Essential English for Finance and Accounting

English Finance Vocabulary

Mastering financial terminology is essential for professional communication. Below is a comprehensive list of terms used in accounting and finance.

Core Accounting and Finance Terms

• Assets (Activos/Bienes): Anything owned by a company, such as cash, buildings (edificios), and machines (máquinas).
• Expenditure (Gasto): The money that a company spends.
• Cost Accounting (Contabilidad de costos): Determining the unit cost of a manufactured product, including indirect costs.
• Liabilities (Pasivo): Money that a company will have to pay to someone else.
• Income (Ingresos): The money that a company receives from supplying goods or services.
• Bookkeeping (Libro de contabilidad): Recording transactions (purchases and sales) in ledgers.
• Auditing (Revisión de cuentas): The use of a company's accounting data by its managers for planning and control.
• Accounting (Contabilidad): The general process of recording and reporting financial transactions.

Types of Accounting Practices

It depends on the specific needs of the user; there are three primary types of accounting:

• Tax Accounting (Contabilidad tributaria): Calculating how much tax an individual or company should pay. It helps determine how much is owed to the government and follows rules set by the government.
• Financial Accounting (Contabilidad financiera): Checking and evaluating financial records. It is designed to help people outside of the business (such as creditors, investors, and suppliers) make decisions through multi-purpose reports (informe multipropósito).
• Management Accounting (Contabilidad de gestión): Keeping financial records and preparing financial statements. It is designed to help people inside the business make decisions and meet the specific needs of internal users.

Market and Investment Vocabulary

• Credit Crunch: Contracción del crédito
• Venture Capital: Capital de riesgo
• Feedstock: Materia prima
• Drop: Soltar / Caída
• Shift: Cambio
• Discourage: Desalentar
• Slump: Depresión / Caída brusca
• Capital Budgeting: Presupuesto de capital
• Stock Certificate: Certificado de acciones

Financial Statement Components

• Fee: Cuota (e.g., net fee and commission income).
• Premium: Prima
• Net: Neto
• Consolidate: Consolidar
• Profit before tax: Beneficio antes de impuestos
• Operating expenses: Excluding amortization of intangible assets.
• Net premiums: From insurance contracts.
• Total income: Net of insurance claims.
• Amortization of intangible assets: Amortización de activos intangibles

Key Definitions and Concepts

• Commission: A charge for arranging a transaction.
• Fee: A charge for service performed by a bank.
• Premiums: Payments for an insurance policy.
• Amortization: A reduction in the value of an asset charged against profits.
• Net: An adjective meaning after all deductions have been made.
• Consolidated: An adjective meaning for whole groups of companies.
• Short-term: An adjective meaning one year or less in financial statements (corto plazo).
• Minority Interests: Part-ownership (less than 50%) of other companies.
• Intangible Assets: Things of value that cannot be physically touched, such as reputation, goodwill, brand names, and trademarks.
• Shareholders' Equity: The net worth of a company; the amount by which assets exceed liabilities.