Valuation Account (Noun)
Meaning
A reserve fund created by a charge against profits in order to provide for changes in the value of a company's assets.
Classification
Nouns denoting possession and transfer of possession.
Examples
- The company established a valuation account to account for the decline in the value of its investment portfolio.
- A valuation account is used to record the decrease in value of the company's assets due to depreciation or other external factors.
- The valuation account is set up to absorb the losses resulting from the decline in value of the company's inventory.
- As a result of the economic downturn, the company was required to create a valuation account to account for the reduction in value of its assets.
- The auditor reviewed the valuation account to ensure that it accurately reflected the changes in value of the company's assets over the financial period.