Firmware Confusion

I realise that similar questions may have been asked but both vendors and forums seem to use the word "firmware" to mean either (to use equivalent PC parlance) "bios" or "O/S" - the version of Android sitting on top of a Linux kernel - and the context does not necessarilly make the distinction clear. More rarely they may be referring to "kernel" upgrade.

Personally I view "bios" as firmware and Android as the "system". Sometimes one may need to do the former before the latter can be upgraded!

Any rule of thumb guidlines here?