GLOSSARY

Factoring

A way of gaining faster payment of customers' bills. Invoices are handled by a specialist factoring company who pay you a percentage of face value and pursue payment by your customers.

Financial Year

The financial year is the period covered by the accounts. For a new company, or business, it starts on the date of incorporation, regardless of when the company actually starts doing business, for a business it starts when the business starts to trade. For companies which have previously delivered accounts, it starts from the day after the period covered by the earlier accounts.

The financial year ends on the company's accounting reference date or, if the company wishes, on a date up to 7 days either side of the accounting reference date. A particular financial year can be less or more than 12 months, but it cannot be more than 18 months.

Fixed Costs

Also known as running costs, indirect costs or overheads and are the costs incurred in running your business - whether you sell or not - they include things such as telephone, rent, rates, heat, light, vehicle running costs, business insurance, depreciation on capital equipment, consumables, advertising, stationery, etc. by deducting fixed costs from your gross profit you will have a net profit (taxable)

Framework Conditions Benchmarking

The methodology for benchmarking the key elements that affect the environment in which businesses operate.

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