Credit balance
From ACT Wiki
1. Financial accounting.
This is either a liability or capital within the balance sheet, or revenue within the profit and loss account (or income statement).
- Credit balance miscommunication
- A common miscommunication between the functions of accounting and treasury is the different use of debits and credits. Accountants/controllers are used to posting journal entries where from a balance sheet perspective a debit signifies an increase in value, and a credit a reduction in value. However, for treasury staff a credit is an increase in value, and a debit a reduction. This simple difference is often cause for some awkward conversations between both professions.
- The Group Treasurer, An ACT guide to the first 100 days, Page 9.
2. Banking.
In banking a credit balance - in the bank's records - is one which stands in favour of the customer. The bank owes money to the customer.
(Contrasted with a debit balance in the bank's records. Being a balance standing in favour of the bank.)
