In This Section
Credit Terms 
Terms within a Credit and Security Agreement that set the guidelines for the lending relationship
Credit Memo Test
Test of credit memos by a field examiner. This test analyzes lag time from return/request date of the credit memo, whether a credit memo is dilutive and why it is being issued.
Credit Insurance
An insurance policy held by a company which protects the company against bad debts from their customers. Credit Insurance is typically purchased to allow for foreign receivables and high risk account debtors to be included in the borrowing base.
Credit and Security Agreement
An Agreement in which all of the terms and provisions of a credit facility are defined and agreed upon between the parties.
Cram Down
A Cram Down is a process used in bankruptcy, when there are still objections from one or more creditors, whereby the court is able to modify certain conditions in an attempt to improve outcome for all parties as long as the changes are fair and equitable.
Covenants
A Covenant is a legal term for a promise to do something (i.e., an affirmative covenant), refrain from doing something (i.e., a negative covenant) or maintain something (i.e., a maintenance covenant).
Covenant-Lite Loan
A Covenant-Lite Loan is a type of loan that does not contain the usual protective covenants whereby the loan is granted with minimum restrictions for the benefit of the borrowing party (which makes the financing more bond-like). Such loans are generally available in red-hot markets only.
Covenant Compliance Certificate
A Covenant Compliance Certificate is a document provided to a lender by a borrower, pursuant to the underlying credit agreement, certifying that the borrower has complied with the financial and other covenants set forth in such agreement, as well as usually confirming that no events of default have occurred.
Cost Test
A Cost Test is a process used to determine if the costs associated with a business will outperform a benchmark or other estimated standard, which aids in the decision of whether to pursue a specific business activity.
Cost of Goods Sold (COGS)
Cost of Goods Sold (COGS) are the costs directly attributable to the production of the goods sold by a company, including the cost of the materials used in creating the good along with the direct labor costs used to produce the good.
Cost of Capital
The Cost of Capital is the opportunity cost of making a specific investment. It refers to the rate of return that could have been earned by making a different investment with equal risk.
Corporate Resolutions
Corporate Resolutions are (often written) declarations made by the board of directors or other managing body of a corporate entity, authorizing and effecting certain actions taken or to be taken by the entity.
Copyright
A Copyright is a form of intellectual property protection. Under U.S. law, copyright protection is available for original works of authorship that are fixed in a tangible form.
Conversion (Build-Out)
A Conversion (also known as Build-Out) is the process or work preformed (e.g., construction, re-zoning, etc.) to change one type of real estate use to another type of real estate use.
Contra Account
A Contra Account is an account on the same financial ledger as an equivalent account and is used to reduce the value of such equivalent account. The contra account's values offset those of the equivalent account, such that, if a debt is recorded in the equivalent account, for example, a credit is simultaneously recorded in the contra account.
Consignment Sale
A Consignment Sale is a form of trade of merchandise from seller to an ultimate buyer through a non-ownership platform (e.g., reseller, store, website, etc.), whereby the platform receives a fee or pre-arranged sale amount for facilitating the transaction or selling the merchandise.
Consigned Inventory
Consigned Inventory is an inventory strategy that puts the inventory in possession of the customer, but is still owned by the supplier.
Concentration
A Concentration is a type of deposit account used internally at an institution, where funds are aggregated from multiple areas or transactions into one centralized account.
Compensating Balance
A Compensating Balance is a minimum account balance that a borrower agrees must be maintained with a lender. This allows a bank the freedom to loan the Compensating Balance to other borrowers and profit from the difference between the interest rates.
Comparable Store Sales
Comparable Store Sales are the amount of sales generated in a specified accounting period compared to amount of sales generated in a similar accounting period in the past.