Obsolescence: The decrease in the value of fixed assets, resulting from economic, social, technological or legal changes.

Open Transaction: A transaction that is not completed at the end of the accounting period; a purchase that has not yet been paid for or a sale where payment is yet to be collected when the accounting period ends.

Opening the Books: Every time a business closes the books for a year, it opens a new set. The new set of books will be empty, therefore the balances from the last balance sheet must be copied into them (via journal entries) so that the business is ready to start the new year.

Operating Activities: Transactions and events that enter into the determination of net income.

Operating Assets: Long-term, or non-current, assets acquired for use in the business rather than for resale; includes property, plant, and equipment; intangible assets; and natural resources.

Operating Budget: The plan for the allocation of resources to each department for the budget period (usually one year).

Operating Expenses: Proprietary fund expenses related directly to the fund's primary activities.

Operating Income: The excess of proprietary fund operating revenues over operating expenses.

Operating Lease: A simple rental agreement.

Operating Leverage: The extent to which fixed costs are part of a company's cost structure; the higher the proportion of fixed costs, the faster income increases or decreases with sales volumes.

Operating Performance Ratio: An overall measure of the efficiency of operations during a period; computed by dividing net income by net sales.

Operating Revenues: Proprietary fund revenues directly related to the fund's primary activities. They consist primarily of user charges for goods and services.

Operating System: The operating system of a computer is the software that coordinates the various applications and allows communication among the different subsystems of the computer.

Operations Fund: A master fund established for the purpose of accounting for all resources not accounted for in another fund.

Organizational Structure: Lines of authority and responsibility.

Ordinary Share: This is a type of share issued by a limited company. It carries the highest risk but usually attracts the highest rewards.

Original Book of Entry: A book which contains the details of the day to day transactions of a business.

Other Revenues and Expenses: Items incurred or earned from activities that are outside, or peripheral to, the normal operations of a firm.

Outstanding Checks: Checks that have been written, recorded and given to the payee but has not been received by the bank, paid and returned (usually with the bank statement).

Outstanding Stock: Issued stock that is still being held by investors.

Overdraft: The amount by which checks, drafts or other demands for payments on a bank exceed the amount of the credit against which they are drawn.

Overheads: These are the costs involved in running a business. They consist entirely of expense accounts (e.g. rent, insurance, petrol, staff wages etc.).

Owners' Equity (Net Assets): The ownership interest in the assets of an entity; equal total assets minus total liabilities.