Glossary
random enquiry program (REP)
ATO term - A process for selecting tax returns for evaluation that ensures all tax returns have the same likelihood of being chosen.
Real Estate Investment Trusts (REITs)
Trusts providing exposure to the value and rental income from properties owned by the trust.
Realise
Convert assets into cash, often by selling them
Receiver
A registered liquidator appointed by a secured creditor to realise enough of the assets subject to their security interest to repay the secured debt. Less commonly, a court may appoint a receiver to protect the assets or to carry out specific tasks. When ASIC refers to receivers, we mean receivers, receivers and managers and managing controllers (e.g. a person who has control of company property to enforce a debt owed by the company or a person appointed by the court)
Receiver and manager
A receiver who has, under the terms of their appointment, the power to manage the company's affairs
Receivership
An insolvency procedure where a receiver, or receiver and manager, is appointed over some or all of the company's assets
Recognised trustee
Under the ASX Settlement Operating Rules a trustee company within the meaning of State or Territory Trustee Companies legislation or a Public Trustee of a State or Territory.
Reconstruction
An alteration to the issued capital of a company. Includes share splits, consolidations, capital reductions (partial repayments) schemes of arrangement and name changes.
Record date
The date used in determining who is entitled to a dividend or other entitlement associated with a security. Those on the register on the record date are eligible for the entitlement. To allow for settlement of trades, ex-dividend dates and other ex-entitlement dates are usually set to one business day prior to the record date.
Record of Advice (ROA)
A simple document that confirms the advice received from a licensed financial planner or adviser. Similar to a Statement of Advice (SOA) but shorter and less formal. Often given to existing clients to confirm changes to, or implementation of, advice provided in a previous SOA.
Redeemable preference shares
Shares issued on the terms that they may be redeemed by the company at a later date, either by payment out of profits which would otherwise be available for dividends or out of proceeds of a fresh issue of shares.
Redemption
Paying off or cancelling of a debt.
Redraw facility
Gives you access to any extra money you have deposited into your home loan.
Refinance
When you replace or extend an existing loan with funds from either the same or a different bank or financial institution.
Registered liquidator
A suitability qualified person registered by ASIC to practice as a registered liquidator. Only registered liquidators can act as an external administrator of companies
Regulatory risk
The risk that changes in government policy or regulation may affect your benefits e.g. changes in superannuation policy. Changes typically happen after elections or around the time of the Federal Budget. See also taxation risk.
Related company
Company which controls or is controlled by another company via ownership of subsidiaries.
Renounceable rights
Issue of rights where the offeree can choose to take up the rights offered, let them lapse, or trade them on the market. See also rights issue.
Rent to buy
A purchasing arrangement where you rent an item, such as an appliance or piece of furniture, for a specific time. At the end of the rental period, you can continue to rent the item or buy it outright. This should not be confused with rent to buy home ownership schemes which are high risk and often targeted at people who do not qualify for home loans from traditional lenders.
Rental bond
Deposit paid by a tenant to the landlord when renting a property. It's a form of security for the landlord in case you damage the property or owe rent when you move out. The amount varies between different states and territories, but is usually equivalent to at least 4 weeks rent.
Rental income
Income received from an asset that a property trust owns which is then distributed to unit holders.
Renter's insurance
Insurance cover for the contents of a rental home.
Repaid refund
ATO term - Occurs when a refund is repaid into the account, usually when a cheque is returned to us unclaimed.
Report on Company Activities and Property (ROCAP)
A prescribed form required to be completed by the directors and secretary of a company in liquidation, voluntary administration or receivership, giving details of the company's assets and liabilities
Reset date
In relation to Rolling Instalments, the Reset Date is the date upon which the Final Payment for the Loan Amount is reset for the next period.
Responsible entity
A licensed entity or body that operates a managed investment scheme.
Restricted securities
Defined in the Listing Rules as certain types of securities which during the escrow period restrict the holder from disposing of the restricted securities, creating any security interest in them or doing, or omitting to do, any act which would have the effect of transferring effective ownership or control of the restricted securities.
Retirement savings account
An account offered by financial institutions that is used to save money for retirement. These are simple, low cost, low return accounts.
Return, return on investment
Earnings from investments over a given period - usually expressed as a percentage per year of the amount invested.
Reverse mortgage
A type of loan often used in retirement as a way for people to access the equity in their home. The loan amount depends on your age, the value of the home and how it is taken (lump sum, regular payments or draw down as needed). Interest is added to the loan and compounds. The loan does not have to be repaid until the borrower moves out or the house is sold, usually as part of a deceased estate.
Reversionary beneficiary
The person who will receive the balance of your superannuation income stream after you die. This could be your spouse, child or other dependant.
Reward scheme
Offered by credit card providers or retailers, whereby you receive reward points depending on how much you spend. Reward points can then be exchanged for goods and services. Credit cards that offer rewards usually come with higher annual fees and interest charges.
Reweighting, rebalancing
Changing the proportion of the total portfolio which each investment represents.
Rights issue
Privilege granted to shareholders to buy new shares in the same company.
Risk
Chance or probability that an investment will result in a loss to an investor. Can also be referred to as the level of volatility returns attached to a particular investment.
Risk tolerance
The degree of uncertainty you are prepared to accept in relation to investment returns, in particular the extent to which you are prepared to experience a negative investment return while trying to achieve positive investment returns.
Risk_margin
Margin for futures and exchange traded options required to cover the likely one or two day probable worst case movement against the position.
Roll
Close out one position and at the same time open another over the same underlying asset with a later expiry date.
Rolling instalments
Type of instalment, having a longer life (up to 10 years) with a periodic reset date (usually yearly). On the reset date, the issuer may adjust the exercise price (often called the 'Loan Amount' of the Instalment) with the objective of maintaining a desired gearing level.
Routine transaction statement
Statement sent by the Issuer outlining all investor's transactions in that security.
