20 thoughts on “Lecture Notes – Language Of Business

  1. Thanks Jana



    • Murali,

      Thanks. Hope you’ll find it useful. Tell Faisal to read it as well.


  2. Jana,

    The link opens up with a doc title as ” A Gentle and Practical Introduction to Value Investing”. Loved reading this doc again but is it the doc you wanted to share for Language Of Business or I am missing something.

    Thanks a lot

  3. Hi Jana

    It contains only what was there is Part-1 – Joys of Compounding. 61 pages. Am i missing something

    • Ram,

      Take a look at the table of contents. The document contains notes for both lecture 1 and 2.


  4. Thanks Jana…I still have to read lot of your old posts, which I have marked.Thanks again for the good work.

  5. Dear Jana,
    Thanks very much for sharing these notes.

    I am still trying to understand Debit/Credit in accounting parlance. To me, debit meant something was taken from my account. Credit means something was added to my account. In accounting and your notes, I see that it is treated different. Unfortunate for me, I am unable to relate to ‘how value goes up when debiting’.

    Upon reading, I understood that value goes up when debited to ‘DEAL’ (Divident, Earnings, Assets, Losses) and goes up when credited to ‘GIRLS’ (Gains, Income, Revenue, Liabilities, Shareholders’ equity).

    From the journal entries, cash incoming in the case of deferred rent is noted as ‘Credit’ while cash immediate is noted as ‘Debit’. Is it the time of realisation that decide credit or debit? Can you please share your inputs to relate to? The paragraph above categorises and give a formula. But my question is more on when to mark something Credit/Debit.

    Thanks very much.

    • Sundar,

      The equation given below summarizes it all. Everything on the left hand side goes up by debit and down by credit. And everything on the right hand side goes up by credit and down by debit.

      Assets + Expenses =
      [ Liabilities + Contributed Capital +
      Prior Retained Earnings + Revenue ]

      Your bank account is an asset for you and a liability for the bank. From the vantage point of the bank, liability account goes up by credit and down by debit. [Refer to the above equation]. This should answer the question you had on the first line.


  6. Hi Jana, We had met at the Piramal AGM Excellent Post! That was very helpful for me to revise this as i am from an engineering background. I believe that these concepts were there in CFA 1 but it was useful to get a lesson again and especially enjoyed the clarity of your writing. I had one point. I think the mortgage was assumed to be interest only. As I understand that the mortgage would be paid at the end of 30 years in a bullet payment and therefore if the property value is $200,000 then; the sum of $90,000 would need to be deducted before calculating the rate of return. Let me know if there is an error in my line of thinking. Thanks again for putting the effort in writing such structured and eloquent posts. I have learnt from and read many of them. cheers,Nandan

    Date: Thu, 29 Oct 2015 23:26:32 +0000 To: nandan09@hotmail.com

    • Nandan,

      Thanks for the positive feedback. Mortgage payment in most of the cases contains two parts [interest and principal]. During the initial phase most of it will go towards interest. As years progresses most of it will be towards principal. At the end of 30 years you would have paid down everything.

      There are some mortgages that are interest only. In that case what you’re referring to applies.


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