FIXED CHARGE Definition

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FIXED CHARGE is those expenses incurred each time a batch of product is produced. Primarily consists of ordering cost for the raw material, engineering costs for machine setup and preparation for the production run, and work order processing cost; also known as SETUP COST.

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REVERSE REPURCHASE AGREEMENT (reverse repo) is the opposite of a repo in that it is the purchase of securities (usually government debt) tied to an agreement to sell the security back at a later date at a higher price. Reverse repos are normally short term agreements; primarily on an overnight basis.

LITIGATION RISK is an assessment of the likelihood or probability that legal action may be taken, e.g. auditors may encounter an unacceptable level of litigation risk on an assignment where the client has possibly been involved with fraudulent financial reporting.

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