From emerging regulation to deal mechanics, we write about the questions founders and investors actually ask — practical analysis you can put to work.
Current liabilities are obligations a company expects to settle within 12 months of the reporting date — recorded on the balance sheet below current assets under IFRS (IAS 1) and US GAAP (ASC 210). They are the short-term claims against the business by creditors, suppliers and the tax authority.
Current assets are balance sheet assets a business expects to convert to cash, sell or consume within 12 months of the reporting date. Under IFRS (IAS 1) and US GAAP (ASC 210), they are listed in order of liquidity at the top of the asset section.
Cost structure is the composition and proportion of fixed and variable costs that a business incurs to deliver its product or service.
Cost of Goods Sold (COGS) — sometimes called cost of revenue or cost of sales for services businesses — is the direct cost of producing the goods or delivering the services a company sells in a period.
Cash flow is the net movement of cash into and out of a business over a period. The statement of cash flows (IAS 7 / ASC 230) reconciles accrual net income to the change in cash on the balance sheet by walking through three activity buckets.
Cash basis accounting recognises revenue when cash is received and expenses when cash is paid — regardless of when the underlying economic activity occurred.
Capital is the financial resources a business uses to fund its operations and growth — sourced primarily from equity (shareholders) and debt (lenders). Capital appears on the right-hand side of the balance sheet as a claim against the assets that produce future cash flows.
Business-to-Consumer (B2C) describes companies that sell directly to individual end-consumers — as opposed to Business-to-Business (B2B) companies that sell to other businesses.
Business-to-Business (B2B) describes companies that sell products or services to other organisations — as opposed to B2C companies selling to individual consumers.
A business plan is a written document that describes a business’s strategy, operations, market context and financial projections — typically covering 1, 3 or 5 year horizons.
