Page 688 - Bruce Ellig - The Complete Guide to Executive Compensation (2007)

Glossary 673

corpus Trust’s principle from which income is generated.
correlation The extent to which two or more variables have a predictable relationship.
cost of capital Interest on long-term debt plus an assigned value for company common stock. See
economic profit.
cost of goods sold What it costs to make or buy the product (e.g., cost of materials used and other
manufacturing expenses such as pay and overhead). Often called direct costs.
cost of living The cost of basic goods and services for an individual or family.
cost-of-living adjustment An across-the-board pay action in response to a change in the cost of
living as measured by an index such as the Consumer Price Index (CPI).
cost-of-living allowance A payment in addition to salary to reflect geographic differences in the cost
of living.
Council of Institutional Investors Organization of pension funds that addresses investment
matters.
country club memberships See club membership.
coupon Attachment to a bond stating the bond interest rate.
court duty The need to serve as a witness or on a jury.
coverage Benefit availability for eligible employees.
covered bear A person possessing the shares “sold short.”
covered call Buying a call at a lower price than the price of a sold call to minimize the loss if the stock
price rises above the sold call price.
covered employee A person with benefit coverage covered by Section 162(m) or subject to proxy pay
disclosure.
CPA See Certified Public Accountant.
CPI See Consumer Price Index.
creative accounting Using the gaps in GAAP (Generally Accepted Accounting Principles) to alter
the income statement, cash flow statement, and/or balance sheet to achieve the desired outcome of
overstating or understating the results.
credit A revenue item on the income statement or an asset on the balance sheet.
credit-default swaps Insurance to protect against borrower defaulting on bonds.
credited earnings Income that is included in compensation and employee benefit plans.
credited service The period of employment used in determining eligibility for compensation and
employee benefit plans.
creditor An individual or organization that is owed an amount of money.
credit rating A qualitative or quantitative statement of an individual’s or organization’s credit-
worthiness.
credit union A cooperative that lends money to its members.
critical incident An act by the ratee noted by the rater as representative of positive or negative
performance.
critical success factors The goals and objectives essential to a company’s well-being.
culture How individuals relate to and deal with each other.
cumulative rate of return Compounded rate of return on asset.
cumulative voting Shareholders able to vote number of shares owned times the number of board
candidates all for one candidate.