Closed Account

AAA

DEFINITION of 'Closed Account'

In the simplest sense, any account that has been closed out or otherwise terminated, either by the customer or the custodian. From an accounting perspective, closed accounts can also mean an account that is made ready for the new year by closing out the previous year's amount. A legal definition of this term denotes a statement of debits and credits between parties that cannot be altered.

INVESTOPEDIA EXPLAINS 'Closed Account'

Closed accounts can be distinguished from an amount stated account, which remains open to allow for adjustments and set-offs. Many banks automatically close accounts that are overdrawn for a certain period of time, such as 30 days. Some financial institutions will allow customers to reopen closed accounts while others require a new account to be created instead.

RELATED TERMS
  1. Deceased Account

    A bank account, such as a savings or checking account, owned ...
  2. Blocked Account

    An account that is subject to foreign exchange controls in a ...
  3. Account Inquiry

    Any inquiry into an account, whether it be a depositary account ...
  4. Bank

    A financial institution licensed as a receiver of deposits. There ...
  5. General Ledger

    A company's main accounting records. A general ledger is a complete ...
  6. Finance

    The science that describes the management, creation and study ...
Related Articles
  1. Mutual Funds & ETFs

    The Quest To Build A Unified Managed Account

    Find out why the convenient, customizable UMA should be the next big thing in managed money.
  2. Trading Strategies

    What is a margin account?

    A margin account is an account offered by brokerages that allows investors to borrow money to buy securities. An investor might put down 50% of the value of a purchase and borrow the rest from ...
  3. Delivery duty paid (DDP) is a shipping term.
    Investing

    What does DDP Mean?

    Delivery duty paid (DDP) is a shipping term specifying that the seller is responsible for all costs associated with delivery of the goods to the buyer. It is usually used when goods are exported ...
  4. Fundamental Analysis

    What is a good interest coverage ratio?

    Learn the importance of the interest coverage ratio, one of the primary debt ratios analysts use to evaluate a company's financial health.
  5. Fundamental Analysis

    What is a bad interest coverage ratio?

    Understand how interest coverage ratio is calculated and what it signifies, and learn what market analysts consider to be an unacceptably low coverage ratio.
  6. Active Trading Fundamentals

    What is liquidity risk?

    Learn how to distinguish between the two broad types of financial liquidity risk: funding liquidity risk and market liquidity risk.
  7. Technical Indicators

    What is a good gearing ratio?

    Understand the meaning of the gearing ratio, how it is calculated, the definition of high and low gearing, and how they reflect relative financial stability.
  8. Active Trading Fundamentals

    What does the gearing ratio say about risk?

    Find out why lenders and investors pay close attention to a firm's gearing ratios, and why both too much and too little borrowing can be risky.
  9. Investing Basics

    What is considered to be a bad gearing ratio?

    Understand the basics of gearing, including the net gearing ratio, what constitutes a bad gearing ratio and how this figure reflects financial stability.
  10. Fundamental Analysis

    What is the difference between a capital gearing ratio and a net gearing ratio?

    Understand the definition of gearing in the finance industry, the difference between net gearing and capital gearing ratios and how they are interpreted.

You May Also Like

Hot Definitions
  1. Santa Claus Rally

    A surge in the price of stocks that often occurs in the week between Christmas and New Year's Day. There are numerous explanations ...
  2. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  3. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  4. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  5. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  6. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
Trading Center