Glossary
Acceptance Confirmation by the drawee of a
bill of exchange that it will pay the amount
stated on the face of the bill on the due
date stated. This is effected by way of the
drawee’s signature on the front of the bill,
often accompanied by the word ‘accepted’,
and confirms an unconditional obligation on
the drawee’s part.
Accepted A draft (bill of exchange) that has
been accepted by the drawee (also known
as the acceptor).
Acceptor A drawee who confirms his debt
by signing his acceptance on a bill of
exchange.
Acceleration Clause When a lender has the
right to demand the immediate repayment
of all outstanding debt in the case of default
under a loan agreement. This acceleration
clause is included in most debt and
derivative agreements.
Acceptance Credit A facility provided by banks
to their corporate customers where the
corporate customer draws a bill of exchange
that is accepted by the bank and discounted.
Acceptance credits allow short-term financing
of national or international trade transactions.
Accounts Payable (A/P) Short-term/current
liabilities resulting from the purchase of
supplier goods and services.
Accounts Payable (Payables)
Management The different strategies that
allow companies to manage the cost of
the liabilities resulting from the purchase of
goods and services.
Accounts Receivable Short-term/current
assets resulting from the extension of trade
credit on goods or services delivered.
Accounts Receivable Management The
different strategies that can be adopted
to manage the collection of outstanding
receivables.
Advance Payment Bond See advance
payment guarantee.
Advance Payment Guarantee A written
promise that a product/service will be
provided in exchange for a payment made in
advance of the actual purchase.
Advance Payments (or Payments in
Advance) Payments effected by the lessee
at the beginning of the leasing period.
Advising Bank In transactions involving letters
of credit (L/C), the advising bank is the bank
advising the beneficiary (exporter) that an
L/C has been opened in its favour.
After Date A notation used on drafts (bills of
exchange) to fix the maturity date as a fixed
number of days past the date of the drawing
of the draft.
After Sight The maturity of a draft, whereby
payment is due at the end of a specified
term after the presentation of specific
documents and acceptance of the draft.
Air Waybill (AWB) Similar to a bill of lading, it is
used for the transport of goods by air. Unlike
a bill of lading, it does not offer title of the
goods. The exporter can exercise his ‘right
of disposal’ at any time by presenting his
copy of the air waybill to the airline and, as
such, he can: stop the goods at any point of
their journey; have the goods delivered to a
different consignee from the one mentioned
in the air waybill; or have the shipment
returned. Nevertheless, it allows the importer
to collect the goods against identification.
Allonge An additional piece of paper attached
to a negotiable instrument used for adding
additional endorsements when there is not
sufficient space on the instrument itself.
ALOP (Advance Loss of Profits)
Insurance The insurance of revenue from
projects under construction. Also known as
DSU (delay in start-up) insurance.