Restricted Escrow Account Balances
Code: 1123
👁 Views: 144
Account Information
| Financial Statement | Statement of Financial Position |
| Normal Balance | Debit |
Definition
Cash balances held in escrow accounts for a specified purpose, with their use or release subject to the legal or contractual terms governing the account.
Common Journal Entries
Transfer funds to third-party escrow account pending a specific condition
Dr. Escrow Accounts
Cr. Bank Account
📐 IFRS vs US GAAP Accounting Treatment
IFRS
IAS 7
Statement of Cash Flows
US GAAP
ASC 230
Statement of Cash Flows
❓ Frequently Asked Questions
Q: Who owns the funds in an escrow account?
A: The company owns the funds, but their use is restricted until the condition agreed in the escrow agreement is met.