What is a Currency Swap Contract? A currency swap contract (also known as a cross-currency swap contract) is a derivative contract between two parties that involves the exchange of interest payments, as well as the exchange of principal amounts in certain cases, that are denominated in different currencies. Although currency swap contracts generally imply the…
What is an Equity Swap Contract? An equity swap contract is a derivative contract between two parties that involves the exchange of one stream (leg) of equity-based cash flows linked to the performance of a stock or an equity index with another stream (leg) of fixed-income cash flows. In equity swap contracts, the cash flows…
What is Review Engagement? A review engagement is also known as a limited assurance or negative engagement. Auditors conduct a review engagement after an accountant’s completed an audit of a company’s financial statements, and therefore, the auditor provides limited assurance on the accuracy of the financial statements. During the engagement, the auditor performs inquiry and…
What is a Compilation Engagement? A compilation engagement is a service provided by an outside accountant to assist the management in the presentation of financial data in the form of financial statements. The accountant should possess a greater knowledge of the operations of the business in order to compile the financial statements. In some cases,…
What are Retail REITs? Retail REITs are a type of REIT that owns and manages retail properties in central business districts and upmarket areas. It leases the retail space to tenants looking to set up shopping malls, grocery stores, boutiques, etc. Retail REITs make money by leasing space to tenants, who pay monthly, quarterly, or…
What is Credit Report Analysis? Credit report analysis involves evaluating the information contained in a credit report, such as the personal details of a customer, their credit summary, any inquiries made, foreclosures and repossessions, and public records on bankruptcies. A credit report provides a credit record of an individual or corporate entity. It helps the…
What are Credit Analyst Skills? An individual needs to possess key credit analyst skills in order to be effective in the role. A credit analyst is required to assess a loan application to determine the creditworthiness of a client and make recommendations on whether or not to lend. For a credit analyst to perform his/her…
What are Commercial Properties REITs? Commercial properties REITs are real estate investment trusts that specialize in commercial properties. The REITs operate like mutual funds, where investors contribute funds to a central pool to purchase commercial properties. It gives them the required exposure to commercial real estate investments without having to buy properties on their own….
What is the Herfindahl-Hirschman Index (HHI)? The Herfindahl-Hirschman Index is an index that measures the market concentration of an industry. A highly concentrated industry is one where only a few players in the industry hold a large percentage of the market share, leading to a near-monopolistic situation. A low degree of concentration means that the industry is…
What is the Cash Flow to Debt Ratio? The cash flow to debt ratio is a coverage ratio that compares the cash flow that a business generates to its total debt. The cash flow most commonly used to calculate the ratio is the cash flow from operations, although using unlevered free cash flow is also a viable…
