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The A to Z Glossary of Credit Keywords

There are 166 entries in this glossary.
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Term Definition
Days Sales Outstanding:

See D.S.O.


A document recording the indebtedness of one party to the other, containing a promise to repay and, by way of security for that promise, a floating charge over a company's assets.

Debt collection agency

A company which operates a debt recovery service for the recovery of overdue accounts, on behalf of clients.


Scottish equivalent of an English Judgment.

Discretionary limit

Under credit insurance this is the maximum amount of business that can be transacted with any one buyer without the formal approval of the insurer, subject to satisfactory credit references being obtained.


The return paid to shareholders on their investment. (Usually in the form of a bonus payment every six months).

Document of title

A document enabling the person in possession of it to deal with the property described in it in any way as if they were the owner.

Dormant company

A limited company that has never started, or has ceased, its trading activities (e.g. a subsidiary transferring its business to its parent or a fellow subsidiary), but has not been dissolved. Annual returns are still filed, but the accounts state that the company did not trade during the year. A company is kept on the 'live index' in this way, so that it can be easily reactivated if it wants to start trading again in the future. It is also known as a Shell company.

Due from group companies

Amounts due from group companies within the next 12 months e.g. repayment of a short-term loan.

Earnings report/statement

A business financial statement that lists revenues, expenses, and net income throughout a given period. Because of the various methods used to record transactions, the monetary values shown on an income statement often can be misleading. Also known as Profit and loss statement, Operating statement, or Income statement.


Once a debt has been sued for successfully and judgment entered against the debtor there are various methods of physically recovering the money and those are enforcement methods. Examples are instructing bailiffs to levy execution, charging orders, attachment of earnings, Third Party Debt Orders.


Factoring is a financial service by which a concern operating as a 'Factoring House' or 'Factoring Agency' will buy outright the debts of a client. The latter is then relieved of losses it may incur because of slow payment or financial difficulties of a customer and the trouble of collecting outstanding accounts.


A business unit formed for the purpose of carrying out some kind of trading activity. The term "firm" is used in many ways, but the correct meaning is a business carried on under a trading style by partners. Many people use the term "firm" to embrace any business, i.e., Private Limited and Public Limited companies but this is technically incorrect.

Fixed assets

Tangible and intangible assets with a relatively long life, acquired to produce goods or services and not intended for resale. Includes financial assets such as trade investments.

Fixed charge

A charge over a specific asset or type of asset, e.g. machinery, property, book debts, etc.

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