Collection Procedure A collection procedure is a systematic process used by businesses to manage and recover overdue payments from customers. This procedure encompasses a series of actions, from initial contact with the debtor to potentially involving legal measures, aimed at securing payment of outstanding debts while maintaining positive customer relations whenever possible. Effective collection procedures
Collection Agency A collection agency is a business that specializes in pursuing payments of debts owed by individuals or businesses. Typically, these agencies are hired by creditors to collect debts that are past due, ensuring that lenders can recover a portion of the funds that have been loaned out. Collection agencies play a critical role
Collateral Trust Bond A collateral trust bond is a type of secured bond that a corporation issues, backed by a security interest in a pool of financial assets, such as stocks, bonds, or other securities, that the issuer deposits with a trustee. These assets serve as collateral for the bondholders, providing an additional layer of
Coincident Indicator A coincident indicator is a statistic that reflects the current state of the economy in a specific area, moving up or down in tandem with the overall economy. These indicators are used to assess the current economic conditions and help in making informed decisions regarding economic policies and business strategies. In business, coincident
Closing Memorandum A closing memorandum is a comprehensive document that summarizes all the key aspects and final terms of a business deal or transaction. It serves as a formal record that outlines the agreements, conditions, and responsibilities agreed upon by the parties involved at the conclusion of negotiations. In business, the closing memorandum plays a
Closing Balance A closing balance is the amount of money in an account at the end of a financial period. It reflects the net result of all transactions made within that period, serving as the starting balance for the next period. In business, the closing balance is crucial for understanding an entity’s financial health and
Closely Held Corporation A closely held corporation, also known as a closely held company, is a business entity owned by a small group of individuals who are often closely associated with the company, such as family members, relatives, or business partners. These shareholders typically have significant involvement in the company’s management and operations, distinguishing it
Clearing Account A clearing account, also known as a wash account, is a temporary holding account used to move funds from one account to another when direct transfers are not possible or when transactions need to be reconciled before final posting. This intermediary account facilitates the organization and tracking of funds to ensure accuracy in
Clean Opinion A clean opinion, also known as an unqualified opinion, is an auditor’s statement indicating that a company’s financial statements are fairly and appropriately presented, without any identified exceptions, and in accordance with the applicable accounting standards. It is the most favorable opinion an auditor can provide after reviewing a company’s financial records. Businesses
Classified Income Statement A classified income statement is a financial report that separates revenue, expenses, and profits into distinct categories to provide a detailed analysis of a company’s financial performance over a specific period. This classification enhances understanding by breaking down operations into core and non-core activities, allowing for a nuanced assessment of profitability. Businesses