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Earnings Allowance

What is 'Earnings Allowance'

Calculation on the net funds available in a checking account and the credit amount can be used to offset all or a portion of monthly service charges. The rate for the earnings allowance is set at the bank's discretion.




Explaining 'Earnings Allowance'

The earnings allowance, or ECR, is not an account by itself. The rate is variable as it is usually based on some percentage of the 13-week T-Bill rate.




Further Reading

Financial analyst assessment of company earnings quality
journals.sagepub.com [PDF]
… accelerated and depreciation accrual(s) allowance bad and debt conservative … methods that permit management discretion in establishing and adjusting certain conservative reserves, allowances and off … Security Analyst Multi-Year Earnings Forecasts and the Capital Market …

Evidence of earnings management from the measurement of the deferred tax allowance accountEvidence of earnings management from the measurement of the deferred tax allowance account
www.tandfonline.com [PDF]
… accelerated and depreciation accrual(s) allowance bad and debt conservative … methods that permit management discretion in establishing and adjusting certain conservative reserves, allowances and off … Security Analyst Multi-Year Earnings Forecasts and the Capital Market …

Earnings management using the valuation allowance for deferred tax assets under SFAS No. 109Earnings management using the valuation allowance for deferred tax assets under SFAS No. 109
onlinelibrary.wiley.com [PDF]
… accelerated and depreciation accrual(s) allowance bad and debt conservative … methods that permit management discretion in establishing and adjusting certain conservative reserves, allowances and off … Security Analyst Multi-Year Earnings Forecasts and the Capital Market …

How has the financial crisis affected earnings management? A European studyHow has the financial crisis affected earnings management? A European study
www.tandfonline.com [PDF]
… accelerated and depreciation accrual(s) allowance bad and debt conservative … methods that permit management discretion in establishing and adjusting certain conservative reserves, allowances and off … Security Analyst Multi-Year Earnings Forecasts and the Capital Market …

1979 Competitive Manuscript Award: Valuation of Earnings Components in the Electric Utility Industry1979 Competitive Manuscript Award: Valuation of Earnings Components in the Electric Utility Industry
www.jstor.org [PDF]
… accelerated and depreciation accrual(s) allowance bad and debt conservative … methods that permit management discretion in establishing and adjusting certain conservative reserves, allowances and off … Security Analyst Multi-Year Earnings Forecasts and the Capital Market …

Do managers use the valuation allowance account to manage earnings around certain earnings targets?Do managers use the valuation allowance account to manage earnings around certain earnings targets?
meridian.allenpress.com [PDF]
… accelerated and depreciation accrual(s) allowance bad and debt conservative … methods that permit management discretion in establishing and adjusting certain conservative reserves, allowances and off … Security Analyst Multi-Year Earnings Forecasts and the Capital Market …

Earnings momentum and earnings managementEarnings momentum and earnings management
journals.sagepub.com [PDF]
… accelerated and depreciation accrual(s) allowance bad and debt conservative … methods that permit management discretion in establishing and adjusting certain conservative reserves, allowances and off … Security Analyst Multi-Year Earnings Forecasts and the Capital Market …

Economic value added, future accounting earnings, and financial analysts' earnings per share forecastsEconomic value added, future accounting earnings, and financial analysts' earnings per share forecasts
link.springer.com [PDF]
… accelerated and depreciation accrual(s) allowance bad and debt conservative … methods that permit management discretion in establishing and adjusting certain conservative reserves, allowances and off … Security Analyst Multi-Year Earnings Forecasts and the Capital Market …

Allowance for uncollectible accounts as a tool for earnings managementAllowance for uncollectible accounts as a tool for earnings management
www.emerald.com [PDF]
… accelerated and depreciation accrual(s) allowance bad and debt conservative … methods that permit management discretion in establishing and adjusting certain conservative reserves, allowances and off … Security Analyst Multi-Year Earnings Forecasts and the Capital Market …

The earnings-price anomalyThe earnings-price anomaly
www.sciencedirect.com [PDF]
… accelerated and depreciation accrual(s) allowance bad and debt conservative … methods that permit management discretion in establishing and adjusting certain conservative reserves, allowances and off … Security Analyst Multi-Year Earnings Forecasts and the Capital Market …

Q&A About Earnings Allowance

Is there an ECR account?

No, there is no ECR account.

What is the definition of income?

Income is defined as consumption and saving opportunity gained by an entity within a specified period of time, which is generally expressed in monetary terms.

How does income differ from net income?

Net income equals revenue minus cost of goods sold.

What are some examples of sources for household or individual income?

Examples include wages, salaries, profits, interest payments and rent.

What are some examples for firm's gross income?

Examples include revenue minus cost of goods sold.

How does the rate for the earnings allowance work?

The rate for the earnings allowance is set at the bank's discretion.

Is it based on some percentage of 13-week T-Bill rate?

Yes, it is usually based on some percentage of 13-week T-Bill rate.

What is the Earnings Allowance?

The Earnings Allowance is a calculation on net funds available in a checking account and the credit amount can be used to offset all or a portion of monthly service charges.