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Glossary of terms used on this site

There are 73 entries in this glossary.
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F

Term Definition
Family Trust

(known as Discretionary trusts) is created to hold assets for the benefit of a class of beneficiaries. Different law applies between Australian States. Family assets are often held in a discretionary trust, under a discretionary trust deed, nominating family members as beneficiaries of the discretionary trust. The trustee may be a natural person or a corporate trustee. This allows the family to direct the use of and benefit from the assets without ownership of them. Discretionary trusts (family trusts) may provide protection of assets in the event of bankruptcy, family breakdown or challenges to a will.

Financial capability

Refers to a business' available access to funds to operate the business. This can relate to either injection of capital from the owners, or ability to borrow from the bank or other creditors.

Financial statements

Formal records of a business' financial activities. These statements provide an overview of a business' profitability and financial condition in both short and long term.

Fire sale

Result of a forced sale of assets when the proprietors have no option and the market is aware of the background. Refers to a sale process under stress those results in a slashing of asset value and a severe loss of capital.

Aliases: Firesale
Fixed costs

Costs which are incurred by a business whether it is operating to generate income or not and which do not necessarily change as the total volume of production increases or decreases.

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