POSITIVE CONFIRMATION Definition

Bookmark and Share

POSITIVE CONFIRMATION is the positive form of a receivables confirmation asking the customer to respond whether the customer agrees or disagrees with the client's reported receivable balance. The negative form of accounts receivable confirmation asks the client's customer to respond only if the customer disagrees with the balance determined by the client. The negative form is used when controls over receivables are strong and accounts receivable consists of many accounts with small balances. The positive form is used when controls are weak or there are fewer, but larger, accounts.

Learn new Accounting Terms

DIRECT MATERIAL is the cost of raw materials and components that can easily and economically be identified either with individual units of production or with a responsibility center.

YEAR-END DIVIDEND is a payment to stockholders from retained earnings, declared at the end to a business year.

Suggest a Term

Enter Search Term

Enter a term, then click the entry you would like to view.