Trade is a complicated business. Every trade involves multiple parties, each with their own knowledge and terms. Fortunately, globalization necessitates international trade, which has standardized many trade terms. In order to assist our members in understanding them, we have compiled a list of important trade terms.
TRADE TERMS
Asymmetrical information - Asymmetric information, also known as "information failure," occurs when one party to an economic transaction possesses greater material knowledge than the other party.
Auditability - Auditability refers to the ability of an auditor to achieve a comprehensive examination of the financial records and financial statements of a client. An audit engagement has a higher level of audibility when the following conditions are present: The client's financial records are well-organized and complete.
Bridge Financing - Bridge financing is short-term financing, sometimes referred to as private money or hard money. Bridge loans are typically made by private individuals and not banks, so the interest rates on bridge loans are higher than bank loans. Kountable provides bridge financing when purchasing goods on behalf of the reseller
Corporate Treasury - Corporate treasurers undertake a range of risk, strategic, and/or general financial management activities that enable companies to maintain or improve/maximise their financial position.
Domiciliation Account - A domiciliation is a financial agreement between you and your customers, allowing you to automatically collect the payments for customer's invoices through a preferred bank account.
Due Diligence - General: Measure of prudence, responsibility, and diligence that is expected from, and ordinarily exercised by, a reasonable and prudent person under the circumstances.
Freight Forwarder - A freight forwarder acts as an agent when he performs functions on behalf of, and under the instructions of, the principal (the exporter or importer). As an agent, the forwarder will procure the services of third parties who will perform the packing, storage, transport, handling, and customs clearance of the goods.
FX Risks - Foreign Exchange risk refers to the losses that an international financial transaction may incur due to currency fluctuations.
Global System of Record - A system of record (SOR) is an ISRS (information storage and retrieval system) that is the authoritative source for a particular data element in a system containing multiple sources of the same element. To ensure data integrity, there must be one -- and only one -- system of record for a given piece of information.
Know Your Customer (KYC) - KYC is an abbreviation for Know Your Customer and can refer to government regulations designed to prevent money laundering, financing terrorism, and other crimes involving money.
Last-Mile Logistics - The last mile is a term used in supply chain management and transportation planning to describe the movement of people and goods from a transportation hub to a final destination in the home.
Procurement - The act of obtaining or buying goods and services. The process includes preparation and processing of a demand as well as the end receipt and approval of payment. It often involves purchase planning, standards determination, specifications development, supplier research and selection, value analysis, financing, price negotiation, making the purchase, supply contract administration, inventory control and stores, and disposals and other related functions. The process of procurement is often part of a company's strategy because the ability to purchase certain materials will determine if operations will continue.