ACCOUNTING TERMS - ACCOUNTING DICTIONARY - ACCOUNTING GLOSSARY
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FORWARD INTEREST RATE AGREEMENT Definition
FORWARD INTEREST RATE AGREEMENT is where two entities agree to a fixed interest rate in the future. If the actual rate is different than the fixed rate, one party will pay the other party the present value of the difference between the interest cash flows. Essentially the two entities are gambling on which way the interest rate of an index will change. These contracts are not traded on an established exchange but rather are private contracts between parties.
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SCRAP is material that is discarded as worthless or sold to be reused as parts; junk; a small unusable amount of something that is left over after the rest has been used or consumed.
NON-TRADE DEBT is that debt where invoices are issued to individuals not suppliers (trade).