# FP&A glossary

> Short definitions with formula, worked example and how Fibady does it.

- [Account mapping](https://www.fibady.com/en/glossary/account-mapping): Account mapping is the link between each account in an entity's local chart and the group account where it is reported, so you consolidate without rework.
- [Analytical accounts](https://www.fibady.com/en/glossary/analytical-accounts): Analytical accounts are tags that classify each journal entry by management dimensions (project, product, country, channel) beyond the accounting account.
- [ARPA](https://www.fibady.com/en/glossary/arpa): ARPA (Average Revenue Per Account) is the average revenue per account or customer in a period: recurring revenue divided by the number of active accounts.
- [Board deck](https://www.fibady.com/en/glossary/board-deck): The board deck is the periodic presentation to the board or investors with results, cash position, forecast and the decisions to be taken.
- [Break-even](https://www.fibady.com/en/glossary/break-even): Break-even is the revenue level at which a company covers all its costs and the result is zero. Below it, it loses money; above it, every sale adds profit.
- [Budget vs. actual](https://www.fibady.com/en/glossary/budget-vs-actual): Budget vs. actual is the line-by-line comparison between what was planned and what was booked in a period, measuring variances in amount and percentage.
- [Burn rate](https://www.fibady.com/en/glossary/burn-rate): Burn rate is the cash a company consumes each month: total payments (gross) or payments minus receipts (net). With available cash, it determines runway.
- [Closing entry](https://www.fibady.com/en/glossary/closing-entry): The closing entry zeroes out revenue and expense accounts at year end and transfers the result to equity, so the next year starts from zero.
- [Consolidation exchange rate](https://www.fibady.com/en/glossary/consolidation-exchange-rate): The consolidation exchange rate translates each entity's statements into group currency: period average for the P&L, closing rate for the balance sheet.
- [Consolidation scope](https://www.fibady.com/en/glossary/consolidation-scope): The consolidation scope is the set of entities that enter a group's consolidated statements and the method by which each one is integrated.
- [Contribution margin](https://www.fibady.com/en/glossary/contribution-margin): Contribution margin is what remains of revenue after variable costs: the part of each sale that contributes to covering fixed costs and generating profit.
- [Cost center](https://www.fibady.com/en/glossary/cost-center): A cost center is a unit of the company (department, store, team) to which expenses are assigned to know what it costs and compare it with its budget.
- [Direct vs indirect cash flow](https://www.fibady.com/en/glossary/direct-vs-indirect-cash-flow): Direct cash flow shows actual receipts and payments from the banks; indirect starts from accounting profit and adjusts it. Both reach the same cash change.
- [Drill-down](https://www.fibady.com/en/glossary/drill-down): Drill-down is the ability to open any figure in a report to see what makes it up, level by level, down to the accounting entry that originated it.
- [DSO / DPO](https://www.fibady.com/en/glossary/dso-dpo): DSO and DPO are the average days a company takes to collect from customers and to pay suppliers. Together they explain much of the pressure on cash.
- [Dual currency](https://www.fibady.com/en/glossary/dual-currency): Dual currency is viewing the same financial statements in each entity's local currency and in the group's currency, without recalculating or duplicating.
- [EBITDA](https://www.fibady.com/en/glossary/ebitda): EBITDA is profit before interest, taxes, depreciation and amortisation: it measures what the business generates without financing or accounting effects.
- [Financial consolidation](https://www.fibady.com/en/glossary/financial-consolidation): Financial consolidation combines the statements of several group entities into one P&L, balance sheet and cash flow, eliminating transactions between them.
- [Financial KPI](https://www.fibady.com/en/glossary/financial-kpi): A financial KPI is a numeric indicator of a company's economic health (margin, EBITDA, runway, DSO) that is tracked every period against a target.
- [FP&A](https://www.fibady.com/en/glossary/fp-a): FP&A (Financial Planning & Analysis) is the finance function that turns accounting into decisions: management reporting, budgeting, forecasting, variances.
- [General journal](https://www.fibady.com/en/glossary/general-journal): The general journal is the chronological record of an entity's accounting entries: date, accounts, debit, credit and description. Every report starts here.
- [Group chart of accounts](https://www.fibady.com/en/glossary/group-chart-of-accounts): The group chart of accounts is the common catalogue to which each entity's local chart is mapped, so the group can consolidate and compare in one format.
- [Intercompany eliminations](https://www.fibady.com/en/glossary/intercompany-eliminations): Intercompany eliminations remove sales, purchases, loans and balances between group entities from the consolidation, leaving only third-party transactions.
- [Leverage](https://www.fibady.com/en/glossary/leverage): Leverage is the use of debt to finance a company's activity or investments. It is measured by comparing debt with EBITDA or with equity.
- [Rolling forecast](https://www.fibady.com/en/glossary/rolling-forecast): A rolling forecast is a projection updated every month or quarter by adding a new period at the end, so it always covers the same horizon ahead.
- [Runway](https://www.fibady.com/en/glossary/runway): Runway is the number of months a company can keep operating with its current cash at its current burn rate before running out of liquidity.
- [Subgroup](https://www.fibady.com/en/glossary/subgroup): A subgroup is a set of entities within a larger group that is consolidated separately, usually by region, business line or intermediate holding company.
- [Working capital](https://www.fibady.com/en/glossary/working-capital): Working capital is current assets minus current liabilities: the cash a business needs to operate. Its change explains the gap between profit and cash.