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Asset and liability management (often abbreviated ALM) is the term covering tools and techniques used by a bank or other corporate to minimise exposure to market risk and liquidity risk through holding the optimum combination of assets and liabilities. [1]
B. usiness firms use a financial analysis technique called asset vs. liability management (ALM) to mitigate risk due to a mismatch in their assets and liabilities.
The accounting equation relates assets, liabilities, and owner's equity: Assets = Liabilities + Owner's Equity. The accounting equation is the mathematical structure of the balance sheet. Probably the most accepted accounting definition of liability is the one used by the International Accounting Standards Board (IASB). The following is a ...
Long-term investments are to be held for many years and are not intended to be disposed of in the near future. This group usually consists of three types of investments : Investments in securities such as bonds, common stock, or long-term notes; Investments in fixed assets not used in operations (e.g., land held for sale)
When it comes to a company's taxes, there are two important categories to understand: assets and liabilities. Tax liability is anything that a person or company owes taxes on, such as income or ...
A fixed asset, often referred to as a tangible asset or property, plant, and equipment (PP&E), is a long-term asset that holds value over time and can be used to generate income. These assets are ...
Formally, the duration gap is the difference between the duration - i.e. the average maturity - of assets and liabilities held by a financial entity. [3] A related approach is to see the "duration gap" as the difference in the price sensitivity of interest-yielding assets and the price sensitivity of liabilities (of the organization) to a change in market interest rates (yields).
Theory of asset management primarily deals with the periodic matter of improving, maintaining or in other circumstances assuring the economic and capital value of an asset over time. [2] The term is commonly used in engineering, the business world, and public infrastructure sectors to ensure a coordinated approach to the optimization of costs ...