DECA terms

Question 1

Accounting

Answer 1

The practice and body of knowledge concerned with recording transactions, keeping financial records, performing audits, advising on taxation issues, and reporting financial information.

Question 2

Audit

Answer 2

Process that occurs in order to verify that a company is in fact in compliance with the applicable rules and regulations. This involves the sometimes uncomfortable scrutinization of a company’s documents and operations.

Question 3

Break Even Point

Answer 3

Occurs when the inputs and outputs of a business are equal and a profit is being neither made nor lost.

Question 4

Capital Gain or Loss

Answer 4

The difference between the sales price and the purchase price of an asset; this could be either positive or negative.

Question 5

Compliance

Answer 5

Conforming to a rule, policy, standard, or law.

Question 6

Corporate Responsibility

Answer 6

Requirements imposed to ensure that a company is acting responsibly and ethically.

Question 7

Cost Accounting

Answer 7

Helps advise managers on the best course of action based on cost efficiency and capability.

Question 8

Data Mining

Answer 8

The automatic or semi-automatic computational process of discovering patterns in large data sets.

Question 9

Dodd-Frank Reform Act

Answer 9

Legislation which brought the most significant changes to financial regulation since the regulatory reform during the Great Depression.

Question 10

Ethics

Answer 10

Relates more to whether a company has a code of conduct or a code of values that describe the way in which the company and its employees are expected to act and behave.

Question 11

Federal Trade Commission

Answer 11

An agency of the United States government that focuses on promoting a competitive market and protecting consumers from false advertising and unfair business practices.

Question 12

Financial Statement

Answer 12

Documentation that provides information about the performance and changes in the fiscal position of an enterprise.

Question 13

Gramm-Leach Bliley Act

Answer 13

This legislation requires financial-service providers to explain their information-sharing practices and to safeguard sensitive data.

Question 14

Insurance

Answer 14

Traditional risk-financing tool used to transfer the financial hazard of risk.

Question 15

Opportunity

Answer 15

The possibility that an event will occur and positively affect the achievement of objectives.

Question 16

Regulation

Answer 16

Has the same force of law as a traditional piece of legislation; they are rules that an authoritative body, such as a federal agency, created. Failure to comply will result in facing penalties or other consequences.

Question 17

Risk

Answer 17

A probability or threat of damage, injury, liability, loss, or any other negative occurrence that is caused by external or internal vulnerabilities, and that may be avoided through preemptive action.

Question 18

Risk Management

Answer 18

Policies, procedures, and practices involved in the identification, analysis, assessment, and control of any negative occurrence in an effort to mitigate or eliminate such hazards.

Question 19

Risk Management Policy

Answer 19

An organization’s written statement that sets out its approach to an appetite for any hazard or negative occurrence.

Question 20

Sarbanes-Oxley Act

Answer 20

Legislation passed in 2002 by Congress that requires significantly tighter responsibilities for corporations when reporting financial statements, and it also requires a company’s CEO or CFO to certify all external financial reports.