Business Term Definitions

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M-Z

DAMAGE ASSESSMENT: The process of assessing damage, following a disaster, to computer hardware, vital records, office facilities, etc. and determining what can be salvaged or restored and what must be replaced.

damages  a monetary settlement awarded to a party that is injured through a breach of contract

Data Base development: Creating files on your site for dynamic data - information that changes frequently in response to user input. (i.e. password accounts, order forms connected to inventory etc.) Sometimes requires custom programming such as Active Server Scripts, CGI, PHP or Java Scripts. However, the desired data should be served to your visitors seamlessly, on demand.

DATA CENTER RECOVERY: The component of Disaster Recovery which deals with the restoration, at an alternate location, of data centers services and computer processing capabilities. SIMILAR TERMS: Mainframe Recovery.

DATA CENTER RELOCATION: The relocation of an organization's entire data processing operation.

data cleaning services Companies that provide one or more of the specialized services that are part of data cleansing. The success of database marketing is dependent on the quality of the data. Eliminating dirty data (e.g., disparities and contradictions, errors, missing data, and so on) is an important part of data management. It involves a number of intricate and sophisticated steps, such as data correction and validation, standardization of names and addresses, gender assignment, geo- and postal coding, and ZIP+4 processing. Software programs that cleanse data are an alternative to data cleaning services.

Data Element - The basic unit of identifiable and definable information. A data element occupies the space provided by fields in a record or blocks on a form. It has an identifying name and value or values for expressing a specific fact. For example, a data element name

data processing  the transformation of data into a form useful for a specific purpose

data  numerical or verbal descriptions that usually result from some sort of measurement

Database Management Program A program (sometimes called a database manager) that allows multiple users within a system to store and access information in a database. The system maintains the integrity of the data (its availability and organization) and permits only those with access privileges to use it.

database management program  software that allows users to electronically store large amounts of data and to transform the data into information

database management system (dbms)

database  a single collection of data stored in one place that can be used by people throughout an organization to make decisions

day trading Literally, the purchase and sale of stocks made in the span of one day. The growth of online discount brokers has greatly expanded the number of people engaged in day trading; growing numbers are playing the market as a full-time occupation. For managers of highly valued and thinly traded Internet companies, day traders can make or break a stock, buying or selling on a whim or a tip.

DEAD HAND - A term used to indicate the continuing hold of a settlor or a testator, who has been dead for many years, upon living individuals or organizations that are confronted with conditions which the settlor or the testator could not have foreseen. See also Statutes of Mortmain.

Debenture - Debt instrument evidencing the holder's right to receive interest and principal installments from the named obligor. Applies to all forms of unsecured, long-term debt evidenced by a certificate of debt.

Debenture a fixed interest investment in a company, which has priority for interest payments, generally redeemable after the lapse of a specified time

debenture bond  a bond backed only by the reputation of the issuing corporation

debentures — You need to trust in a company and its strength to give this type of loan, which isn’t backed by collateral.

debit card  a card that electronically subtracts the amount of your purchase from your bank account at the moment the purchase is made

Debit To debit is to place an entry on the left-hand side of an account. A debit in a liability account makes it smaller. A debit in an asset account makes it larger.

Debit:  An entry on the left side of a ledger account.

Debt Capital - Business financing that normally requires periodic interest payments and repayment of the principal within a specified time.

debt capital money from external sources used to finance a business. See also equity capital.

debt capital  borrowed money obtained through loans of various types

Debt Financing - The provision of long term loans to small business concerns in exchange for debt securities or a note.

DEBT FINANCING This is financing in which you get a loan from someone or somewhere and go into debt! You are obligated to repay the money at some predetermined interest rate.

Debt Financing. Financing through borrowing capital that must be repaid. Discretionary Income. Disposable personal income less amount spent for necessities such as food, shelter, medical expenses, etc. Disposable Personal Income. Individual "after-tax" income.

Debt Instrument. A generic term representing any written promise to repay the debt.

Debt ratio A solvency ratio measuring the total debt level of a business. The debt ratio is calculated by dividing total liabilities by total liabilities plus net worth. Values greater than 1.0 indicate the business has negative net worth (is insolvent).

Debt Service - the regular payments required to keep a loan current.

Debt Service Coverage. The borrower's annual net operating income before debt service and taxes divided by the annual debt service. A measure of how safe the loan is to the lender.

Debt Service. The cash required to pay the interest and principal due (usually during one year) on outstanding debt.

Debt that which is owed. If you borrow money, buy something on credit or receive more money on an account than is owed, you have a "debt.

Debt/Equity Ratio. A measure of long-term financial solvency of a firm showing the relationship between borrowed capital and owner's equity. Debt/Equity ratio is calculated by taking long-term debt and dividing it by Total Equity. A high ratio might indicate room for capital expansion.

Debt-Financing: A method of financing by borrowing money; a loan that must be repaid, such as a bank loan.

Debtor a person or business who owes money

Debt-To-Equity Ratio. Total liabilities divided by total shareholders' equity. This is a measure of the cushion available to creditors should the firm be forced to liquidate. The ratio is sometimes calculated by dividing total long-term debt by shareholders' equity.

debt-to-net-worth ratio — Also debt-equity ratio. To get it, you divide liabilities by stockholders’ equity. This is a general measure of how safe creditors can feel about their loans. Creditors often avoid lending to companies with a high debt-equity ratio.

debt-to-owners’ equity  a financial ratio calculated by dividing total liabilities by owners’ equity

decentralized organization  an organization in which management consciously attempts to spread authority widely in the lower levels of the organization

decision making  the act of choosing one alternative from among a set of alternatives

decisional role  a role that involves various aspects of management decision making

DECLARATION FEE: A one-time fee, charged by an Alternate Facility provider, to a customer who declares a disaster. SIMILAR TERMS: Notification Fee. NOTE: Some recovery vendors apply the declaration fee against the first few days of recovery.

Declining Balance: The decreasing amount you owe on a debt as you make installment payments.

DEDICATED LINE: A preestablished point to point communication link between computer terminals and a computer processor, or between distributed processors, that does not require dial-up access.

Deduction - An item or expenditure subtracted from adjusted gross income to reduce the amount of income subject to tax.

Deed In Lieu Of Foreclosure. The delivery of an asset's title to the lender when the loan is in default. The approach may benefit both parties by avoiding the expenses associated with foreclosure and the stigma of foreclosure. CAUTION. For tax purposes, the transaction is the same as a sale.

Deed of Assignment: A banking arrangement between the beneficiary of a letter of credit and a third party - usually the supplier of the goods - who requires an assurance of

Deed of protest: Document evidencing that a protest has been carried out.

Deed Of Trust - A document under seal which, when delivered, transfers a present interest in property. May be held as collateral.

deed  a written document by which the ownership of real property is transferred from one person or organization to another

Deep Discount Bond. A bond where the market price is less than 20% or so of its face value. Like a zero coupon bond, the market price of a deep discount bond will rise faster when interest rates fall and drop faster when interest rates rise than a bond that is selling close to its face value.

Deep In, Deep Out Of The Money. A call option whose exercise price is well below the market price of the underlying stock (deep in the money) or well above the market price (deep out of the money). Thus, the premium associated with buying a deep-in-the-money call option is high.

defalcation To misuse or embezzle funds.

Default to fail to meet an obligation when due, such as paying a debt.

Default. The failure of a debtor to comply with a provision of a bond indenture or loan agreement (commonly known as a technical default) or to make timely payment of interest or principal when due.

Default: Failure to pay a debt when due, or otherwise failing to comply with an essential term of a loan payment.

Defaults - The nonpayment of principal and/or interest on the due date as provided by the terms and conditions of the note.

Defeasance. In corporate finance it is generally the discharge of old, low-rate debt without repayment prior to maturity. The corporation replaces it with newly issued securities with a lower face value buy paying higher interest or having a higher market value. The technique can result in tax and balance sheet advantages.

DEFEASIBLE - Capable of being annulled or rendered void, as a defeasible title to property.

Defense Acquisition Regulatory Council (Darc) - A group composed of representatives from each Military department, the Defense Logistics Agency, and the National Aeronautics and Space Administration and that is in charge of the Federal Acquisition Regulation (FAR) on a joint basis with the Civilian Age

Defense Contractor - Any person who enters into a contract with the United States for the production of material or for the performance of services for the national defense.

Deferred Charge. An expenditure carried as an asset until the amount represents a true expense for the period. For example, if a one-year insurance premium is paid three months before the end of the fiscal year, three months of the premium would be an expense in the year paid, nine months would be an expense of the following year. Thus, 9/12 of the premium would be a deferred charge. In this case it would be represented by an account called prepaid insurance. Deferred income is the opposite situation. For example, six months rent received in advance. Any amount not properly credited to the current period would be represent a liability.

DEFERRED COMPENSATION - The postponement of payment for services presently rendered until a future time.

Deferred compensation. An arrangement that allows an employee to receive part of a year's pay in a later year and not be taxed in the year the money was earned.

Deferred Interest Bond. A bond where interest payments are not made currently, but at a later date. Similar to a zero coupon bond which pays 'interest' and principal at maturity. The interest, in effect, is compounded and paid at maturity. Market prices for such bonds are much more volatile than bonds which pay interest currently.

Deferred Loan - Loans whose principal and or interest installments are postponed for a specified period of time.

Deferred Payment Credit: A type of letter of credit which provides for payment some time after presentation of the shipping documents by the exporter (i.e. x days after sight).

deficiency An internal control shortcoming or opportunity to strengthen internal controls.

DEFICIENCY JUDGMENT - A judgment for the balance of a debt after the security has been exhausted; as a deficiency judgment following the foreclosure of a mortgage. See also Judgment.

deflation — Opposite of inflation. Decrease in the general price of consumer goods and services.

delegation  assigning part of a manager’s work and power to other workers

Delinquent: A credit account which is past due.

demand (usually a bill of exchange).

Demand an order to comply with an obligation. In business, paying on "demand" means that the obligation must be satisfied immediately when requested.

demand deposit — Checking account. So named because you can demand your money—or write a check—without clearing it with the bank first.

demand deposit  an amount on deposit in a checking account

Demand Deposit. The technical name for a checking account or any other type of account where the funds can be withdrawn without prior notice.

Demand Loan. A loan with no set maturity date. The loan is payable whenever the lender chooses to call it.

demand  the quantity of a product that buyers are willing to purchase at each of various prices

demand  the quantity of a product that buyers are willing to purchase at each of various prices

democratic leader  one who holds final responsibility but also delegates authority to others, who help determine work assignments; communication is active upward and downward

Demurrage: Charges made for storing goods at the port of destination while awaiting

denial of service (dos) attack A malicious attack generally perpetrated by a hacker intent on disrupting individuals ability to get to Websites or e-mail. In the most common form of DoS, the attacker sends so many messages to a Website that regular users cant get through or it shuts down completely. DoS is a criminal act, even when done as a prank, and major attacks are aggressively investigated by the Department of Justice.

department store  a retail store that (1) employs twenty-five or more persons and (2) sells at least home furnishings, appliances, family apparel, and household linens and dry goods, each in a different part of the store

DEPARTMENTAL RECOVERY TEAM: A group of individuals responsible for performing recovery procedures specific to their department.

departmentalization by customer  grouping activities according to the needs of the various customer populations

departmentalization by function  grouping jobs that relate to the same organizational activity

departmentalization by location  grouping activities according to a defined geographic area in which they are performed

departmentalization by product  grouping activities related to a particular product or service

departmentalization  the process of grouping jobs into manageable units

Depletion The book entry reduction in the value of a natural resource asset due to "using up" the natural resource. For example, the using up (depletion) of gravel deposits, petroleum reserves, or other natural resource property.

Depletion. A system similar to depreciation that allows the owner of natural resources (for example: a coal mine or an oil well) to deduct a portion of the cost of the asset during each year of its presumed productive life.

depreciation — Dividing the cost of an asset over that asset’s usable life. When dealing with a $200,000 factory expected to be used for 10 years, you would count $20,000 a year as expenses. Assets are considered unusable if they don’t work well anymore or are obsolete.

Depreciation - If property acquired to use in a business has a useful life longer than one tax year, part of it must be deducted in each year, for example, office equipment, buildings, machinery, and equipment.

Depreciation - The gradual erosion of the usability and value (possibly due to obsolescence) of an enterprise's fixed assets. In some cases depreciation can be declared as a tax deduction.

DEPRECIATION Decrease in the value of equipment over time. Depreciation of equipment used for business is a tax-deductible expense.

depreciation expense gradual reduction of the value of a fixed asset and gradual application of this cost to the expenses of a business over the useful life of the asset.

Depreciation Recapture. When tangible personal property is sold, the tax gain is based on the difference between the asset's adjusted basis and the selling price. Any gain up to the amount of depreciation taken is deemed depreciation recapture and taxed as ordinary income.

depreciation schedule a table showing depreciable assets, the year each was purchased, its cost, the percentage by which it is depreciated each year and written down current value.

Depreciation The book entry reduction in the value of a tangible asset (buildings, equipment, vehicles, inventory, etc.) attributable to age, wearing out, and/or obsolescence.

Depreciation The decline in value of a limited-life tangible asset, such as a building, machine, vehicle, equipment, furniture, etc., due to age, and to the normal wear and tear of use. In general, depreciation assigns to a fiscal period a portion of the original cost of the capital cost asset.

depreciation  the process of apportioning the cost of a fixed asset over its useful life

Depreciation. A method of recovering your purchase price or other basis in an asset over its life rather than deducting the full amount immediately. An expense for book purposes or a deduction for tax purposes. Depreciation is often different for book and tax purposes.

Depreciation. A system that allows a business or individual to deduct a portion of the cost of an asset ("recover its cost") during each year of its predetermined "life" (or "recovery period").

Depreciation:  The expense recognized in writing off the cost of a plant or machine over its useful life, giving consideration to wear and tear, obsolescence, and salvage value. Methods vary. Examples are straight line (SL), accelerated methods such as sum-of-the-years digits (SYD), and double-declining balance (DDB) methods. Primarily accelerated depreciation is chosen for a business' tax expense but straight line is chosen for its financial reporting purposes.

depression  a severe recession that lasts longer than a recession

derivative — A type of investment whose value depends on the value of other investments, indices or assets. A stock option is a common type of derivative.

DESCENDANT - One who is descended in a direct line from another, however remotely (child, grandchild, great-grandchild).

design planning  the development of a plan for converting a product idea into an actual product

desktop publishing program  a software package that enables users to combine text and graphics in reports, newsletters, and pamphlets

detection risk The risk audit procedures will lead to a conclusion that material error does not exist when in fact such error does exist.

detective control A control designed to discover an unintended event or result.

Devaluation: The official lowering of the value of one country's currency in terms of one or more foreign currencies.

deviation Departure from prescribed internal control. Often expressed as a rate at which the departure occurs.

DIAL BACKUP: The use of dial-up communication lines as a backup to dedicated lines.

DIAL-UP LINE: A communication link between computer terminals and a computer processor, which is established on demand by dialing a specific telephone number.

digital certificate The digital version of an ID card used in conjunction with a public key encryption system to identify an owner. Digital certificates are issued by a third party known as a certificate authority (CA). Once it is issued by the CA, the digital certificate is included in a transmission of an encrypted message to prove that the sender is truly the person who claims to be sending the message. A digital certificate is a valuable component in such transactions as data security and e-commerce, because it guarantees that the parties exchanging information are indeed who they say they are.

digital employment advertising Online postings of job opportunities on the Internet, including at the sites of companies, professional organizations, recruitment companies, and job boards such as Monster.com, CareerPath.com, CareerMosaic.com, Jobsearch.org, and HeadHunter.net, the top five career-search sites.

digital or electronic cash An electronic cash account, most often stored on your computer or a smartcard, is for purchasing goods online or off. While several digital cash models are in the rollout stage, the general notion is that you can make a purchase and have the cash amount confirmed by the bank, deducted from your account, and paid to the merchant, activating the shipping phase of the end product, all in a few seconds. The use of digital cash is decidedly not widespread; few major U.S. banks participate in any digital cash programs, and even fewer merchants accept any form of digital cash besides Visa- or Mastercard-enabled debit cards.

digital resume Summaries of an individuals education, employment history, and qualifications created in HTML format for dissemination on the Web or ASCII text format for e-mailing and submission to online job-search sites. Digital risumis can be embellished with photos or video clips, or linked to Websites that contain relevant supporting information, such as published articles, research papers, and work samples. Appropriate links to the sites of former employers and clients can also be provided. Specialized software can help job seekers create digital risumis and can help employers process and evaluate them. See American National Standards Institute.

digital shopping companions Browser companion software that operates in the background and pops up to perform a specific task: intercept junk e-mail (spam), compare prices, provide the users password, or manage personal information online. Some shopping companions-Gator, for example-act as digital or smart wallets. They are designed to pop up when the user is ready to make an online purchase and provide shipping and billing information with one click. The information is stored either on the users computer or on a secure Internet site. A visit to E-Trade, for example, may trigger an ad paid for by Schwab, or vice versa. Amazon.coms Alexa, Brodia.com, CyberCashs InstaBuy, and EntryPoint are other digital shopping companions.

digital-rights management system A method of protecting the copyright of digitized content (e.g., music) distributed to consumers online. A number of companies are working on digital-rights management systems, but the edge seems to belong to InterTrust, which has developed a model called a meta-utility to deal with both copyright protection and payment. In the InterTrust model, digital content is packaged in an encrypted file called a Digibox, which includes rules-to be determined by the content distributor-about usage, access, and payment.

digitized  data that has been converted to a type of signal that the computers and telecommunications equipment that make up the Internet can understand

direct costs the costs incurred, in addition to fixed costs, as a result of manufacturing a product or providing a service. Direct costs are made up of direct material, direct labour and direct manufacturing or servicing costs.

Direct Financing Lease(Direct Lease):  A non-leveraged lease by a lessor (not a manufacturer or dealer) in which the lease meets any of the definitional criteria of a capital lease, plus certain additional criteria.

DIRECT MAIL – A marketing effort conducted exclusively by mail.

DIRECT MARKETING – Marketing via leaflets, brochures, letters, catalogs, or print ads mailed or distributed directly to current and potential consumers. The direct marketing industry has grown enormously as a result of increasingly specialized mailing lists.

direct marketing  the use of the telephone and nonpersonal media to introduce products to consumers, who can then purchase them by mail or telephone

Direct Overhead. Costs directly associated with the manufacture of goods. That could include factory lighting, rent, insurance. Indirect overhead could include office expenses, R&D, lighting, etc.

Direct Placement. Also known as a private placement, the sale of securities directly to one or more professional investors or institutions, frequently insurance companies. The sale of securities in this fashion avoids many of the fees typically associated with public offerings.

DIRECT RESPONSE – An advertising technique that urges the audience to respond in a particular manner, usually to buy a product, and provides that audience with the means to do so. A business reply card (BRC) is a direct response tool.

Direct Sales Method - selling direct to the end user with promotional efforts using advertising, direct mail or telephone sales.

direct selling  the marketing of products to ultimate consumers through face-to-face sales presentations at home or in the workplace

DIRECT SKIP - An outright generation-skipping transfer, either by gift or at death, to a recipient, known as a -skip person,- who is two or more generation levels below the transferor. A direct skip also occurs upon a transfer by gift or at death to a trust, all of the beneficiaries of which are skip persons.

directing  the combined processes of leading and motivating

direct-mail advertising  promotional material that is mailed directly to individuals

director’s guarantee a personal guarantee given by a director of a company that s/he will be personally responsible for a debt or other liability of the company. Usually requested in credit applications, leases, loans and hire purchase agreements.

Directors Directors are elected by the shareholders. They manage or direct the affairs of corporation. Typically, the directors make only major business decisions and monitor the activities of the officers.

direct-response marketing  a type of marketing that occurs when a retailer advertises a product and makes it available through mail or telephone orders

Disappearing Deductible. An insurance policy where losses below a certain amount are excluded. Those above a certain amount are paid in full and those in between are paid a multiple of the loss.

DISASTER PREVENTION CHECKLIST: A questionnaire used to assess preventative measures in areas of operations such as overall security, software, data files, data entry reports, microcomputers, and personnel.

DISASTER PREVENTION: Measures employed to prevent, detect, or contain incidents which, if unchecked, could result in disaster.

DISASTER RECOVERY ADMINISTRATOR: The individual responsible for documenting recovery activities and tracking recovery progress.

DISASTER RECOVERY COORDINATOR: The Disaster Recovery Coordinator may be responsible for overall recovery of an organization or unit(s). SIMILAR TERMS: Business Recovery Coordinator.

DISASTER RECOVERY PERIOD: The time period between a disaster and a return to normal functions, during which the disaster recovery plan is employed.

DISASTER RECOVERY PLAN: The document that defines the resources, actions, tasks and data required to manage the business recovery process in the event of a business interruption. The plan is designed to assist in restoring the business process within the stated disaster recovery goals.

DISASTER RECOVERY PLANNING: The technological aspect of business continuity planning. The advance planning and preparations which are necessary to minimize loss and ensure continuity of the critical business functions of an organization in the event of disaster. SIMILAR TERMS: Contingency planning; business resumption planning; corporate contingency planning; business interruption planning; disaster preparedness.

DISASTER RECOVERY SOFTWARE: An application program developed to assist an organization in writing a comprehensive disaster recovery plan.

DISASTER RECOVERY TEAMS (Business Recovery Teams): A structured group of teams ready to take control of the recovery operations if a disaster should occur.

DISASTER RECOVERY: The ability to respond to an interruption in services by implementing a disaster recovery plan to restore an organization's critical business functions.

DISASTER: Any event that creates an inability on an organizations part to provide critical business functions for some predetermined period of time. SIMILAR TERMS: Business Interruption; Outage; Catastrophe.

Disbursement - The actual payout to borrower of loan funds, in whole or part. It may be concurrent with the closing, or follow it.

Disbursements funds paid out of a business in settlement of obligations.

Disbursing Officer - An employee authorized to pay out cash or issue checks in settlement of vouchers approved by a certifying officer.

discharge by mutual assent  termination of a contract by mutual agreement of all parties

Discipline designed to identify, attract, and retain a company’s most valuable customers. Theoretically, CRM can provide a unified enterprise-wide view of the customer to cultivate high-level relationships that can lead to improved loyalty and profits. Effective CRM requires an integrated sales, marketing, and service strategy. CRM has resurfaced because technology has ameliorated its implementation. Information systems make it possible to capture detailed customer information and distribute it throughout the company. An astute CRM strategy can anticipate needs; tailor messages, products, and services; create value; anticipate problems; and improve the customers overall experience in dealing with the company.

disclaimer (disclaim) A statement that the auditor is unable to express an opinion as to the presentation of financial statements in conformity with U.S. GAAP.

disclosure Revealing information. Financial statement footnotes are one way of providing necessary disclosures.

Discount a deduction made from the normal cost or purchase price.

discount brokers — Discount stock brokers are to full-service brokers as warehouse stores are to boutiques. You don’t expect much, if any, advice from your discount broker on what to buy. She or he usually doesn’t expect you to pay as much as you would at full-service brokers. A discount broker’s main job is to carry out your requests to buy and sell.

discount rate  the interest rate that the Federal Reserve System charges for loans to member banks

Discount Rate. 1. The rate used to compute discounted cash flows or the present value of an investment. 2. The interest rate that the Federal Reserve charges member banks for loans.

discount store  a self-service, general-merchandise outlet that sells goods at lower-than-usual prices

Discount Yield. The yield on a security sold at a discount. U.S. treasury bills are sold at a discount. The face amount is returned to the investor at maturity. The annual yield is computed by dividing the discount by the face amount, then multiplying by the number of days in the year (360) and dividing by the number of days to maturity.

discount  a deduction from the price of an item

Discount. This term can have a number of meanings, depending on the context. When used in connection with a loan, it's where the bank deducts its interest payment before giving the loan proceeds to the borrower. For example, where $100 is borrowed at 10% for one year, the borrower receives only $90. For bonds, it's the difference between the current market price and the face amount of the bond.

Discounted Cash Flow. The application of a factor, based on the cost of the firm's capital or prevailing interest rates (with a possible adjustment for risk), to the cash inflows and outflows from a project or investment. Also called net present value analysis.

Discounting of bills: Where the payee of a term bill requires payment immediately, a bank may discount the bill, i.e. make immediate payment, deducting an amount for

discovery sampling Acceptance sampling (sampling to determine whether internal control compliance is greater than or less than the tolerable deviation rate) when expected attribute occurrence rate is zero.

discretionary income  disposable income less savings and expenditures on food, clothing, and housing

discretionary order  an order to buy or sell a security that lets the broker decide when to execute the transaction and at what price

Dishonoured the word used to describe a cheque, which the bank will not pay, because the customer’s account lacks sufficient funds.

disintermediation Cutting out, or displacing, the middleman, or intermediary, between producers and consumers in transactions. By facilitating connections between producers and consumers, the Internet has struck fear into the hearts of middlemen in a variety of industries. Travel and insurance agents, stockbrokers, and bankers are among those experiencing disintermediation, as newly empowered consumers buy airline tickets, insurance, securities, and mortgages without their services.

Disintermediation. When individuals (or other entities) take money out of savings accounts and put the funds in money market accounts.

Dispatch: An amount paid by a vessel's operator to a charter if loading or unloading is completed in less time than stipulated in the charter party.

DISPLAY AD – An illustrated advertisement in a newspaper or magazine.

disposable income  personal income less all additional personal taxes

disruptive technology A phrase coined by Clayton Christensen of the Harvard Business School to describe any technology that overturns a traditional business model. It could apply to the steam engine in the age of sail, for example, as well as to the Internet in the age of paper linearity.

Dissolution Is the termination of a corporation's legal existence. Dissolution may be caused many ways including, failure to file annual reports, failure to pay certain taxes, bankruptcy, or voluntary dissolution of the corporation by the shareholders and directors. Business Filings does perform voluntary dissolution filings.

Dissolution: Methods by which a corporation concludes its business and liquidates. Dissolutions may be involuntary because of bankruptcy or credit problems or voluntary on the initiation of the directors or shareholders of a corporation.

distance learning The process of obtaining education or training from a site where you are not present at the time it is being given. This can run the gamut: Students can attend a seminar beamed to 100 business schools around the country and patched into a large-screen television. Or an engineer can receive onsite training via the computer to solve a malfunction on a North Atlantic oil rig. See e-learning.

DISTRIBUTED PROCESSING: Use of computers at various locations, typically interconnected via communication links for the purpose of data access and/or transfer.

Distribution Channel - the path your product follows to be delivered to the end user. This may be through distributors, retail outlets, self service outlets, vending machines, telephone sales, direct mail sales, etc.

Distributions to owners Distributions of business funds to the owners of a business. (Also called withdrawals, monthly draw, or draw.)

Distributor - an enterprise that purchases your products for resale to their customers who are usually retail outlets. The distributor expects to receive a significant price discount for providing the distribution service.

Distributor: A foreign agent who sells for a supplier directly and most often collects all payments from customers and maintains an inventory of the supplier's products.

diversification — An investing technique. The idea is to buy lots of different types of investments so if the value of one nose dives, you’re not suicidal.

DIVERSIFICATION - The process of spreading the investment of a fund both as to type of securities and as to industries.

diversification  the process of spreading assets among several types of investments to lessen risk

Divestiture - Change of ownership and/or control of a business from a majority (non-disadvantaged) to disadvantaged persons.

divestiture  the process of dismantling a company and selling off different parts

Dividend - A distribution of the earnings of a corporation. Dividends may be in the form of cash, stock or property. All dividends must be declared by the board of directors. Syn. stock dividend. See also dividend yield.

Dividend a distribution of the profits of a company among its members or shareholders.

Dividend A dividend is a distribution of money or property paid by the corporation out of the corporation's profits to shareholders. Dividend payments are subject to double taxation, the corporation pays tax on its profits and the dividend recipient must pay income taxes on the dividend payment, the same money is taxed twice. The directors of the corporation decide if a dividend payment is to be made and it can only be made if the corporation has profits.

Dividend Exclusion. Regular (not S) corporations can exclude from income 70% of dividends received. If the corporation owns 20% or more of the stock of the other corporation, it can exclude 80%. A 100% exclusion is provided for 80% plus owned corporations.

Dividend Payout Ratio. The ratio of the annual dividend to the earnings of a company. Stable, mature companies (such as utilities) typically have a high payout ratio.

dividend  a distribution of earnings to the stockholders of a corporation

Dividend:  That portion of a corporation's earnings that is paid to the stockholders.

Dividend: A distribution of money or property paid by the corporation to a shareholder based on the amount of shares held. Dividends must be paid out of the corporations net earnings and profits. The board of directors has the authority to declare or withhold dividends based on sound business discretion.

dividends — Payments corporations make to their shareholders. The per-share amount is determined by corporate earnings.

Dock receipt:  A receipt issued by an ocean carrier to acknowledge receipt of a shipment at the carrier's dock or warehouse.

Dock Statement: A receipt issued by an ocean carrier to acknowledge the receipt of a shipment at the carrier's dock or warehouse facilities.

document (documentary) (documentation) Written or printed paper that bears information that can be used to furnish decisive evidence. Could also be a recording, computer readable information, or a photograph.

document management The computerized management of electronic and paper-based documents. A document management system generally includes an optical scanner and optical character recognition (OCR) system to convert paper documents into electronic form, some form of database management system (DBMS), and a search mechanism.

Document of title: A transport document (usually a bill of lading) which (when appropriately made out) entitles the bearer to claim the goods from the carrier.

Documentary collection: Procedure in which banks in the buyer's and seller's country act for the seller by presenting commercial documents to the buyer along with a payment

Documentary credit: sometimes used as another name for a letter of credit.

DOG AND PONY SHOW (colloquial) – An elaborate pitch or presentation of an advertising campaign.

Doing Business As (DBA) A "DBA", also known as an "assumed name", is typically completed by making a filing at the county level where the business is located. This filing does not change the official name of the corporation; however, it allows the company to use additional names.

dollar-cost-averaging — A system of buying securities at regular intervals with a fixed-dollar amount. The investor buys by the dollar’s worth rather than by the number of shares. If the number of dollars stays constant, investments buy more shares when prices are low and fewer when prices are high. Temporary downswings in price benefit the investor who continues to buy in good times and bad, as the price at which shares are sold exceeds the average purchase price.

Domain name:  a unique name assigned to a numerical address that identifies your site on the World Wide Web.

Domestic Corporation A corporation is a domestic corporation in the state where it has incorporated.

domestic corporation  a corporation in the state in which it is incorporated

Domestic corporation: A corporation is a domestic corporation in the state in which it is incorporated. See also Foreign corporation.

domestic system  a method of manufacturing in which an entrepreneur distributed raw materials to various homes, where families would process them into finished goods to be offered for sale by the merchant entrepreneur

dot-commercial Interactive marketing that is a hybrid of television advertising and online media. Instead of just flashing up the Website address, the television commercial sends consumers to a Website for a specific activity: to view alternative endings for the spot, provide input on how the script evolves, order free customized CDs, etc.

Double Taxation Corporations are treated as a separate legal taxable entity for income tax purposes. Therefore, corporations pay tax on their earnings. If corporate earnings are distributed to shareholders in the form of dividends, the corporation does not receive the reasonable business expense deduction, and dividend income is taxed as regular income to the shareholders. Thus, to the extent that earnings are distributed to shareholders as dividends, there is a double tax on earnings at the corporate and shareholder level. S corporations and LLCs are pass-through entities which are not subject to the double tax.

double-entry bookkeeping  a system in which each financial transaction is recorded as two separate accounting entries to maintain the balance shown in the accounting equation

Double-Entry Bookkeeping. An accounting system where every debit made to one account has a corresponding credit made to another account.

Dow Jones Industrial Average — An important stock market indicator, used to judge the stock market’s general well-being and how well your stocks are doing comparatively. It measures the performance of 30 industrial stocks. When the media reports that the market rose 20 points, they’re really saying the Dow rose 20 points.

DOWNLOADING: Connecting to another computer and copying a program or file from that system.

draft  issued by the exporter’s bank, ordering the importer’s bank to pay for the merchandise, thus guaranteeing payment once accepted by the importer’s bank

Draft: Another name for a bill of exchange.

Drawee: Party on whom a bill of exchange is drawn, i.e. who is required to make payment.  In the context of collections, usually the buyer.  In letters of credit, the drawee is usually a bank.

Drawer the person who writes a cheque in payment for goods or services.

Drawer: Party drawing up the bill of exchange. Usually also the payee, to whom the money is due. Often used to designate the 'seller'.

Drawings Account:  The account used to show the withdrawals of earnings by the owner(s) of a sole proprietorship or partnership.

Drawings withdrawals of assets (usually cash) from a business by a sole proprietor or a partner.

Drawings:  Distribution to the owner(s) of a sole proprietorship or partnership.

DRIVE TIME – The hours when the most commuters are in their cars. During "drive time," radio advertising costs more because of increased listenership.

DROP SHIPMENT A shipment directly from the manufacturer to the end user.

dual date If a major event