What is the Altman Z Score ? The Altman Z-Score a formula used to determine the financial condition of the company and its probability of bankruptcy.  What is the Altman Z-Score Formula? There are 4 distinct Z-Score formulas customized for the type of business being assessed. The formulas include: Public Manufacturing Company Z-Score = 1.2A + 1.4B +...

What is the Income Approach to Valuation? There are many valuation methods and appraisal approaches that evaluators use when determining the fair market value of a property. The income approach is a valuation method used by appraisers to estimate the fair value of a property. The income approach is also called the income capitalization approach. To ...

What is an Aggregator Model? An Aggregator Model is a networking E-commerce business model where a firm, known as an Aggregator, collects (or aggregates) data pertaining to goods and/or services offered by several competing websites or application software (commonly known as apps) and displays it on its own website or application software.  Typicall...

What is an Overseas Private Investment Corporation? An Overseas Private Investment Corporation (OPIC) is a government body of the United States which was established in 1971, that offers medium to long-term funding for projects in developed and emerging markets, including homes, hotels, airports and natural resource exploration for American companie...

What is Times Interest Earned? Times interest earned (TIE) is used to measure if a company can pay up its debts or not. This calculates the number of times a company can pay up its interest charges before the deductions of tax. It is basically calculated by estimating the earnings of a company before its interest and tax rates (EBIT). This is then d...

What is an issuer allowed to do during the Post-Effective Period? During the Post-Effective Period, the issuer can begin selling securities. The issuer must still deliver a statutorily prescribed prospectus to offerees. Additional rules benefiting WKSIs exist during this stage that allow for an automatic shelf registration. Shelf registration is the...

What is a Shelf Registration? Shelf registration is a procedure in which an issuing companies files or registers a security offering that is to be offered in the public market with the Securities and Exchange Commission (SEC). In the United States, one of the ways issuers comply with the SEC registration requirements for a new security offering is t...

What is Committed Capital? Committed capital is an agreement, based on a legal contract, between a private equity fund and an investor. The investor is then obligated to keep contributing money towards the private equity fund or the venture capital fund. The investor has the option of paying committed capital in a lump sum or make little contributio...

What is Human Capital? Human capital refers to the value of human skills, knowledge, and experience within an organization.  Human capital is an intangible asset that comprises of worker's education, training, expertise, intelligence, loyalty, and knowledge.   Companies invest in human capital by providing quality training, education and experience ...

What is the Lipstick Effect? Lipstick effect is a term used to refer to a situation where consumers still manage to buy a luxury product like lipstick, amid an economic crisis. When there is a recession, consumers are expected to focus their purchase on goods that don't impact their already limited income. However, some consumers still have the cash...