Collection float

Collection float

The period between the time is a check is deposited in an account and the time funds are made available.

Collection Float

1. Synonymous with shares outstanding. A collection float refers to the number of shares an issuing entity has not repurchased and that are available for trade by the general public. Sometimes it is simply known as a float.

2. A deposit into a bank account that has not yet cleared. For example, one may deposit a check for $1,000 from an out-of-state bank. The funds may be posted to the account immediately, but they will not become available to the account holder until the issuing bank honors the check and transfers the funds to the receiving bank. This process can take as long as five business days. See also: Check hold.
References in periodicals archive ?
Books from her personal collection float in a pool of water and hang on a rack to dry.
Specific cash flow areas to consider include reduce days sales outstanding, optimize days payable outstanding, minimize collection float and optimize cash concentration.
Lockbox systems are designed to improve the processing of payments to a local government and accelerate the availability of funds by reducing float--specifically mail, processing, and collection float.
Furthermore, electronic payments minimize collection float and reduce the number of non-sufficient funds checks.
Automated lockbox services allow incoming payments to bypass the corporate back office and go directly to the bank, virtually eliminating mail handling and manual data entry, while enhancing collection float.
This involves, on the collection side, staying on top of collection float, collecting from customers by the end of the credit period, and clearing the checks as quickly as possible.
Treasury management worked out the payment method, the ACH system, with the VAM card company to reduce the collection float for Susee Inc.

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