Zero Balance Account

A zero balance account is a bank account with no available funds. A zero balance account is used for special accounting purposes. A companys zero balance account is used as a vehicle against which debts can be charged for a specific time period before the companys master account pays the debt, leaving the zero balance account once again without funds. As a result, a zero balance account allows a company to efficiently manage cash flow. By employing a zero balance account a company can maintain a separate account for auditing and other control purposes, without the need to tie up funds in each account. Through the use of the zero balance account, corporations and other businesses maintain greater control over the disbursement of their funds while still maintaining the individual integrity of a variety of departments and/or projects.