Financial Systems and Governance

A collection of flashcards covering key concepts and terms related to financial systems, governance, and the interactions individuals have within these frameworks.

Financial Systems

Structures comprising institutions, markets, and instruments that facilitate the flow of funds and information.

Governance Framework

A system that identifies who makes decisions and the processes involved in managing institutions.

Stakeholders

Individuals or groups who have an interest or investment in a particular institution or system.

Accountability

The obligation to explain, justify, and take responsibility for one’s actions, particularly within governance.

Regulations

Rules or directives made and maintained by an authority, particularly in the context of financial systems.

Trust

A firm belief in the reliability or truth of someone or something; essential for functioning financial markets.

Private Sector

The part of the economy that is run by individuals and companies for profit, as opposed to the government.

Risk Sharing

A financial practice where parties involved share the risks associated with investments.

Nominal Interest Rate

The stated interest rate on a loan or investment without adjusting for inflation.

Present Value (PV)

The current worth of a cash flow or series of cash flows, given a specified rate of return.

Future Value (FV)

The value of an investment after a specified amount of time at a given interest rate.

Bylaws

The rules governing the internal management of an organization.

Corporate Ethics Codes

Guidelines for maintaining ethics and integrity in business practices.

Financial Institutions

Organizations that provide financial services, such as banks and insurance companies.

Central Banks

National banks that provide financial and banking services for their country and manage the nation's currency.

Leverage Ratio

A financial ratio that indicates the proportion of debt held by an entity relative to its equity.