OCCUPATIONAL ENGLISH FOR ACCOUNTING - METHODS OF PAYMENT

 

Methods of Payment

 

To succeed in today’s global marketplace and win sales against foreign competitors, exporters must offer their customers attractive sales terms supported by the appropriate payment methods. Because getting paid in full and on time is the ultimate goal for each export sale, an appropriate payment method must be chosen carefully to minimize the payment risk while also accommodating the needs of the buyer. As shown in figure 1, there are five primary methods of payment for international transactions. During or before contract negotiations, you should consider which method in the figure is mutually desirable for you and your customer.

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Last Published: 4/28/2016

Key Points

• International trade presents a spectrum of risk, which causes uncertainty over the timing of payments between the exporter (seller) and importer (foreign buyer).
• For exporters, any sale is a gift until payment is received.
• Therefore, exporters want to receive payment as soon as possible, preferably as soon as an order is placed or before the goods are sent to the importer.
• For importers, any payment is a donation until the goods are received.
• Therefore, importers want to receive the goods as soon as possible but to delay payment as long as possible, preferably until after the goods are resold to generate enough income to pay the exporter.

Cash-in-Advance
With cash-in-advance payment terms, an exporter can avoid credit risk because payment is received before the ownership of the goods is transferred. For international sales, wire transfers and credit cards are the most commonly used cash-in-advance options available to exporters. With the advancement of the Internet, escrow services are becoming another cash-in-advance option for small export transactions. However, requiring payment in advance is the least attractive option for the buyer, because it creates unfavorable cash flow. Foreign buyers are also concerned that the goods may not be sent if payment is made in advance. Thus, exporters who insist on this payment method as their sole manner of doing business may lose to competitors who offer more attractive payment terms.

Letters of Credit
Letters of credit (LCs) are one of the most secure instruments available to international traders. An LC is a commitment by a bank on behalf of the buyer that payment will be made to the exporter, provided that the terms and conditions stated in the LC have been met, as verified through the presentation of all required documents. The buyer establishes credit and pays his or her bank to render this service. An LC is useful when reliable credit information about a foreign buyer is difficult to obtain, but the exporter is satisfied with the creditworthiness of the buyer’s foreign bank. An LC also protects the buyer since no payment obligation arises until the goods have been shipped as promised.

Documentary Collections
A documentary collection (D/C) is a transaction whereby the exporter entrusts the collection of the payment for a sale to its bank (remitting bank), which sends the documents that its buyer needs to the importer’s bank (collecting bank), with instructions to release the documents to the buyer for payment. Funds are received from the importer and remitted to the exporter through the banks involved in the collection in exchange for those documents. D/Cs involve using a draft that requires the importer to pay the face amount either at sight (document against payment) or on a specified date (document against acceptance). The collection letter gives instructions that specify the documents required for the transfer of title to the goods. Although banks do act as facilitators for their clients, D/Cs offer no verification process and limited recourse in the event of non-payment. D/Cs are generally less expensive than LCs.

Open Account
An open account transaction is a sale where the goods are shipped and delivered before payment is due, which in international sales is typically in 30, 60 or 90 days. Obviously, this is one of the most advantageous options to the importer in terms of cash flow and cost, but it is consequently one of the highest risk options for an exporter. Because of intense competition in export markets, foreign buyers often press exporters for open account terms since the extension of credit by the seller to the buyer is more common abroad. Therefore, exporters who are reluctant to extend credit may lose a sale to their competitors. Exporters can offer competitive open account terms while substantially mitigating the risk of non-payment by using one or more of the appropriate trade finance techniques covered later in this Guide. When offering open account terms, the exporter can seek extra protection using export credit insurance.

Consignment
Consignment in international trade is a variation of open account in which payment is sent to the exporter only after the goods have been sold by the foreign distributor to the end customer. An international consignment transaction is based on a contractual arrangement in which the foreign distributor receives, manages, and sells the goods for the exporter who retains title to the goods until they are sold. Clearly, exporting on consignment is very risky as the exporter is not guaranteed any payment and its goods are in a foreign country in the hands of an independent distributor or agent. Consignment helps exporters become more competitive on the basis of better availability and faster delivery of goods. Selling on consignment can also help exporters reduce the direct costs of storing and managing inventory. The key to success in exporting on consignment is to partner with a reputable and trustworthy foreign distributor or a third-party logistics provider. Appropriate insurance should be in place to cover consigned goods in transit or in possession of a foreign distributor as well as to mitigate the risk of non-payment

OCCUPATIONAL ENGLISH FOR ACCOUNTING - ARITHMETICAL SYMBOLS

 

ARITHMETICAL SYMBOLS

 

 

Objective : At the end of the lesson,stundents sould be able to use arithmetical symbols and explain arithmetical problems.

1.1   SYMBOLS

The  following symbols  are symbols or mathematical symbols.

Symbols	Read
+	Plus and
-	Minus
X	Times multiplied by
:	Divided by
=	Equals ; is equal to ; is

(+) is used for addition

(-)  is used for subtraction

(x) is used for multiplicand

(:)  is used division

1.1   NUMBERS

There are two kinds of numbers : cardinal and ordinal. Cardinal numbers are used in counting and to indicate quantities. Ordinal numbers are used  to indicate position in a series. This part shows the spelling of the cardinal numbers.

           1: one                                                   11: eleven

           2: two                                                   12: twelve

           3: three                                                 13: thirteen

           4: four                                                  14: fourteen

           5: five                                                   15: fifteen

           6: six                                                    16: sixteen

           7: seven                                                17: seventeen

           8: eight                                                 18: eighteen

           9: nine                                                  19: Nineteen

           10: ten                                                  20: Twenty

      21 twenty-one                                      101 a (one) hundred (and) one

      30 thirty                                                200 two hundred

      40 forty                                                225 two hundred (and) twenty-five

      50 fifty                                                 1.000 a (one) thousand

60 sixty                                                2.000 two thousand

70 seventy                                           3489 three thousand four hundred and eighty-nine

80 eighty                                              1.000.000 a (one) million

90 ninety                                              2.000.000 two million*

            100 (one) hundred                               1.000.000.000 a (one)  billion

  

      *note that there is no s on thousand or million

1.3 APPLICATION

           Arithmetical/mathematical symbols are read like this:

a.                                Addition

      

         3+9=12                                 Three plus nine aquals twelve

         3+8                                        Three plus eight

         4+4=?                                    How much are three and four

         4+4=8                                    Four and four are eight

b.                               Subtraction

         17-6                                      Seventeen minus six

                                               4529-200=?            How much are four thousand two hundred and fifty-nine minus to hundred?                    

                                                 14310

            -5210 

                Nought from nought leaves nought. One from leaves nought ( or nothing). Two from three leaves one. I can’t take (or subtract) five  from four, I must borrow ten; five from fourteen leaves nine. The difference (or the reminder) is nine thousand none hundred.

c.                              Multiplication

              8x4                                         Eight times four

              1x1=1                                    Once one is one

              2x1=2                                    Twice two is two

              3x5=15                                  Three times five is fifteen

              19x9=?                                  How much are nineteen times nine?

              679

           x    85

             3395

             5432

           57715

                Five times nine(or nine multiplied by five) are forty-five; I put down five and carry four. Five times seven are thirty-five and four (that I carry) are thirty nine; I write down nine and carry three. Five times isx make thirty and three; I put down thirty-three. Eight times nin (or eight nine) are seventy-two, I write two and carry seven. Eight sevens make fifty-six and seven are sixty-three. I put down three and carry six. Eight sixes make forty-eight and six are fifty-four; I write down fifty-four.

I now add he partial resul (or products) five. Two and nine are eleven. Three and three are six and one are seven. Four and three make seven five.

d.                        Division

         6:3                       six divided by three

        100:5=?                How much sre one hundred divided by five?

        750:50=15            seven hundred and fifty divided by fifty equals fifteen

      Conclusion:

•   For calculating, we can use the following arithmetical symbols:

            (+) is used for addition

            (-)  is used for subtraction

            (x) is used for multiplication

            (:)  is used for divison

•   inounting and calculating we use cardinal numbers, mot ordinal numbers

1          1.4   SUMMARY

As we know, in doing accounting calculation we use arithmetical symbols such as +, -, x. :, and 

We also use cardinal numbers to write the amount of the sum. That’s why it is suggested in this lesson the arithmetical symbols and cardinal numbers numbers, so that the students can learn how to explain the arithmetical problems in accounting.

OCCUPATIONAL ENGLISH FOR ACCOUNTING - DEADLING FOR ENGLISH PUBLIC SPEAKING

 

Dealing with the Fear of Public Speaking

 

 

 Most of us have heard about a study that claims public speaking is our number one fear. Jerry Seinfeld even made a joke out of it, noting that if fear of public speaking was number one, and death was lower down the list, it meant that people would rather die than give the eulogy at the funeral.
Now comes a study – surveying Americans – to check up on those fears. Is public speaking still number one?
The answers may surprise you a little. We public speakers can no longer proudly (or cravenly) point to public speaking as fear #1. Alas, it has dropped to number five.
Here’s the list:
1. Walking alone at night.
2. Becoming the victim of identity theft.
3. Safety on the internet.
4. Being the victim of a mass/random shooting.
5. Public speaking.
I find the list fascinating because two of the four greater fears – the ones that have displaced public speaking – are online-created fears. And I suspect that Fear #4 is largely a media-generated fear, since – and I know you’re going to find this hard to believe – the odds of you dying from a random shooting have actually gone down in the last 20 years, not up.
So that leaves walking alone at night and public speaking as fears that everyone will most likely have to confront at one time or another. You will eventually have to give a speech and you will probably have to walk alone from somewhere to somewhere else during your lifetime.
I can’t help much with the walking alone – except to urge you to travel in groups – but I can offer a few tips for dealing with the fear of public speaking.
Begin by re-defining the fear you’re feeling for what it is: adrenaline. You’re feeling trapped and your body is doing an ancient thing – letting you know that it’s time for fight or flight.
Then let the adrenaline be helpful to you. Adrenaline can throw you off or it can carry you through your talk.
How do you work that magic? Avoid the downside. Focus on the positive. Just as little unexpected problems encountered at the beginning of a presentation can throw you off your stride, three simple steps you can take before you start can help ensure that your speech gets off to a great start.
First, find someone to talk to – who will be in the audience. You can usually arrange to meet members of the audience before a speech, whether it’s at a cocktail party the night before or even in the few minutes before a presentation is due to start. As you’re making conversation, ask them what’s on their minds, and what their needs are.
Set up a question for the Q&A, if you’re allowing for that. Then, when you get up to speak, imagine you’re talking to that one individual. For many speakers, the result is to warm up the delivery and calm down the nerves. It’s easier to talk to one real person than a mass of unknowns. If the conversation was in depth and took place the night before, you might even be able to weave some of the audience’s comments and concerns into your talk.
Second, shake the hand of the person who introduces you. This simple little gesture will help ground you. It will help prevent some of the nervousness that we all feel at the beginning of a speech. It also presents a strong visual image of connection and trustworthiness to the audience, since the introducer is usually someone the audience knows. And it’s the polite thing to do, if you’ve been given a great introduction.
Third, take a deep breath before you speak, then swallow, then begin. The breath helps you build some resonance in your voice, keeping it from being squeaky or shaky.
To do it right, though, you must breathe from your diaphragm, what speech coaches often call “belly breathing.” Your stomach should inflate, and your shoulders should remain level. If you raise your shoulders when you breathe, you actually squeeze your lungs into a smaller space, constricting your voice. The swallow helps steady your voice. And the pause works well with the audience, to build a connection between you and it, and adds a little drama.
The first thirty seconds of any speech are key. You’ll either make a good impression on the audience, helping them relax and believe that they’re in store for an interesting time, or you will do the opposite. So play it smart. If you stride in with lots of energy, smile confidently, and take charge of the space and the audience immediately, you’ll be off to an excellent start. If you slump in, fidget your energy away, and talk only to the few people right in front of you, you’ll make the opposite impression. Of course, it’s easier to stride in confidently if the inner you is thriving and confident, so don’t neglect the important work on that.
In the end, the best way to start a speech – and to help you relax – is to get the audience involved from the very top. Get them to do something interesting. Then tell them your opening story and get to work. But if you get them going at the start, the energy you will unleash will amaze you.
The cliché in this situation is to ask for a show of hands, “Anyone from Poughkeepsie?” or some other such meaningless exchange. The better way is to engage them in something that relates to the topic. Get them to help you articulate the problem you’re going to discuss, or identify some of the issues that lie behind the problem.
Another way to involve the audience from the start is to report to them about them. Audiences are always interested in hearing about themselves. It flatters their vanity. So do your homework, and tell them something interesting (and complimentary) about them. What percentage of them are CEOs? Or involved in not-for-profit work? Or have attained advanced degrees? Make it relevant to your subject.

OCCUPATIONAL ENGLISH FOR ACCOUNTING - ACCOUNTING TERMS

 

Accounting Terms

 

Entering into the accounting field can be a little confusing at first with all of the new terminology to learn. Don't feel left out in conversations and don't be left behind because you aren't sure what someone is talking about. Check out the accounting terms below and find out what that last conversation was about. Learn these terms before starting your first big job and you will WOW your employer. Learn these terms before your accounting classes start and you will definitely be a step ahead of everyone else in your classes.

Accounting Equation - The Accounting Equation is Assets = Liabilities + Equity. With accurate financial records, the equation balances.

Accounting - Accounting keeps track of the financial records of a business. In addition to recording financial transactions, it involves reporting, analyzing and summarizing information.

Accounts Payable - Accounts Payable are liabilities of a business and represent money owed to others.

Accounts Receivable - Assets of a business and represent money owed to a business by others.

Accrual Accounting - Records financial transactions when they occur rather than when cash changes hands. For example, when goods are received without payment, an Accounts Payable is recorded.

Accruals - Accruals acknowledge revenue when it is earned and expenses when they are incurred even though a cash transaction may not be involved.

Amortization - Reduces debts through equal payments that include interest.

Asset - Items of value that are owned.

Audit Trail - Allow financial transactions to be traced to their source.

Auditors - Examine financial accounts and records to evaluate their accuracy and the financial condition of the entity.

Balance Sheet - Provides a snapshot of a business' assets, liabilities, and equity on a given date.

Bookkeeping - Recording of financial transactions in an accounting system.

Budgeting - Budgeting involves maintaining a financial plan to control cash flow.

Capital Stock - Total amount of common and preferred stock issued by a company.

Capital Surplus - The amount in excess of par value for shares of common stock.

Capitalized Expense - Accumulated expenses that are expensed over time.

Cash Flow - The difference in money flowing in and out. A negative flow indicates more money going out than coming in. A positive flow shows more money coming in than going out.

Cash-Basis Accounting - Records when cash is received through revenues and disbursed for expenses.

Chart of Accounts - An organization's list of accounts used to record financial transactions.

Closing the Books/Year End Closing - Closing the Books occurs at the end of the annual period and allows for a start with a clean book at the beginning of the next year.

Cost Accounting - Used internally to determine the cost of operations and to establish a budget to increase profitability.

Credit - Entered in the right column of accounts. Liability, equity and revenue increase on the credit side.

Debit - Entered in the left column of accounts. Assets and expenses increase on the debit side.

Departmental Accounting - Shows individual departments' income, expenses and net profit.

Depreciation - The decrease in an asset's value over time.

Dividends - Profits returned to the shareholders of a corporation.

Double-Entry Bookkeeping - Requires entries of debits and credits for each financial transaction.

Equity - Represents the value of company ownership.

Financial Accounting - The accounting branch that prepares financial reporting primarily for external users.

Financial Statement - Financial Statements detail the financial activities of a business.

Fixed Asset - Used for a long period of time, e.g. - equipment or buildings.

General Ledger - Where debit and credit transactions are recorded.

Goodwill - Intangible asset a business enjoys like its reputation or brand popularity.

Income Statement - A Financial Statement documents the difference in revenue and expenses resulting in income.

Inventory Valuation - A valuation method modified for use in real estate and business appraisals.

Inventory - Inventory consists of raw materials, work in progress, and finished goods.

Invoice - An Invoice shows the amount of money owed for goods or services received.

In The Black - Makes reference to a profit on the books; opposite of “in the red.” Black Friday sales are known for the profit retailers are adding to their books.

In The Red - Makes reference to a loss on the books; opposite of “in the black.” In the days of handwritten accounting, ledger entries written in black meant there was a profit, but those in red meant there was a loss.

Job Costing - Job Costing tracks costs of a particular job against its revenues.

Journal - The first place financial transactions are entered. They are entered chronologically.

Liability - Liabilities are the obligations of an entity, usually financial in nature.

Liquid Asset - Consist of cash and other assets that can be easily converted to cash.

Loan - A monetary advance from a lender to a borrower.

Master Account - A Master Account has subsidiary accounts. Accounts Receivable could be a master account for various individual receivable accounts.

Net Income - Net Income equals revenue minus expenses, taxes, depreciation and interest.

Non-Cash Expense - Does not require cash outlay, e.g. - depreciation.

Non-operating Income - Income not generated from the business. An example might be the sale of unused equipment.

Note - A Note is a document promising to repay a debt.

Operating Income - Determined by subtracting operating expenses from operating revenue. Interest and income tax expenses are not included.

Other Income - Non-recurring income, e.g. - interest.

Payroll - An account listing employees and any wages and salaries due them.

Posting - Refers to the recording of ledger entries.

Profit - Profit is revenue minus expenses. Reductions for taxes, interest, and depreciation are included.

Profit/Loss Statement - A financial report issued by a company on a regular basis that discloses earnings, expenses and net profit for a given time period.

Reconciliation - The act of proving an account balances; debits and credits equal. An example of reconciling an account is to verify that the bank statement matches the checkbook balance, making allowances for outstanding checks and deposits.

Retained Earnings - Money left after all the bills have been paid and all the shareholder dividends have been distributed; often reinvested in the business.

Revenue - The actual amount of money a company brings in during a particular time period; gross income.

Shareholder Equity - A company’s total assets less its total liabilities; owner’s equity; net worth. Shareholder equity comes from the start-up capital of the business plus retained earnings amassed over time.

Single-Entry Bookkeeping - An accounting process that uses on one entry, instead of debit and credit entries. Small businesses using cash accounting system benefit from the ease of this system, which is much like keeping a checkbook.

Statement of Account - A written document that shows all charges and payments; accounts receivable statement; accounts payable statement. Generally, a monthly accounts receivable statement is sent to a charge customer; and reconciled by an accounts payable clerk for payment.

Subsidiary Accounts - Accounts that are under a control account; they must equal the main account balance. Examples of subsidiary accounts may be “Office Supplies,” or “Cleaning Supplies,” under the control account called “Supplies.”

Supplies - Consumable materials used in business and replenished as needed. Supplies are not inventory for sale; rather they are used to carry out business activities.

Treasury Stock - Shares a company retains or buys back once offered to the public for purchase.

Write-down/Write-off - An accounting transaction that reduces the value of an asset.