Earnings statement A financial statement, usually part of an annual report, showing money taken in, its sources, and how it has been spent. The bottom line is the net profit.

Efficiency The most effective use or allocation of resources to yield the maximum benefits. Efficiency in one sense — the effective use of resources — is often applied to individual firms in comparing how well they organize the productive process (labour, management, machinery, new technology) to achieve the lowest possible production cost for their products. In a broader sense, it refers to the way in which all of the various factors of production are used to achieve maximum output throughout the economy at the lowest cost, or to achieve a distribution of the output of society that results in the greatest degree of satisfaction.

Electronic mail (e-mail) A service allowing a computer user to send messages instantaneously to another user’s directory or “mailbox.”

Employment standards The provincial or federal labour laws which establish minimum wages, hours, overtime pay, parental leave, paid vacation, etc.

Entrepreneur An initiator or owner of a business enterprise who recognizes opportunities to introduce a new product or service, a new production process or an improved organization, and who raises the necessary money, assembles the factors of production, and organizes an operation to exploit the opportunity or manage the enterprise. Another definition is simply a small business owner-operator.

Equity The difference between the assets and liabilities of a company, often referred to as net worth.

Equity capital The capital in a firm that represents ownership. The owners of the equity share capital in the firm and are entitled to all the assets and income of the firm after all the claims of creditors have been paid.

Equity capital/financing All money invested in a business in exchange for ownership (shares). Venture capital is equity provided by outside investors (i.e., not the owner/manager). Equity does not have to be repaid on a specific date and there are no interest charges (although dividends are normally paid from time to time).

Escrow The deferment of an obligation to pay or right of ownership for a stated time or until stated conditions are met.

Excise tax A tax on specific goods or service, such as alcohol or tobacco.

Executor A person appointed in a will to see that its terms are carried out.

Ex-factory The price of goods at the exporter’s loading dock (i.e., the buyer owns the goods at that point and bears all the risks and costs for
subsequent delivery).

Export declaration Prepared by exporter or freight forwarder for shipments valued in excess of a specified amount.

Export licence May be required for some export shipments (e.g., strategic goods).

Export management company (EMC) An independent firm which acts as the exclusive sales department for noncompeting manufacturers. There is usually a formal agreement to manage the manufacturer’s exports. Some act as an agent for the manufacturer and, in such cases, are paid a commission on the export sales. Others operate on a buy-sell basis; i.e., EMCs buy from their manufacturers at a set price, and resell to foreign customers.

Ex-works price This price normally includes export credit insurance, financing charges, and the profit margin. It excludes any costs that relate specifically to the home sales operation.