reserve

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Reserve

An accounting entry that properly reflects contingent liabilities.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Allowance for Doubtful Accounts

Extra funds from sales, or another source, set aside in order to pay off bad debt if and when it arises. The allowance helps a company ward off any potential cash flow problems should its credit sales not be repaid as expected. On financial statements, it is important to note that an allowance for bad debts exists for fiscal conservatism and not because one expects a large amount of bad debt to accumulate. An allowance for doubtful accounts is also called a cushion. Banks call these funds the loan loss reserve. See also: Savings account.

Reserves

Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

reserve

The funds that are earmarked by a firm from its retained earnings for future use, such as for the payment of likely-to-be-incurred bad debts. The existence of such a reserve informs readers of the firm's financial statements that at least a part of the retained earnings will not be available to the stockholders. See also allowance for doubtful accounts, reserve for contingencies.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
By the end of 2018, the township had $2,406,206 in its general assistance reserve fund, which amounts to nearly 2.8 times the
The SEC was given authority to establish a Reserve Fund with the Treasury Department and deposit into the fund up to $50 million annually from registration fees collected from SEC registrants, with a fund balance limit of $100 million.
To ensure fairness, where possible, all owners and occupiers - both current and future - should contribute to the reserve fund equitably.
Sponsors of condominium conversions have always had the obligation to finance the condo's reserve fund. But two recent court decisions have changed the way the funds' minimum requirements are calculated, with major effects on how much money sponsors need to set aside.
In the future, life insurers can utilize the forex reserve fund to offset 50% of their forex loss.
It notes that other Blues studied by Consumers Union had even larger reserve funds, percentage-wise.
Cuomo, who launched a probe in July 2009, alleged that Levy illegally withdrew more than $1.6 million from the reserve fund and failed to make other required contributions, while writing checks for credit card bills, wireless phone payments and payments to his son-in-law, Dan Deutsch, according to the complaint.
Instead of using a basic financial statement, fund accounting allows the users of the financial statements to get a clear picture of the current operations of the CIRA separately from reserve funds or any other funds, as the association deems appropriate.
Murat Salar, a member of the Executive Board of Orion Security Reserve Funds, said on Monday that annual inflation was above 10 percent again.
The Royal accounts showed that the Queen dipped into a reserve fund last year to boost funds by pounds 6m..
99) would create a deficit-neutral reserve fund nearly identical to that proposed in H.R.
For more information on managing reserve funds, check out ASAE's background kit Reserve Funds and Investment Policies.

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