Filipino Business Definition of Terms
This glossary provides clear, simple definitions of essential Filipino business, finance, tax, HR, MSME, and entrepreneurship terms. Each term links to a dedicated page with examples, FAQs, and schema‑optimized definitions to help entrepreneurs, freelancers, and MSMEs understand key concepts quickly.
| A | ||
| Accounts Payable (AP) | Money your business owes to suppliers. | View full definition → |
| Accounts Receivable (AR) | Money customers owe your business. | View full definition → |
| Accrual | Recording income and expenses when earned. | View full definition → |
| Acquisition Cost | Total cost of acquiring an asset. | View full definition → |
| Amortization | Spreading loan payments over time. | View full definition → |
| Asset | Anything your business owns with value. | View full definition → |
| Audit Trail | Record of financial transactions and changes. | View full definition → |
| Authorized Capital Stock | Maximum shares a corporation may issue. | View full definition → |
| Automation | Using tools to reduce manual work. | View full definition → |
| Average Daily Sales | Average revenue earned per day. | View full definition → |
| B | ||
| Balance Sheet | Snapshot of assets, liabilities, equity. | View full definition → |
| Barangay Clearance | Local business clearance. | View full definition → |
| BIR | Tax authority of the Philippines. | View full definition → |
| BMBE | Tax incentives for micro businesses. | View full definition → |
| Bookkeeping | Recording daily transactions. | View full definition → |
| Break-Even Point | Sales needed to cover costs. | View full definition → |
| Brand Awareness | How people are familiar with your brand. | View full definition → |
| Brand Equity | Value of your brand. | View full definition → |
| Budgeting | Planning business expenses. | View full definition → |
| Business Model | How a business earns money. | View full definition → |
| Business Permit | Mayor’s permit to operate. | View full definition → |
| C | ||
| Capital | Money used to start a business. | View full definition → |
| Cash Flow | Money moving in and out. | View full definition → |
| Cash Flow Forecast | Predicting future cash movement. | View full definition → |
| Carinderia | Small Filipino eatery. | View full definition → |
| Certificate of Registration (COR) | BIR registration certificate. | View full definition → |
| Collateral | Asset pledged for a loan. | View full definition → |
| Commission | Sales-based compensation. | View full definition → |
| Compliance | Following government rules. | View full definition → |
| Consignment | Sell goods you don’t own. | View full definition → |
| Credit Line | Pre-approved borrowing limit. | View full definition → |
| D | ||
| Daily Sales Report | Summary of daily sales activity. | View full definition → |
| Data Privacy | Protection of customer information. | View full definition → |
| Depreciation | Loss of value of an asset over time. | View full definition → |
| Digital Wallet | Electronic payment tool. | View full definition → |
| Dividend | Share of profits paid to owners. | View full definition → |
| DOLE Compliance | Following labor regulations. | View full definition → |
| DTI Registration | Business name registration. | View full definition → |
| Due Diligence | Careful review before decisions. | View full definition → |
| Duty-Free | Goods exempt from taxes. | View full definition → |
| Dynamic Pricing | Adjusting prices based on demand. | View full definition → |
| E | ||
| Earnings | Profit after expenses. | View full definition → |
| E-Commerce | Buying and selling online. | View full definition → |
| Employee Benefits | Non-wage compensation. | View full definition → |
| Entrepreneur | Person who starts a business. | View full definition → |
| Equity | Owner’s share in a business. | View full definition → |
| Escrow | Funds held by a third party. | View full definition → |
| Expenses | Costs of running a business. | View full definition → |
| Export Permit | Authorization to export goods. | View full definition → |
| External Audit | Independent financial review. | View full definition → |
| E-Wallet Payments | Payments via digital wallets. | View full definition → |
| F | ||
| Financial Statement | Formal record of finances. | View full definition → |
| Financing | Borrowing money for business. | View full definition → |
| Fixed Costs | Costs that don’t change monthly. | View full definition → |
| Forecasting | Predicting future performance. | View full definition → |
| Franchise | Business model using a brand. | View full definition → |
| Freelancing | Independent contract work. | View full definition → |
| Full-Time Employee | Employee working full hours. | View full definition → |
| Fund Flow | Movement of funds in business. | View full definition → |
| Fund Transfer | Moving money between accounts. | View full definition → |
| Food Costing | Calculating cost of ingredients. | View full definition → |
| G | ||
| GCash | Popular Philippine mobile wallet. | View full definition → |
| General Ledger | Main record of all financial transactions. | View full definition → |
| Gig Economy | Short-term, freelance-based work system. | View full definition → |
| Government Loan | Financing provided by government agencies. | View full definition → |
| Gross Income | Total income before deductions. | View full definition → |
| Gross Margin | Revenue minus cost of goods sold. | View full definition → |
| Gross Sales | Total sales before deductions. | View full definition → |
| Guarantor | Person who guarantees a loan. | View full definition → |
| Guerrilla Marketing | Low-cost, creative marketing tactics. | View full definition → |
| GWP (Gift With Purchase) | Free item given with a purchase. | View full definition → |
| H | ||
| Hiring | Process of recruiting employees. | View full definition → |
| HR Compliance | Following labor and employment laws. | View full definition → |
| Health Insurance | Coverage for medical expenses. | View full definition → |
| Home-Based Business | Business operated from home. | View full definition → |
| Human Resources (HR) | Department managing employees. | View full definition → |
| Hybrid Work | Mix of remote and on-site work. | View full definition → |
| Holding Company | Company owning shares of others. | View full definition → |
| Holiday Pay | Premium pay for holidays. | View full definition → |
| HMO | Health Maintenance Organization. | View full definition → |
| Hustle Culture | Mindset of constant productivity. | View full definition → |
| I | ||
| Import Permit | Authorization to bring goods into the country. | View full definition → |
| Income Statement | Report showing profit or loss. | View full definition → |
| Incorporation | Forming a corporation legally. | View full definition → |
| Independent Contractor | Self-employed service provider. | View full definition → |
| Inflation | Increase in prices over time. | View full definition → |
| Input Tax | VAT paid on purchases. | View full definition → |
| Inspection Certificate | Document verifying compliance. | View full definition → |
| Intellectual Property (IP) | Rights to creations or inventions. | View full definition → |
| Inventory | Goods available for sale. | View full definition → |
| Invoice | Billing document for goods/services. | View full definition → |
| J | ||
| Job Order | Short-term work arrangement. | View full definition → |
| Joint Venture | Two parties forming a shared business. | View full definition → |
| Journal Entry | Record of a financial transaction. | View full definition → |
| Just-in-Time Inventory | Stock arrives only when needed. | View full definition → |
| Job Description | Details of a role’s duties. | View full definition → |
| Job Posting | Public announcement of a job opening. | View full definition → |
| Job Seeker | Person looking for employment. | View full definition → |
| Job Specification | Required skills for a role. | View full definition → |
| Job Rotation | Moving employees between roles. | View full definition → |
| Job Evaluation | Assessing job value for pay. | View full definition → |
| K | ||
| KPI (Key Performance Indicator) | Metric to measure performance. | View full definition → |
| Kaizen | Continuous improvement approach. | View full definition → |
| Knowledge Base | Centralized information resource. | View full definition → |
| Key Account | High-value client or customer. | View full definition → |
| Kickback | Illegal payment for favors. | View full definition → |
| Know-Your-Customer (KYC) | Identity verification process. | View full definition → |
| Knowledge Transfer | Sharing expertise within a team. | View full definition → |
| Keyman Insurance | Insurance for essential personnel. | View full definition → |
| Kitchen Display System (KDS) | Digital order display for kitchens. | View full definition → |
| Kitting | Bundling items into a single package. | View full definition → |
| L | ||
| Liabilities | Debts your business owes. | View full definition → |
| Ledger | Record of all accounts. | View full definition → |
| Loan | Borrowed money to be repaid. | View full definition → |
| Logistics | Managing movement of goods. | View full definition → |
| Loss | When expenses exceed revenue. | View full definition → |
| Labor Code | Philippine employment law. | View full definition → |
| Lead Time | Time between order and delivery. | View full definition → |
| Lease Agreement | Contract for renting property. | View full definition → |
| Legal Compliance | Following laws and regulations. | View full definition → |
| Liquidity | Ability to meet short-term obligations. | View full definition → |
| M | ||
| Marketing Mix | Combination of strategies to promote a product. | View full definition → |
| Market Research | Studying customers and competitors. | View full definition → |
| Markup | Added amount to the cost to set a price. | View full definition → |
| Minimum Wage | Lowest legal pay for workers. | View full definition → |
| MSME | Micro, small, and medium enterprises. | View full definition → |
| Monthly Sales Report | Summary of monthly sales performance. | View full definition → |
| Merchant Account | Account that allows card payments. | View full definition → |
| Microloan | Small loan for micro businesses. | View full definition → |
| Margin | Difference between cost and selling price. | View full definition → |
| Market Share | Percentage of sales in an industry. | View full definition → |
| N | ||
| Net Income | Profit after all expenses. | View full definition → |
| Networking | Building professional relationships. | View full definition → |
| Notice of Assessment (NOA) | BIR notice about tax findings. | View full definition → |
| Net Worth | Total assets minus liabilities. | View full definition → |
| Non-Disclosure Agreement (NDA) | Contract to protect confidential info. | View full definition → |
| Non-Compete Agreement | Limits working with competitors. | View full definition → |
| Net Sales | Sales after returns and discounts. | View full definition → |
| Negotiation | Process of reaching an agreement. | View full definition → |
| Notice of Violation | Government warning for non-compliance. | View full definition → |
| Net Profit Margin | Percentage of profit from sales. | View full definition → |
| O | ||
| Operating Expenses (OPEX) | Costs to run daily operations. | View full definition → |
| Online Store | Digital shop selling products/services. | View full definition → |
| Overhead Costs | Expenses not tied to production. | View full definition → |
| Output Tax | VAT collected from customers. | View full definition → |
| Outsourcing | Hiring external providers for tasks. | View full definition → |
| Online Banking | Managing finances digitally. | View full definition → |
| Order Fulfillment | Process of delivering customer orders. | View full definition → |
| Organizational Chart | Visual structure of a company. | View full definition → |
| Overtime Pay | Extra pay for work beyond regular hours. | View full definition → |
| Online Marketing | Promoting products on the internet. | View full definition → |
| P | ||
| Payroll | Process of paying employees. | View full definition → |
| Permit to Operate | Local government approval to run a business. | View full definition → |
| Pricing Strategy | Method used to set product prices. | View full definition → |
| Profit | Money left after expenses. | View full definition → |
| Profit Margin | Percentage of profit from sales. | View full definition → |
| Purchase Order (PO) | Document requesting goods from a supplier. | View full definition → |
| Petty Cash | Small fund for minor expenses. | View full definition → |
| Partnership | Business owned by two or more people. | View full definition → |
| Productivity | Efficiency in producing goods or services. | View full definition → |
| Purchase Requisition | Internal request to buy goods. | View full definition → |
| Q | ||
| Quality Control (QC) | Ensuring products meet standards. | View full definition → |
| Quarterly Report | Business performance every three months. | View full definition → |
| Quotation | Estimated price for goods or services. | View full definition → |
| Queue Management | System for handling customer lines. | View full definition → |
| Quick Ratio | Measure of liquidity without inventory. | View full definition → |
| Quality Assurance (QA) | Process to maintain service quality. | View full definition → |
| Quota | Sales or production target. | View full definition → |
| QuickBooks | Popular accounting software. | View full definition → |
| Quality Standards | Benchmarks for product/service quality. | View full definition → |
| Quantitative Research | Research using numerical data. | View full definition → |
| R | ||
| Revenue | Total income from sales. | View full definition → |
| ROI (Return on Investment) | Profit earned from an investment. | View full definition → |
| Retention | Keeping customers or employees. | View full definition → |
| Receipts | Proof of payment for goods/services. | View full definition → |
| Reconciliation | Matching records with bank statements. | View full definition → |
| Risk Management | Identifying and reducing risks. | View full definition → |
| Retention Bonus | Incentive to keep employees. | View full definition → |
| Reorder Point | Inventory level that triggers restocking. | View full definition → |
| Refund | Money returned to a customer. | View full definition → |
| Remittance | Money sent by OFWs to the Philippines. | View full definition → |
| S | ||
| Sales Invoice | Official document for a sale. | View full definition → |
| SSS (Social Security System) | Government insurance for workers. | View full definition → |
| Salary Loan | Short-term loan for employees. | View full definition → |
| Supply Chain | System of producing and delivering goods. | View full definition → |
| Sales Forecast | Prediction of future sales. | View full definition → |
| Service Charge | Additional fee for services. | View full definition → |
| Stock Keeping Unit (SKU) | Unique code for inventory items. | View full definition → |
| Sales Return | Returned goods from customers. | View full definition → |
| Statement of Account (SOA) | Summary of unpaid balances. | View full definition → |
| Segregation of Duties | Dividing tasks to prevent fraud. | View full definition → |
| T | ||
| Tax Mapping | BIR inspection of business compliance. | View full definition → |
| Trademark | Legal protection for brand names/logos. | View full definition → |
| Turnover | Total sales or employee replacement rate. | View full definition → |
| Tax Deduction | Expense subtracted from taxable income. | View full definition → |
| Tax Credit | Amount deducted from tax owed. | View full definition → |
| Trade License | Permit to operate a business legally. | View full definition → |
| Target Market | Specific group of customers. | View full definition → |
| Trial Balance | List of all accounts and balances. | View full definition → |
| Taxpayer Identification Number (TIN) | Unique ID for tax purposes. | View full definition → |
| Trade Receivables | Money owed by customers. | View full definition → |
| U | ||
| Utilities | Basic services like water and electricity. | View full definition → |
| Unemployment | State of not having a job. | View full definition → |
| Upselling | Encouraging customers to buy more. | View full definition → |
| Underwriting | Evaluating risk for loans or insurance. | View full definition → |
| Unliability | Business protection from personal liability. | View full definition → |
| Unrealized Gain | Profit not yet converted to cash. | View full definition → |
| Unrealized Loss | Loss not yet finalized. | View full definition → |
| User Experience (UX) | How users feel when using a product. | View full definition → |
| Usage-Based Billing | Charging based on consumption. | View full definition → |
| Unsecured Loan | Loan without collateral. | View full definition → |
| V | ||
| VAT (Value-Added Tax) | Tax added to goods and services. | View full definition → |
| Variable Cost | Cost that changes with production. | View full definition → |
| Vendor | Supplier of goods or services. | View full definition → |
| Venture Capital | Investment in startups or small businesses. | View full definition → |
| Verification | Confirming accuracy of information. | View full definition → |
| Virtual Assistant (VA) | Remote worker providing support services. | View full definition → |
| Void Transaction | Canceled sale before completion. | View full definition → |
| Value Chain | Activities that add value to a product. | View full definition → |
| Value Proposition | Reason customers choose your product. | View full definition → |
| Vendor Management | Handling relationships with suppliers. | View full definition → |
| W | ||
| Withholding Tax | Tax deducted from income at source. | View full definition → |
| Working Capital | Funds available for daily operations. | View full definition → |
| Warranty | Guarantee on product quality. | View full definition → |
| Workload | Amount of work assigned. | View full definition → |
| Workforce | Employees in an organization. | View full definition → |
| Workflow | Sequence of business processes. | View full definition → |
| Wholesale | Selling goods in bulk. | View full definition → |
| Write-Off | Removing uncollectible debt. | View full definition → |
| Workplace Safety | Practices ensuring safe work conditions. | View full definition → |
| Work Order | Instruction to perform a task. | View full definition → |
| X | ||
| X-Efficiency | Efficiency gained by reducing waste. | View full definition → |
| XML (Extensible Markup Language) | Data format for storing and transporting information. | View full definition → |
| X-Deal | Exchange of goods/services without cash. | View full definition → |
| XBRL | Standard for digital business reporting. | View full definition → |
| Xenocurrency | Currency traded outside its home country. | View full definition → |
| X-Factor | Unique quality that adds value. | View full definition → |
| X-Rate | Exchange rate between currencies. | View full definition → |
| X-Industry | Cross-industry collaboration. | View full definition → |
| X-Marketing | Experimental or unconventional marketing. | View full definition → |
| X-Logistics | Specialized logistics operations. | View full definition → |
| Y | ||
| Yield | Return on an investment. | View full definition → |
| Year-End Report | Annual summary of business performance. | View full definition → |
| Year-to-Date (YTD) | Performance from start of year to today. | View full definition → |
| Yield Management | Adjusting prices to maximize revenue. | View full definition → |
| Yellow Pad | Informal term for handwritten notes. | View full definition → |
| Yardstick Competition | Comparing performance across firms. | View full definition → |
| Yarn Count | Thickness of yarn in textiles. | View full definition → |
| Yield Curve | Graph showing interest rates over time. | View full definition → |
| YTD Earnings | Total earnings for the year so far. | View full definition → |
| Yard Management | Managing movement of goods in a yard. | View full definition → |
| Z | ||
| Zero-Rated Sales | VAT-exempt sales at 0% rate. | View full definition → |
| Zoning Permit | Approval to use property for business. | View full definition → |
| Zero-Based Budgeting | Budgeting from scratch each period. | View full definition → |
| Zombie Company | Business surviving only through debt. | View full definition → |
| Zone Pricing | Pricing based on geographic areas. | View full definition → |
| Z-Score | Measure of financial health. | View full definition → |
| Zero Liability | Protection from unauthorized charges. | View full definition → |
| Zero Inventory | Keeping minimal stock on hand. | View full definition → |
| Zone of Possible Agreement (ZOPA) | Range where negotiation is possible. | View full definition → |
| Zero Coupon Bond | Bond sold at discount with no interest. | View full definition → |