accretive: An acquisition that will increase the acquiring company's EPS. As a general rule, an accretive merger or acquisition occurs when the P/E ratio of the acquiring firm is greater than that of the target firm.
acquisition: When one company purchases a majority interest in another com- pany.
adverse opinion: An opinion made by an auditor indicating that a company's financial statements are misrepresented, misstated and do not accurately reflect its financial performance and health.
American Stock Exchange: The third-largest stock exchange in the United States. The AMEX is located in New York and handles approximately 10 percent of all securities traded in the States. The exchange is primarily for smaller companies and derivatives.
annual meeting: A meeting held once a year by public companies where shareholders are invited to attend and vote on matters. Company execu- tives typically give presentations about the performance of the company at the meeting and answer questions from shareholders in the audience.
arbitration: A smaller version of a trial held in an attempt to avoid a court trial. In some contract cases, arbitration may be binding for both parties.
articles of incorporation: A set of documents filed with state authorities for the purpose of documenting the creation of a corporation.
assessed value: The property value as determined by the county tax assessor for tax purposes.
assets: Anything owned that has economic value. Asset is also a balance sheet item showing what a company owns. Assets are bought to increase the value of a firm or benefit the firm's operations. They can be anything from real estate to products.
auditor: An outside firm that conducts an examination and opinion of the financial statements of a business.
auditor's report: Recorded in the annual report, it tests to see that corporation's financial statements comply with generally accepted accounting practices, or GAAP. This is sometimes referred to as the "clean opinion."