One of a series of short-term steps that must be taken to fulfil a longer-term strategy.

Take-home Pay:

The amount of pay that employees actually take home; that is, their gross pay net of tax, national insurance and other deductions that are made in advance of payment.


The formal process whereby one company buys another. In the case of a quoted company this involves following the often complex rules of the stock exchange on which the company is quoted.

Tangible Asset:

Literally, an asset that can be touched. Buildings, machines and cash are all tangible assets.

Tangible Net Worth:

The net worth of an organization minus its intangible assets, things like goodwill and the value of patents. Tangible net worth gives a more immediately realizable value of the organization.

Target Market:

The specific market at which a company aims its products; for example, teenagers, elderly widows, product does not have a target. It hopes that everybody wil buy its merchandise.


There are two meanings:
  1. An ad valorem tax imposed on imported goods, often as a form of protectionism.
  2. A schedule of prices.


The due that are levied on individuals and corporations to pay for the running of governments.

Tax Assessment:

A formal agreement between a taxpayer and a government as to how much tax is due from the taxpayer for a particular period.

Tax Avoidance:

This term implies that a taxpayer has arranged his affairs in such a way either that his tax burden is less than it would otherwise have been or that no tax is payable as a result of such arrangement. The term is generally employed so as to indicate that the taxpayer has acted in a lawful manner and differs fundamentally in this regard from the concept of "tax evasion" which is illegal.
See also: Anti-Avoidance Measures; Tax Evasion; Tax Shelters.

Tax Clearance Certificates:

A certificate issued by an Income Tax Department confirming that an individual departing from a country has fulfilled all his income tax obligations and has no arrears. The certificate must be shown to customs and emigration authorities upon departure from the specific country.

Tax Deductible:

Any expense which can be paid for out of untaxed income without incurring a tax liability. Tax Evasion: Fraudulent or illegal arrangements made with the intention of evading tax, e.g. by failure to make full disclosure to the revenue authorities. The term denotes those activities deliberately undertaken by a taxpayer to attempt to free himself in an illegal manner from the tax to which he is subject. Tax evasion embraces such activities as sham transactions and the falsification of tax returns or of books and accounts. The element of illegality distinguishes tax evasion from tax avoidance.
See also: Tax Avoidance.

Tax Exempt Company (as found in the Channel Islands and the Isle of Man): This is a company designed for companies and individuals who are foreign to the jurisdiction in which it is registered, providing a maximum of privacy, combined with comprehensive freedoms from local taxation. Tax Exempt companies (often referred to simply as Exempt Companies) pay a tax-exempt fee each year. This fee is a fixed annual fee exempting the company from further tax liabilities in the jurisdiction in which it is registered. It also has to pay annual filing fees (governmental fees) and domicillary fees (service provider's fees) in order to remain registered. The relevant tax-exempt fee for the relevant jurisdiction is denoted in the e-offshore list for every jurisdiction.

Tax Haven:

The term Tax Haven is generally used to refer to a jurisdiction: 1) where there are no relevant taxes; 2) where taxes are levied only on internal taxable events, but not at all, or at low tax rates, on profits from foreign sources; or 3) where special tax privileges are granted to certain types of taxable persons or events. Such special tax privileges may be accorded by the domestic internal tax system or may derive from a combination of domestic and treaty provisions. (Where tax benefits are part of an economic development programme the term tax incentives is usually used).

Simply stated, a tax haven is any country whose laws, regulations, traditions, and, in some cases, treaty arrangements make it possible for one to reduce his over all burden.The tax havens of the world broadly may be classified into six separate categories: 1) no-tax havens (e.g., Anguilla, Bahamas, Bermuda, Cayman Islands, Nevis, Turks and Caicos, St. Vincent and Vanuatu); 2) countries taxing only local income (e.g., Costa Rica, Liberia, Panama, Gibraltar and Hong Kong); 3) low-tax havens with treaty benefits (e.g., the Netherlands, the Netherlands Antilles, British Virgin Islands, Luxembourg and Singapore); 4) countries offering special privileges (e.g., Channel Islands and the Isle of Man); 5) tax havens for individuals (e.g., Andorra, Sark, Campione d'Italia and Monaco; 6) tax havens for International Business Companies (e.g., Antigua, Barbados, Grenada, Jamaica and Montserrat).

See also: The Offshore Manual & Directory .

Tax Holiday:

A designated period of time, whose duration usually is five to ten years but in some instances is up to 30 years, in which the Government exempts or reduces from taxation income, sales, capital, property, customs or other taxes. Today the trend is for the tax holiday period to be limited in urban areas and longer in suburban and rural districts.

Tax Incentives:

The term Tax Incentives is used when tax benefits are part of an economic development programme. Most tax incentive measures fall into one or more of the following categories: tax exemption (tax holiday);

deduction from the taxable base; reduction in the rate of tax; tax deferment.

Tax Loophole:

An unintended benefit permitted under the tax laws of a country when previously the Government unknowingly approved legislation that encourages a taxpayer to take advantage of a tax reduction or exemption, which the legislators had foreseen.

Tax Loss:

Any loss made by a company which it is able to transfer to another accounting period and to set off (for tax purposes) agoinst profit arising during that period.

Tax-loss Company:

A company that has accumulated losses which are not allowed for income tax purposes but may be attractive to another company so that a takeover or merger of the company suffering a loss will place the latter on a profitable basis. In this way the losses are used to reduce or eliminate the tax liability of the resulting company when it seubsequently shows profits.

Tax Planning:

See International Tax Planning.

Tax Return:

The form on which the details of a taxpayer's income, expenditure and capital gains are sent to the tax authorities.

Tax Shelter:

The term "tax shelter" is sometimes employed to refer to those jurisdictions where taxes are levied only on internal taxable events, but not at all, or at very low rates, on profits from foreign sources.

In domestic tax law the term applies to a variety of devices which allow taxpayers to deduct certain artificial losses, i.e. losses which are not really economic losses but represent losses which are available as deductions under the current tax laws. These artificial losses may be offset not only against income from the investment out of which they arise, but also against the taxpayer's other income, usually from his regular business or professional activity.

Tax Sparing:

The sphere of application of a tax incentive may be extended by way of a tax-sparing clause in a treaty between a capital importing country and a capital exporting country. Such clauses allow residents of the capital exporting country a credit against domestic tax for profits or gains derived in the developing country in respect of which all or specified taxes are subject to exemption or reduction in the latter country.

Normally tax treaties are not concluded between high tax jurisdictions and tax havens. In line with this approach certain tax treaties specifically exclude from their scope entities, which benefit from specially favored tax treatment (e.g. the exclusion of Luxembourg holding companies from the provisions of tax treaties concluded with Luxembourg). However, certain colonies or former colonies of the United Kingdom and the Netherlands benefit from extensions (with or without modification) of treaties concluded respectively by the United Kingdom and the Netherlands. The existence of such treaty links may be of considerable value with regard to tax haven operations taking place in jurisdictions such as the British Virgin Islands and the Netherlands Antilles.

Tax Treaties:

Tax treaties are international agreements or conventions concluded with the object of eliminating double taxation by the contracting states. International double taxation may be loosely defined as the imposition of comparable taxes in two (or more) states on the same taxpayer in respect of the same subject matter and for identical or overlapping periods. The most harmful effects of double taxation are on the exchange of goods and services and on the movement of capital and persons.


Techniques for improving the ways in which individuals work together in teams. Team-building aims to make teams more than the sum of their parts.


Work that is done in teams. An increasing amount of workplace activity consists of teamwork.


A short advertisement that does not name the product being advertised, but merely hints at more advertising to come. Teasers are often used to launch new products.


The use of science and scientific methods to improve performance.

Technology transfer:

The transfer of a company's technology in return for access to a market. Technology transfer is frequently promised by western companies as a way of gaining access to developing-country markets.


A prolonged telephone conversation between more than two people situated in more than two places. Teleconferences are a substitute for meetings in cases where the participants cannot easily get together in the same room at the same time.


The use of the telephone as a channel for marketing goods and services.


The practice of working at a distance from a head office or workstation via modem links and telecommunications.


An out-of date method of transmitting typed messages via telephone lines. The telex was largely made redundant by the fax machine.


Someone who is temporarily employed by an organization to do a set task, often secretarial, for a short time.


Somebody who holds a right to occupy land or buildings that are owned by somebody else.


Somebody who holds a right to occupy land or buildings that are owned by somebody else.


To make an offer (in writing) to do a certain specified piece of work for a specified price.

Tender Offer:

An offer to buy a specified number of securities at a specified price. If fewer than the specified number of securities are offered, the person making the offer is not obliged to buy any of them.


There are two business-related meanings:
  1. The period of time during which the conditions of a contract apply.
  2. The conditions themselves, as in "terms and conditions"

Term loan:

Any loan which has to be repaid in full within a stated period of time.


The interface between a computer network and an individual computer user.

Terms of trade:

The ratio of a country's export prices to its import prices. The prices are calculated as an index based on an arbitrary starting point. Terms of trade thus measure changes over time rather than absolute values.

Test Market:

To try out a new product or service by launching it initially in a limited area.


A statement by a respected source vouching for the high quality of a product or a person.

The 10% Rule:

The portion of dividend income and other items of undistributed foreign base company income exempt from current taxation under the United States Internal Revenue Code if for the taxable year such income items amount to less than 10% of the total gross income of the controlled foreign corporation. In other words, the controlled foreign corporation is treated as having no foreign base company income. The 10% rule is also i known as The 10-70 Rule because, if foreign-base company income is more than 70%, then all the company's income is treated as foreign base company income. Until the Tax Reduction Act of 1975, effective as of January 1, 1976, this was known as The 30% Rule or The 30-70 Rule, because 30% was the designated excluded amount instead of 10%. Under the 1986 Tax Reform Act, the interest level was reduced to 5% so that the so-called 10% rule became the 5% rule in name and practice and the 5-70% rule refers to a foreign base company having income amounting to more than 70%.

>Third Party:

Someone invited to play a role in a contract or agreement who is not one of the two parties to the agreement; an outsider with an incependent view.


The mere act of thinking about ideas and concepts like Freedom or Revolution.

Time and a half:

The payment to an employee of 1.5 times their normal hourly rate for working at an anti-social time outside their normal working hours; in particular, the rate paid in the West for working in the early evening or on Saturdays.

Time and Motion:

An old-fashioned system of measuring the time taken and the motions required to carry out particular industrial tasks. Time and motion studies were designed as a way of measuring changes in individual employees' productivity.

Time Management:

A systematic way of managing the use of time, particularly in the workplace, based on the idea that time is money. One popular time-management tool is called a diary.


The right to the ownership of property. If someone has "good title" to a property, it means that there is no dispute about their ownership of that property.

Toll-free number:

A telephone number where the receiver pays for the calls rather than the caller. Toll-free numbers are widely used in certain forms of marketing.


Short for total quality management, the idea that quality management should infuse every single process in a company's operations.


There are two meanings:
  1. To buy and sell goods and services, usually across national boundaries.
  2. A profession or skill. For example: "He's in the meat trade."

Trade Barrier:

Something that hinders the free flow of trade, especially import duties and things which make imported goods less competitive vis-à-vis domestically produced goods.

Trade Discount:

A discount given by one member of a trade to another; for example, by a wholesaler of garments to the owner of a fashion boutique.

Trade Fair:

A large organized event at which producers of a defined range of goods and services (often from a number of different countries) show off their wares to potential customers and to each other.


The unique mark that a manufacturer puts on to its products to distinguish them from any other manufacturer's products; for example, the label on a pair of Levi jeans. To help protect them from being copied, manufacturers can have their trademarks officially registered in most of the worldøs leading industrial countries. To enjoy the protection of registration, however, a manufacturer must demonstrate that its mark is both distinctive and in continuous use.

Trade Mission:

An organized trip abroad by a group of businessmen designed to introduce them to potential customers, representatives, politicians, and so on, in the foreign country.

Trade Off:

Yielding one asset to gain another. For example, selling a building to realize a tax loss that can then be set off against the year's trading profit.

Trade Program:

A term for the participation in the buying and the selling of bank debentures.

Trade Secret:

Any proprietary way of conducting a trade (or profession) that enables its practitioner to be more competitive than its rivals. No firm wants its trade secrets to be discovered by anybody else.

Trade Union:

A group of workers who organize themselves to promote the rights of employees and to improve conditions in the workplace. In particular, a union is able to use the collective bargaining power of all its members when negotiating with employers on matters such as wage increases.


A person in the process of being trained how to do a particular job. If a trainee fails to pick up the necessary skills withing a certain time, he or she may not be taken on by the company as a full-time employee.


A specified part of a larger transaction. Each purchase and resale of a separate block of bank instruments within the total transaction is known as a tranche. For example, a contract may be signed to buy 100 million US dollars worth of bank paper with an initial tranche (or purchase) of 25 million US dollars.

Transaction Cost:

The cost of carrying out a transaction; for example, the cost of clearing a check, or of buying something at an auction.


The form signed by the seller of a security authorizing the company to remove his name from the register and substitute that of the buyer.

Transfer Payment:

A payment by a government to its citizens that is not made as a reward for the supply of goods or services – for example, unemployment benefit.

Transfer Pricing:

The shifting of profit from one part of a group to another by the charging of artificial (non-market) prices for the provision of goods and services between the parts. Transfer pricing is used to move taxable profits from a high-tax jurisdiction to a low-tax one.

Transformer Company:

A licensed insurer which "transforms" insurance risks of insurance companies into capital market transactions. In Bermuda, transformer companies are frequently used, generally by Class 4 insurance companies which segregate the risk of insurance and reinsurance obligations.


A company which straddle national boundaries. A transnational company is not a multinational. The latter's business operations work independently of each other. The many different and far-flung operations of a transnational are inextricably linked with each other.


The principle of making company accounts as clear as possible so that their readers can see for themselves the transactions that underlie them.

Transparent or Conduit Entity:

A form of business organization in which the members or partners are subject to individual tax and/or legal liability for the obligations of the organization. A transparent entity also is known as a conduit. Transparent entities in the United States include S corporations, partnerships and grantor or simple trusts and other associations taxable as a partnership, such as a limited liability company. Members can include individuals or other unlimited liability investors as well as corporate or limited liability investors. The determination of whether an entity is subject to tax as a conduit entity must be made for the country in which the entity is organized and in the country of investor(s). The primary tax advantage of forming a transparent or conduit entity is to avoid an entity level tax and flow through profits and losses directly to investors. A transparent entity could be used for joint venture projects, real estate investment and leasing or mutual fund businesses.


The practice of unloading a cargo at one place (a port or an airport, for example) so that it can be transferred to another mode of transport that will take it on to its final destination.

Traveller's Check:

A means of enabling travellers to make payments when abroad. The traveller's check, now over 100 years old, relies on the simple security device of the couble signature. Owners sign once when they buy the cheque, and agin when they sell it. If they lose the check in between signatures they can get it replaced by the issuer.


The (senior) manager withing a company who is responsible for the safekeeping of all the money that comes into the business, and for the wise spending of the money that goes out of it.


A Liechtenstein form of a trust.


Another Liechtenstein form of a registered trust, designed to undertake commercial activities.

Trial Offer:

A special promotion that allows a consumer to try a product for a period of time before deciding whether or not to buy it.

Triangular Hedge:

Use of a local currency commodity-dollar as payment for exchange of goods in the practice of counter trade or barter, with the commodity contracts frequently negotiated on futures exchange for the long term in such staples as sugar, copper and petroleum.

Trigger Price:

The price of imported goods below which predetermined restrictions on imports come into effect. The restrictions are aimed at preventing cheap imports from flooding the market and damaging domestic producers.


A person who goes into trouble companies at a senior level in order to solve specific short-term problems.

True and Fair:

The accountants' mantra: that the figures ina company's accounts should represent a true and fair view of the company's affairs. The idea is subject to individual interpretation.


A trust is the relationship which arises whenever a person or corporate entity, called a trustee, is compelled in equity to hold property (whether real or personal, and whether by legal or equitable title) for the benefit of some other persons who are termed Beneficiaries, or for a lawful purpose in such a way that the real benefit of the property accrues to the Beneficiaries of the Trust. A trust must have a settlor or a person who establishes the trust to take over the ownership of assets. The trustee is an individual or corporation to which legal ownership of the assets is transferred. A trustee must supervise, manage, invest and distribute the assets in accordance with the trust deed. The trust deed states the terms and conditions under which the trustee operates. A benficiary is the intended owner of the assets placed in the trust. The protector is a guardian who ensures that trustees carry out the wishes of the settlor.
  1. The Testamentary Trust: A trust created by the Grantor/Settlors at death by will. This is a type of trust which does not avoid probate, since the assets used to fund the trust are controlled by the will which is administered by the probate court. These types of trusts may sometimes be subject to ongoing jurisdiction of the probate court.

  2. Inter Vivos Trust: Also known as living trust or loving trust, the Inter Vivos Trust is created during the Grantor's life and is generally revocable during his or her lifetime. Living trusts have numerous advantages over testamentary trusts in that they can avoid the delay and expense of dealing with the probate court and lawyers; solve the disability or potential guardianship problems of the Grantor as he or she becomes elderly; maximize available tax planning; avoid forced heirship laws; and provide for flexible methods of distributing assets to beneficiaries as and when intended. Many estate and trust professionals recommend living trusts to hold all assets during life.

  3. Life Insurance Trust: This is a form of living trust that holds the ownership of insurance policies and provides for the distribution of the insurance proceeds on the death of the insured/grantor. This type of planning is particularly popular in the United States, as insurance is one of the single most useful wealth transfer devices permitted under United States estate tax law.

  4. Charitable Trust: Either a living trust or testamentary trust, the charitable trust has charities as its beneficiary. A charitable reminder trust which allows current income tax benefits to be obtained in the form of charitable deductions - with the property ultimately going to charity free of estate tax – benefits those with substantial wealth. A charitable lead trust (CLT) is a vehicle for passing wealth to subsequent generations while also satisfying the donors' philanthropic interests and not only providing for immediate charitable income tax deduction but also requiring the grantor to report all income realized by the CLT on his or her annual personal income tax return. The grantor is not permitted an income tax deduction for the current value of the lead interest.

  5. Protective Trust: The Protective Trust provides specific provisions, either inter vivos or testamentary, whereby the Settlor ensures protection of the property for beneficiaries who may be incompetent, improvident, or about to be divorced. It should be noted that a protector trust cannot benefit the grantor with immunity from his own creditors. However, a grantor can settle a trust to protect a beneficiary from claims of the beneficiary's creditors and even from claims in a divorce.

  6. Discretionary Trust: This popular type of trust provides powers to a trustee that allows the trustee to decide which beneficiary, or who among a class of beneficiaries, may be given distributions of the trust assets. The essence of a discretionary trust is that a beneficiary has no right to claim any part of the income or even principal. The trustee is given the flexibility to ay the beneficiary or apply trust assets for his benefit as the trustee thinks fit. Discretionary trusts are particularly useful in protective trusts. It should be noted that under the English Trustees Act of 1925, Section 33, a protective trust can be created expressly by creating a determinable life estate followed by a discretionary trust.

  7. Accumulation Trust: This trust has provisions that require the trustee to accumulate income until some later date when it is distributed. This trust provision, in combination with protective trust provisions, enables the trust mechanism to be the most efficient and effective estate planning device for minor children, incompetent beneficiaries, or beneficiaries who may be exposed to financial risks or litigation.

  8. Irrevocable Trust: A trust which may not be changed, amended, or revoked, is the Irrevocable Trust. The terms of this trust are permanent. This type of trust should be used only under special circumstances, such as with a life insurance trust (in the United States), and when dealing with situations where completed gifts are required. Generally, irrevocable trusts cannot be used for living or inter vivos trusts situations. Trusts which can be terminated by the Grantor are Revocable Trusts.

  9. Grantor Trust: A trust where, because of the application of United States Income Tax Law, all the income earned by the trust is taxed to the Grantor wether or not distributed. This is a tax classification rather than a traditional trust classification by usage.

  10. Express Trust: An Express Trust exists when the Trust Deed stipulates how the assets are to be managed and when and how capital and income are distributed, although it may be difficult for surpluses to avoid tax claims from the home country. Other tax classifications which have become part of the trust lexicon are Qualified Domestic Trusts (Q-Dot), Qualified Subchapter-S Trusts (QSST), and Qualified Terminable Interest Property (Q-Tip).

  11. Purpose Trust: Designed for a specific, reasonable and plausible purpose, it does not name any individual as a predetermined beneficiary. Instead, by unertaking commercial activity or holding assets in a purpose trust, a company or individual avoids classification as the owner of the commercial activity or trust assets. A purpose trust can be used for: (i) permitting avoidance of regulatory restrictions; (ii) obtaining freedom from liability when undertaking hazardous activites; (iii) facilitating a loan by sequestering assets; and (iv) removing voting control of stock from a company or individual.

  12. Revocable Trust: One that may be cancelled by the grantor under most circumstances. An revocable trust has many applications, including the authority for someone other than the grantor to pay taxes on the income of the trust or to be certain that the capital in trust is preserved for children and grandchildren.

  13. Simple Trust: This is a trust that must distribute all its income; all other trusts are in the category of "complex trusts".

  14. Spendthrift Trust: A trust that prohibits the benficiary from disposing of or assigning an interest to another party. This type of trust may not be attached or otherwise reached by the beneficiaries' creditors.

Trust Company:

A company that is in business to act as a trustee for individuals and other businesses.

Trust Deed (Settlement Deed, Declaration of Trust or Trust Instrument):

The document that lays down the foundations of how the trustees are to administer and manage the trust assets and how they are to distribute and dispose of trust assets during the lifetime of the trust.


Trustees have a fiduciary duty to act in accordance with a trust deed and for the benefit of the beneficiary(ies). See trust.

Trustee in Bankruptcy:

A person appointed as a trustee by a court in a case of bankruptcy. The trustee in bankruptcy takes title to the bankrupt company's assets while they are being disposed of.

Trust Services:

A large number of banks located in tax havens offer trust services. In addition there are trust companies specifically offering trust services. Most tax haven jurisdictions have enacted legislative provisions and set up administrative authorities to control the activities of such banks and trust companies. Services offered by banks and trust companies normally include a fairly wide range of trusteeship, management and related services. The trusteeship services involve not merely acting as trustee of settlements, but many other services such as acting as trustee for debenture holders or as custodian trustee for pension funds, attending to statutory requirements and the maintenance of financial records. Often nominee shareholders, directors and other officers are furnished. Investment services are normally provided.

Turnkey Project:

A large-scale building project where the contractor agrees to see to every detail of the project. The purchaser has only to turn the key when the project is finished in order to take possession.


The total amount of money obtained by an organization for the goods and services that it has sold, less the money that it has paid back for returns.

Two-tier Board:

Any company board that is divided into two parts; as, for instance, in Germany where public companies have both a management board and a supervisory board.


A successful entrepreneur. Someone with fast cars, pretty girls and big cigars as standard accountrements, typified by the hero of The Last Tycoon, F. Scott Fitzgerald's novel about Hollywood in the 1930s.



Ultra Vires:

An action that goes beyond the powers of the organization undertaking it.


Universal Mobile Telecommunications System.


United Nations.


The disentangling of businesses within a conglomerate so that each is run separately as an individual unit.


The acronym for United Nations Conference on Trade and Development, an arm of the UN that aims, in particular, to increase trade between developing countries and the rest of the world.


The provision of insufficient capital for a business to operate without financial strain.

Underground Economy:

Part of an economy that is unrecorded by the tax authorities. It may be unrecorded because it involves a barter transaction, for example, or because it is attempting to evade tax.


There are two meanings:
  1. To assume the risk involved in a new issue of securities. The people who do this (usually banks) are called underwriters.
  2. To take on an insurance risk in return for a premium.


An arrangement by which a company is guaranteed that an issue of shares will raise a given amount of cash because the underwriters, for a commission, agree to subscribe for any of the issue not taken up by the public.


United Nations Development Programme.

Unearned Income:

Any income that is not earned from employement, such as dividends, interest payments and lottery prizes. Some governments treat unearned income for tax purposes.


People who are not employed but would like to be. The long-term unemployed are people who have been unemployed for a continuous period of more than a year.


United Nations Educational Scientic and Cultural Organization.

Unfair Dismissal:

Terminating someone's contract of employment without good cause. Employees thus dismissed have the right to sue their employers for damages.

Unfair Trade:

Trade in goods that have been subsidized in ways that break the rules of one of the international trading agreements.


United Nations Fund for Population and Activities.


United Nations High Commissioner for Refugees.


Union des Industries de la Communauté Européenne.


United Nations Childrens Fund.

Unit Cost:

The cost of producing one unit of a product or service.

Unitary Tax:

A revolutionary form of tax system pioneered by the US state of California. Under a unitary tax system a company is taxed on a percentage of its worldwide profit rather than on the profit which the company claims arose within the fiscal authority's jurisdiction. The percentage may be based on the share of the company's sales that took place in the jurisdiction.

United States Property:

Tangible property located in the United States, stock of a domestic corporation, obligations of United States persons (including the guarantee of such obligations) and the right to use any patents, copyrights, etc. in the United States acquired or developed by a controlled foreign corporation. Assets acquired in normal commercial transactions without any intention of permitting them to remain in the United States, such as accounts recievable, are excluded from United States property.

United States Shareholder:

A United States person (citizen or resident) who owns 10% or more of the combined voting power of all classes of stock entitled to vote, either directly, indirectly or constructively, of a controlled foreign corporation.

Universal Bank:

A bank that is allowed to carry out a wide range of financial services, almost without limit. In most countries banks are restricted by law as to the sort of services they can offer.

Unlimited Company:

A company that does not have the protection of limited liability. The directors of the company are personally liable for all its obligations, without limit.

Unlisted Securities Market:

A market in securities that are not listed on a recognized stock exchange. Such securities are traded informally, and individual buyers generally have to be matched with sellers.

Unquoted Company:

A company whose shares are not quoted on a recognized stock exchange. When there is no quoted market price for a company's shares, marketing them is not easy.


United Nations Relief and Works Agency for Palestine Refugees in the Near East.


To do something that improves the quality or performance of something that already exists; for example, buying more memory for a computer, or improving the credit rating of a company's debt.

Up market:

A marketing term based on a theoretical division of markets into a top, a middle and a bottom. A product aimed to appeal to the top end of the market is said to be upmarket. The division of markets can be based on social class, wealth or lifestyle. Contrast with downmarket.


Universal Postal Union.


An activity that is close to the original raw materials used in a process (particularly in oil refining). Drilling in the desert, for example, is more upstream than the manufacture of petrochemicals.


Universal Resource Locator is a means of identifying an exact location on the Internet. For example, http://www.webtrends.com/html/info/default.htm is the URL which defines the use of HTTP to access the Web page default.htm in the /html/info/ directory on the WebTrends Corporation web site). As the previous example shows, a URL is comprised of four parts: Protocol Type (HTTP), Machine Name (webtrends.com), Directory Path (/html/info/), and File Name (default.htm). Useful Life: The length of time during which an asset produces more than the cost of its upkeep. An indicator of the period over which the asset should be depreciated.

User Group:

A group of consumers who are brought together by a company's marketing department to examine and discuss their attitudes to the company's products and to those of its rivals. A sophisticated form of market research.


Short for unique selling proposition, something a product has which differentiates it from all its rivals. Its USP then becomes a central focus of the product's advertising campaign.


The charging of exorbitant rates of interest for loans. Most developed countries now have laws against usury, although credit-card companies manage to escape them. In Europe such laws can be traced back to the 15th century.


Any company that provides services which are essential to the comfortable running of homes and offices, such as electricity, gas and water.




A subjective measure of worth. What something is worth to its owner. Something that is a valuable piece of information to one person may be worthless to the next.

Value Added:

The value that a process adds to the goods and services it is processing; the amount by which it increases their worth in a market. That is, the price fetched for the output from the process minus the cost of the inputs put into the process.

Value Chain:

The interlinking activities that take place within an organization in the process of converting its inputs into its outputs. Identifying these activities and finding ways to perform them more efficiently is a way for companies to gain competitive advantage over their rivals.

Variable Cost:

A cost that varies in line with the volume of production. For example, the cost of steel is a variable cost in the production of automobiles; the cost of heating the factory is not.

Variable Rate:

A rate of interest which changes in line with some benchmark figure. The extent and frequency with which the rate changes is laid down (for example, no more than once every six months, and then by less than two percentage points). Contrast with floating rate, which has no limits to its fluctuation.


Short for Value Added Tax, an ad valorem tax based on the government imposed tax on goods and services.

Venture Capital:

Money that is put up by a financial institution or wealthy individual to back a risky project, either in its early stages or when it needs a new injection of capital. Because of the high risk involved, venture capital expects a higher rate of return than that obtained from normal equity.


Germany's version of chapter 11, a breathing space for companies in financial dificulty. Vergleich allows them to write off some of their debts if they meet payment terms agreed with their creditors.

Vertical Integration:

The integration of businesses whose activities follow each other sequentially. If a garment manufacturer were to buy a spinning mill or a garment shop, it would be an example of vertical integration. Likewise, a food manufacturer that buys a chain of grocers.

Vicious Circle:

A sequence of events, each of which leads on inevitably to a worse situation, and each of which triggers another such event. Late payment by a customer, for instance, might lead to the need for a new bank loan, which might lead to an unfavourable credit rating, which might lead to a vicious circle. Contrast with virtuous circle.


A way of communicating between groups of people in remote places via the telphone and television. A videoconference has the added bonus, compared with a teleconference, of allowing the participants to see each other in real time as well as to hear each other.

Vintage Company:

See Shelf Company.


Creating the attributes of something without actually creating the thing itself. A virtual office, for example, does not exist in an office building. It exists in a travelling salesman's hotel room when he links up his computer to his colleagues' and starts working as if he were in an office. A virtual corporation is a company with a large turnover, virtually no premises and few staff.

Virtuous Circle:

A sequence of events which leads from good to better. Each of the events triggers another which improves things even more. Contrast with vicious circle.

Virtuous Circle:

A sequence of events which leads from good to better: Each of the events triggers another which improves things even more. Contrast with vicious circle.


A computer program which destroys computer data and other programs. Viruses can be introduced into a computer via any link with the outside world: a floppy disk, a modem link, or a CD.


A stamp or endorsement usually placed in a passport by a consulate allowing a person to enter a country for a certain period of time.

Visible Trade:

Trade between countries in manufactured goods; things that can be seen, such as cars and computers, rather than insurance policies and room service.


A lofty and far-seeing aspiration that a company puts in writing in order to inspire its employees into working for something above and beyond their daily wages.

Visitor Visa:

Visa that allows a tourist to enter a country for the purpose of travel.

Voice Mail:

A telephone system which allows each individual within an organization to have a phone that can receive recorded messages from incoming callers when individuals are away from their desks. A sort of networked answerphone.


The voice which is added to a filmed advertisement, in a recording studio, after the film has been made.

Voice Recognition:

The ability of an electronic device to distinguish the sound of an individual human voice. Voice-recognition technology has many potential uses, such as accessing bank accounts and computers.


The extent to which something is liable to fluctuate violently and frequently, especially the price of shares, currencies and loans.

Volume Discount:

A discount given to a buyer that is related to the volume of goods that the buyer purchases. For example, if a single item costs $100, but buying ten of the items costs only $900, there is a volume discount of 10%.

Voting or Pooling Agreement:

A voting or pooling agreement is an agreement, preferably in writing, of two or more shareholders to vote their shares in a certain manner. The most common use of this agreement would be to pool voting strength for the election of directors.

Voting Rights:

Rights enabling the holder of a share in a company to vote on issues raised at the company's general meetings.

Voting Trust:

A voting trust is an agreement among the shareholders of the corporation. Under a voting trust, shareholders transfer their shares of stock to a trustee in exchange fo




The monetary reward for labour.

Wage Freeze:

The halting (or limited) by a government of wage increases throughout an economy, once a popular way of attempting to control inflation.


An organized stoppage of work by a group of employees in an attempt to obtain improved working conditions and/or wages.

Wall Street:

The street on Manhattan Island where the New York Stock Exchange is situated, a name that has become a synonym for financial markets in general, and for American capitalism in particular.


Wireless Application Protocol - gives your mobile phone access to the Internet.


There are two meanings:
  1. The physical place where a company stores its stock (inventory). Such places are usually on the outskirts of big towns, where property prices are low, but close to arterial transport routes.
  2. To buy shares in a company in the names of nominees in order to disguise the fact that a connected group of investors is building up a alrge stake.


A certificate entitling its holder to buy shares in a company at a future date and at a prescribed price.


A guarantee given by a seller of goods that the goods will perform as promised. Warranties have a finite life and do not cover damage that is not the fault of the manufacturer.

Waste Management:

The systematic management of the waste products created by an industrial process; that is, products which are surplus to the process in question. Some waste products can be recycled into different manufacturing processes; others can be used directly as by-products; and others need to be broken down into biodegradable substances.

Wasting Asset:

A fixed asset with a finite useful life, such as a machine that eventually wears out, or a gold mine that is eventually exhausted.


An officially appointed body (or person) that watches over the activity of an industry to see that it is not, for instance, anti-competitive or in some other way against the public interest.


A document accompanying a shipment of goods that sets out the route that is to be followed by the goods and the cost of the shipment.

Web Payment Services (WPS)

While the bulk of Internet e-commerce is still transacted using credit cards, there has been steady inroads being made by alternative methods of settling e-transactions. These Web Payment Services (WPS) have ingeniously utilized the most popular application on the Internet "e-mail", to appeal to customers.

By using an existing platform to launch their services, WPS providers have enjoyed wide appeal with customers worldwide. The largest of these, http://www.PayPal.com , has approximately 11 million users, processes 150,000 payments per day, and attracts over 20,000 new users per day. The following also provide WPS services: http://www.c2it.com , http://www.WesternUnion.com , http://www.BillPoint.com

Web Site:

An electronic site on the world wide web where a company, or an individual, lays out information about itself. Each web site has a unique address. Individuals with access to the internet can key in to that address and gain access to the information on the site.


An employee who alerts the authorities to the fact that his or her employer is engaged in illegal activity. Whistleblowers sometimes have special protection under the law.

White Collar:

A term used to refer to those workers in an organization who wear a white collar, that is, a smart shirt and tie rather than a set of overalls. It is a similar distinction to that between staff and line workers.

White Goods:

Electrical consumer goods that are traditionally encased in white enamel,such as refrigerators and washing machines.

White Knight:

An investor who comes to the rescue of a company that is subject to a hostile takeover.


Ther purchasing of large volumes of goods direct form manufacturers in order to sell them in smaller volumes to retailers.

Wildcat Strike:

A sudden and unofficial strike by a group of employees that is not recognized by the employees' trade union. A wildcat strike may beginwith a walkout.

Windfall Profit:

A sudden and unexpected profit that is not a result of the conscious effort of the beneficiary. For example, the compulsory purchase of waste land by a government for the purposes of roadbuilding might result in a windfall profit for the landowner.

Winding Up:

The process of closing down a company, selling off its assets and removing it from official records.

Window Dressing:

The deliberate tarting up of a company's accounts to make them look as attractive as possible to investors, employees and others. Window dressing need not be illegal. For a number of items that appear in accounts there is no single correct method of valuation.

Window of Opportunity:

A short period of time in which the conditions for carrying out a particular task are highly favourable. There may, for example, be a window of opportunity for a company to issue new shares; a time when the stockmarket is briefly able to fetch a high price for the shares.

Wirtschaftlich Beguenstigter:

Person who is the ultimate beneficiary of a company or trust. This term is used in Switzerland and Liechtenstein.

Withholding Tax:

Tax required to be deducted at source by companies paying interest, dividends or royalties, but which may in certain circumstances be reclaimed by the recipient or be reduced under a double taxation agreement/tax treaties

Word Processor:

A simple sort of computer that carries out the functions of a typewriter, but more quickly.

World Wide Web:

The computer software that allows a person sitting in front of a PC to gain instantaneous access to electronic information provided by organizations thousands of miles away via the internet.

Work in Progress:

All the semi-finished goods that exist within a business and are on their way towards becoming finished goods. Also, the value of all those goods which is shown in the company's accounts as an asset. Referred to in the United States as work in process.

Work Permit:

An official permit given by a government to people who are not citizens of that government's country, allowing them to take up formal paid employment within the country.


A place within an office or a home that is equipped with the tools needed to do a particular job, espceially one that requires the use of a computer, modem and telephone. A workstation can also be the place where a carpenter does his work.


A refusal by employees to do work that falls outside the terms of their contract, strictly interpreted. This means, for instance, that they refuse to work overtime. The work-to-rule is a common tactic used in industrial disputes.


The total of all employees in either an industry or an individual company. The same as labour force.

Working Capital:

A firm's current assets minus its current liabilities.


A quantitative measure of the amount of work that an individual is expected to do in a particular job during a fixed period of time.

Write Down:

To reduce the value of an asset in the books of a company.

Write Off:

To reduce to zero the value of an asset in the books of a company.


Short for World Trade Organization, a Geneva-based organization that acts as a kind of watchdog for the world's trading system. It oversees the enforcement of the GATT.






The last day of an accounting period, the day on which the books are brought to a close. Transactions before that day are taken into accounts; transactions after it are (by and large) not.


The rate of output of any of the factors of production (that is, of land, labour or capital). Land yields, for example, are measured by the amount of crop produced per hectare; the yield on share capital is measured by the amount of dividend paid.

Yield Curve:

A graph showing the different yields that are obtained from financial instruments of the same quality but of different maturity. A yield curve plots the yield of the instruments against their maturity.




Huge industrial conglomerates built up in Japan as the engine of the country's industrial revolution, groups such as Mitsubishi and Sumitomo. Each zaibatsu invariably embraces a bank and a sogo shosha. Although disbanded after the second world war, many zaibatsu have been reformed since.


The practice of using a remote-control device to switch from one television channel to another, particularly to avoid having to watch advertisements. Zapping has a powerful influence on the effectiveness of television advertising.

Zero-base Budgeting:

A method of drawing up a budget which starts from zero; that is, it assumes that there was not budget at all in previous years. This avoids the trap of slavishly following what was decreed to be a correct figure in a previous period, and then updating it by adding 10%.

Zero-Coupon Bond:

A bond which does not pay any interest. A zero-coupon bond is sold at a deep discount to its face value. The owner's gain comes from the gradual appreciation of the bond. On maturity it will be redeemed at its face value.

Zero Defects:

To have no errors in a product or process – a common aim of TQM.

Zero-sum Game:

Any game in which the gains to the winner (or winners) are equal and opposite to the losses of the loser (or losers). Gambling is a zero-sum game; business is not. A new entrant to a market can have the effect of increasing the size of the market in such a way that all the participants in it benefit.