costs as cash discounts, shipping charges and inventory returns. Net Worth: An individual's or business' total value of its assets minus all obligations. Operating Income: Income generated from day-today operations of a firm. Paper: Short-term obligations issued for terms of 2 to 270 days. These are usually targeted to investors with a great deal of cash available on a short-term basis. Prime Rate: The interest rate that banks offer to their best commercial customers. Profit Margin: The selling price of an item less all variable costs. Settlement: Completing a transaction by paying all obligations. Time Value of Money: A way of describing the effect of inflation. A dollar received today is worth more than a dollar received at a point in the future. Variable Cost: Production Costs involving raw materials, labor and utilities that vary according to the production quantity.