Chapter 12

• Asset turnover ratios - Ratios that focus on capturing how efficiently a company uses its assets.
• Board of directors - A body elected by the shareholders to represent their interests and responsible for maintaining
the integrity of the company's financial reports.
• Component percentage - A figure that expresses each item on a particular financial statement as a percentage of a
single base amount.
• Corporate governance - The procedures designed to ensure that the company is managed in the interests of the
corporation's stakeholders.
• Earnings forecasts - Predictions of earnings for future accounting periods.
• Institutional investors - Managers of pension funds, mutual funds, endowment funds, and other funds that invest
on behalf of others.
• Lenders (creditors) - Suppliers and financial institutions that lend money to companies.
• Liquidity ratios - Ratios that measure a company's ability to meet its short-term obligations.
• Market ratios - Ratios that tend to measure the market worth of a common share.
• Press release - A written public news announcement normally distributed to major news services.
• Private investors - Individuals who purchase shares in companies.
• Profitability ratios - Ratios that compare net earnings with one or more primary activities.
• Ratio analysis - An analytical tool that measures the proportional relationship between financial statement
amounts.
• Solvency ratios - Ratios that measure a company's ability to meet its long-term obligations.
• Unqualified (clean) audit opinion - The auditors' declaration that the financial statements are fair presentations in
all material respects in conformity with IFRS.