1. Financial obligations that arise as a result of making credit purchases. 2. An accounting function that is responsible for making payment to contractors according to the contract terms and conditions. 3. Liability accounts that indicate the charges owed on open accounts.
Payments that are due to an entity per the contract terms and conditions.
Acid Test Ratio
A financial ratio calculated by subtracting the value of inventory from the current asset amount and dividing by current liabilities. (Schiller, 2000)
A written or electronic communication sent by the supplier to the entity that indicates that the supplier has accepted the order (Purchase Order). It may be a form of acceptance and may create a bilateral contract.
ACORD (Association of Cooperative Operations Research and Development)
A global, nonprofit organization founded in 1970 that serves the insurance and related industries. ACORD facilitates fast, accurate data exchange and more efficient workflows through the development of electronic standards, standardized forms, and tools to support their use. (ACORD, 2015)
1. The process of obtaining supplies, services, or construction through purchase, lease, or grants. 2. As defined under FAR 2.101, acquisition means the acquiring by contract with appropriated funds of supplies or services (including construction) by and for the use of the Federal Government through purchase or lease, whether the supplies or services are already in existence or must be created, developed, demonstrated, and evaluated. (U.S., FAR, 2005)
Act of God
An unforeseen occurrence beyond human control, caused by nature, such as a tornado or hurricane. Not attributable to the negligence of the contractor. (Harney, 1992)
The specific right to perform acts and make decisions or prescribe rules governing the conduct of others as given to an agent by a principal. (Garner, 2004)
All direct and indirect costs incurred for services, supplies, or construction as distinguished from estimated or forecasted costs.
Real damages to compensate for loss or injuries that actually occurred, resulted from another’s wrongdoing, and can be precisely measured.