Introduction to Accounting and Stakeholder Management

Vocabulary flashcards covering key financial terms, financial statements, firm theories, stakeholder mapping, and stakeholder relationship postures based on the lecture.

Current Maturities of Long Term Debt (CMLTD)

The portion of a long-term loan or debt that is due to be paid within one year.

Gross Profit

The profit a company makes directly from manufacturing and selling its product.

Operating Profit

The profit remaining after subtracting all operating, selling, general, and administrative expenses that do not directly relate to making the product.

Working Capital

A measure of operational liquidity calculated as $\text{Working Capital} = \text{Current Assets} - \text{Current Liabilities}$.

Absorption Time

The time needed for students or individuals to internalize and process new information for long-term retention.

Ownership Theory of the Firm

A business framework asserting that a firm's primary objective should be to maximize shareholder value and make money for the owner.

Stakeholder Theory

A management concept stating that a company should consider the interests of all relevant stakeholders when making decisions.

Stakeholder Map

A tool used to map relevant stakeholders based on their degree of power and their stance (support or opposition) regarding a specific issue or decision.

Inactive Relationship

A stakeholder relationship approach where a business does not actively interact with a particular stakeholder group because they have low interest or low power.

Reactive Relationship

A stakeholder relationship approach where a company acts or responds only after experiencing external pressure from stakeholders or public issues.

Proactive Relationship

A stakeholder relationship posture where a business anticipates potential issues in advance and takes affirmative steps to fix them.

Interactive Relationship

A stakeholder relationship posture involving ongoing, continuous dialogue with stakeholders to determine their interests and needs.