Accounting Abbreviations
95 abbreviations · part of Business & Finance Abbreviations
Abbreviations from bookkeeping, financial statements, accounting and auditing standards, cost accounting and reporting periods, such as GAAP, IFRS, P&L, EBITDA, COGS, YTD and YoY. Accountants, auditors, analysts and managers use them in ledgers, annual reports, earnings releases and month-end close checklists. Where a term is defined by a standard-setter such as FASB or the IASB, the entry names the relevant standard and notes how US and international practice differ.
| Abbreviation | Stands for | Description |
|---|---|---|
| ABC | Activity-based costing | Cost accounting method that assigns overhead costs to products and services according to the activities they consume, such as machine setups, orders processed or… |
| AFS | Available for sale | US GAAP classification for debt securities that are held neither for trading nor to maturity, measured at fair value with unrealized gains and losses recorded in other… |
| AICPA | American Institute of Certified Public Accountants | National professional organization for certified public accountants in the United States, with more than 400,000 members worldwide. |
| AJE | Adjusting journal entry | Journal entry made at the end of an accounting period to record revenue and expenses in the correct period under accrual accounting, such as accrued wages, prepaid… |
| AOCI | Accumulated other comprehensive income | Component of shareholders' equity that accumulates the period-by-period OCI items not yet recognized in net income, such as unrealized losses on available-for-sale… |
| AP | Accounts payable | Money a company owes to suppliers for goods and services bought on credit, recorded as a current liability on the balance sheet. |
| AR | Accounts receivable | Money owed to a company by customers for goods or services delivered on credit, recorded as a current asset on the balance sheet. |
| ASC | Accounting Standards Codification | Single authoritative source of US GAAP, maintained by the Financial Accounting Standards Board and organized into numbered topics, such as ASC 606 for revenue from… |
| ASU | Accounting Standards Update | Document issued by the Financial Accounting Standards Board to amend the Accounting Standards Codification, numbered by year and sequence, such as ASU 2016-02 on leases. |
| B/S | Balance sheet | Financial statement showing a company's assets, liabilities and shareholders' equity at a specific date, based on the equation assets equal liabilities plus equity. |
| BEP | Break-even point | Level of sales, in units or revenue, at which total revenue equals total costs, so the business makes neither a profit nor a loss. |
| BV | Book value | Value of an asset or company according to its balance sheet: for an asset, cost minus accumulated depreciation; for a company, total assets minus total liabilities… |
| CECL | Current expected credit losses | US GAAP impairment model (ASC 326) that requires lenders and other companies to record an allowance for credit losses expected over the entire life of loans and other… |
| CFS | Cash flow statement | Financial statement showing cash received and paid during a period, divided into operating, investing and financing activities, and reconciling opening and closing cash… |
| CM | Contribution margin | Revenue minus variable costs, either in total or per unit, showing how much each sale contributes to covering fixed costs and then to profit. |
| COA | Chart of accounts | Structured list of all accounts in a company's general ledger, each with a number and name, grouped into assets, liabilities, equity, revenue and expenses. |
| COGM | Cost of goods manufactured | Total production cost of goods completed during a period in a manufacturing company, including direct materials, direct labor and manufacturing overhead, adjusted for… |
| COGS | Cost of goods sold | Direct costs of producing or buying the goods a company sold during a period, including materials, direct labor and manufacturing overhead, but excluding selling and… |
| COS | Cost of sales | Direct costs attributable to producing the goods or services a company sold during a period, used largely interchangeably with cost of goods sold. |
| COSO | Committee of Sponsoring Organizations of the Treadway Commission | Joint initiative of five US professional organizations that develops frameworks on internal control, enterprise risk management and fraud deterrence. |
| Cr | Credit | Entry on the right side of an account in double-entry bookkeeping, which increases liability, equity and revenue accounts and decreases asset and expense accounts. |
| CVP | Cost-volume-profit analysis | Management accounting technique that examines how changes in sales volume, selling price, variable costs and fixed costs affect profit. |
| CY | Calendar year | The January-to-December year, written out in budgeting, tax and insurance documents to distinguish it from a fiscal year or plan year. |
| D&A | Depreciation and amortization | Non-cash expenses that spread the cost of long-lived assets over their useful lives: depreciation for tangible assets such as machinery and buildings, amortization for… |
| Dr | Debit | Entry on the left side of an account in double-entry bookkeeping, which increases asset and expense accounts and decreases liability, equity and revenue accounts. |
| DTA | Deferred tax asset | Balance sheet asset representing taxes a company expects to save in future periods, arising from deductible temporary differences, tax loss carryforwards or unused tax… |
| DTL | Deferred tax liability | Balance sheet liability for income taxes that will be payable in future periods because of taxable temporary differences, such as when tax depreciation runs ahead of… |
| EBIT | Earnings before interest and taxes | Measure of a company's operating profit, calculated as net income plus interest expense and income taxes, or as revenue minus operating expenses. |
| EBITDA | Earnings before interest, taxes, depreciation and amortization | Profit measure that adds depreciation and amortization back to EBIT, approximating cash earnings from operations before financing costs, taxes and capital spending. |
| EBITDAR | Earnings before interest, taxes, depreciation, amortization and rent (or restructuring) | Variant of EBITDA that also adds back rent or lease costs, used to compare companies that own their assets with those that lease them, especially airlines, retailers… |
| EBT | Earnings before taxes | Profit after all operating expenses and interest but before income tax expense, shown as "income before income taxes" on many US income statements. |
| EPS | Earnings per share | Company's net income attributable to common shareholders divided by the weighted average number of common shares outstanding, showing profit on a per-share basis. |
| FASB | Financial Accounting Standards Board | Independent private-sector body that establishes US GAAP for public companies, private companies and nonprofit organizations, recognized by the SEC as the designated… |
| FIFO | First in, first out | Inventory costing method that assumes the oldest units purchased or produced are sold first, so cost of goods sold reflects older costs and ending inventory reflects… |
| FRS | Financial Reporting Standard | Accounting standard issued in the UK and Ireland by the Financial Reporting Council (FRC); together these standards form UK GAAP for companies that do not use IFRS. |
| FV | Fair value | Price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. |
| FY | Fiscal year | The 12-month accounting period a government or company uses for budgets and financial reports, which need not match the calendar year. |
| FYE | Fiscal year-end | Last day of a company's fiscal year, when the books are closed, annual financial statements are prepared and the external audit focuses. |
| G&A | General and administrative expenses | Overhead costs of running a business that are not directly related to producing or selling products, such as executive pay, finance, legal, HR, office rent, insurance… |
| GAAP | Generally accepted accounting principles | Framework of accounting standards, rules and conventions that companies follow when preparing financial statements; in the United States, US GAAP is set by the… |
| GAAS | Generally accepted auditing standards | Standards that auditors in the United States follow when auditing financial statements, covering the auditor's qualifications, how audit work is performed and how… |
| GASB | Governmental Accounting Standards Board | Independent organization that sets accounting and financial reporting standards for US state and local governments, such as cities, counties, school districts and… |
| GL | General ledger | Master set of accounts in which all of a company's financial transactions are recorded, organized by the chart of accounts and summarizing activity from subledgers such… |
| GM | Gross margin | Gross profit expressed as a percentage of revenue, showing the share of each sales dollar left after paying direct production costs. |
| GP | Gross profit | Revenue minus cost of goods sold, showing how much money a company makes from its products or services before operating expenses, interest and taxes. |
| GRN | Goods received note | Document prepared when goods arrive from a supplier, recording what was delivered, the quantities and condition, and checked against the purchase order. |
| H1 | First half | First six months of a fiscal or calendar year, January through June for calendar-year companies. |
| H2 | Second half | Last six months of a fiscal or calendar year, July through December for calendar-year companies. |
| HTM | Held to maturity | US GAAP classification for debt securities a company has the positive intent and ability to hold until maturity, carried at amortized cost rather than fair value. |
| IAS | International Accounting Standards | Accounting standards issued by the International Accounting Standards Committee between 1973 and 2001 and adopted by its successor, the IASB, many of which remain in… |
| IASB | International Accounting Standards Board | Independent body based in London that develops and issues IFRS Accounting Standards, used by companies in most countries outside the United States. |
| ICFR | Internal control over financial reporting | Processes and controls designed to provide reasonable assurance that a company's financial statements are reliable and prepared according to GAAP, such as approvals… |
| IFRS | International Financial Reporting Standards | Global set of accounting standards issued by the International Accounting Standards Board (IASB) and required or permitted for listed companies in more than 140… |
| IPSAS | International Public Sector Accounting Standards | Accrual-based accounting standards for governments and public-sector entities, issued by the International Public Sector Accounting Standards Board (IPSASB) and largely… |
| JE | Journal entry | Record of a business transaction in the accounting system, listing the accounts debited and credited, the amounts, the date and a description. |
| LCM | Lower of cost or market | US inventory valuation rule requiring inventory to be reported at the lower of historical cost or market value, where market is replacement cost bounded by a ceiling… |
| LIFO | Last in, first out | Inventory costing method that assumes the most recently acquired units are sold first, so cost of goods sold reflects the latest prices. |
| MD&A | Management's discussion and analysis | Section of a public company's annual and quarterly reports in which management explains results of operations, liquidity, capital resources, trends and known… |
| MoM | Month over month | Percentage change in a figure compared with the previous month, used for fast-moving metrics such as website traffic, subscription sales, retail sales and inflation. |
| MTD | Month to date | Cumulative figure from the first day of the current month up to today, used in sales dashboards, budgets, payroll and investment performance reports. |
| MTM | Mark-to-market | Practice of valuing assets and liabilities at current market prices rather than historical cost, so gains and losses are recognized as prices change. |
| NBV | Net book value | Carrying amount of an asset on the balance sheet, equal to its original cost minus accumulated depreciation, amortization and impairment. |
| NCI | Non-controlling interest | Portion of a subsidiary's equity not owned by the parent company, reported within equity on the consolidated balance sheet. |
| NI | Net income | Bottom-line profit after all expenses, interest, taxes and other items, often called net earnings or simply "the bottom line." It is the starting point of the indirect… |
| NRV | Net realizable value | Estimated selling price of inventory or receivables in the ordinary course of business, minus the costs to complete and sell them. |
| OCI | Other comprehensive income | Gains and losses that bypass net income and are recorded directly in equity, such as foreign currency translation adjustments, certain pension remeasurements… |
| P&L | Profit and loss statement | Financial statement summarizing revenue, costs and expenses over a period, such as a quarter or year, to show whether a business made a profit or a loss. |
| PAT | Profit after tax | Net profit remaining after all expenses, interest and income tax have been deducted, available for dividends or retention. |
| PBT | Profit before tax | Profit a company earns after all expenses, including interest, but before corporate income tax. |
| PCAOB | Public Company Accounting Oversight Board | Nonprofit corporation created by the Sarbanes-Oxley Act of 2002 to oversee the audits of public companies and SEC-registered broker-dealers in the United States. |
| PO | Purchase order | Document a buyer issues to a supplier authorizing a purchase and specifying items, quantities, prices, delivery terms and payment terms. |
| PP&E | Property, plant and equipment | Long-term tangible assets used in operations rather than held for sale, such as land, buildings, machinery, vehicles, computers and furniture. |
| PPA | Purchase price allocation | Process of assigning the price paid in an acquisition to the fair values of the identifiable assets acquired and liabilities assumed, with any excess recorded as… |
| PY | Prior year | Previous fiscal or reporting year, used in financial statements, audit working papers and variance analysis to compare current results with the year before. |
| Q1 | First quarter | The first three months of a year: January through March for calendar-year companies. |
| Q2 | Second quarter | April through June in a calendar year, ending at the midpoint of the year. |
| Q3 | Third quarter | July through September in a calendar year. |
| Q4 | Fourth quarter | October through December in a calendar year, the final quarter and, for retailers, the most important, because it contains Black Friday, Cyber Monday and the holiday… |
| QoQ | Quarter over quarter | Comparison of a figure with the immediately preceding quarter, such as third-quarter sales against second-quarter sales, expressed as a percentage change. |
| QTD | Quarter to date | Cumulative figure from the start of the current quarter, calendar or fiscal, up to today, used in sales pipelines, budget tracking and fund performance reports. |
| RE | Retained earnings | Cumulative net income a company has kept rather than paid out as dividends since its founding, shown within shareholders' equity on the balance sheet. |
| ROU | Right-of-use asset | Asset a lessee records on its balance sheet representing its right to use a leased item, such as an office, store, aircraft or vehicle, over the lease term. |
| SFAS | Statement of Financial Accounting Standards | Numbered accounting standards issued by the Financial Accounting Standards Board from 1973 to 2009, such as SFAS 133 on derivatives and SFAS 157 on fair value… |
| SG&A | Selling, general and administrative expenses | Income statement line covering operating costs not directly tied to production, such as sales commissions, marketing, office rent, executive salaries, legal fees and… |
| SOX | Sarbanes-Oxley Act | US federal law of 2002 that tightened corporate governance and financial reporting for public companies after the Enron and WorldCom scandals. |
| T&E | Travel and expenses | Business costs employees incur while traveling or entertaining for work, such as airfare, hotels, meals, mileage and client entertainment, which are reimbursed through… |
| TB | Trial balance | Listing of all general ledger accounts and their debit or credit balances at a point in time, used to check that total debits equal total credits before financial… |
| VIE | Variable interest entity | US GAAP term for an entity whose equity investors lack sufficient equity at risk or control, so it must be consolidated by the party with power over its key activities… |
| WAC | Weighted average cost | Inventory costing method that values units sold and ending inventory at the average cost of all units available during the period, weighted by quantity. |
| WIP | Work in progress | Partly finished goods in a manufacturing process, recorded as inventory and valued at the materials, labor and overhead costs incurred so far. |
| WoW | Week over week | Percentage change in a metric compared with the previous week, common in e-commerce, app analytics, retail sales tracking and marketing dashboards. |
| XBRL | eXtensible Business Reporting Language | XML-based open standard for tagging financial data so that computers can read and compare financial statements automatically. |
| YoY | Year over year | Comparison of a figure with the same period one year earlier, such as this quarter's revenue against the same quarter last year, expressed as a percentage change. |
| YTD | Year to date | Period from the start of the current year, calendar or fiscal, up to the present date, used to report cumulative figures such as sales, earnings, investment returns or… |
| ZBB | Zero-based budgeting | Budgeting approach in which every expense must be justified from zero for each new period, rather than adjusting last year's budget up or down. |
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