Energy Transformations (Also seen in GCSE Physics 1)
We already know that energy cannot be created or destroyed, only transformed from one type to another and transferred from one thing to another. Eg a speaker transforms electrical energy to sound energy with the energy itself is being transferred to the surroundings.
An isolated (or closed) system means an energy transformation is occurring where none of the energy is lost to the surroundings. In reality all transformations/transfers are not isolated, and all of them waste energy to the surroundings.