- Capital account
financial accounting, the capital account is one of the accounts in shareholders' equity. Sole proprietorships have a single capital account in the owner's equity. Partnershipsmaintain a capital account for each of the partners.
economics, the capital account is one of two primary components of the balance of payments, the other being the current account. The capital account is referred to as the financial account in the IMF's definition; the IMF has a different definition of the term capital account.Fact|date=February 2008 (See balance of payments.)
The capital account records all transactions between a domestic and foreign resident that involves a change of ownership of an asset. It is the net result of public and private international
investmentflowing in and out of a country. This includes foreign direct investment, portfolio investment(such as changes in holdings of stocks and bonds) and other investments (such as changes in holdings in loans, bank accounts, and currencies).
From a domestic point of view, a foreign investor acquiring a domestic asset is considered a capital inflow, while a domestic resident acquiring a foreign asset is considered a capital outflow.
Along with transactions pertaining to non-financial and non-produced assets, the capital account may also include debt forgiveness, the transfer of goods and financial assets by migrants leaving or entering a country, the transfer of ownership on fixed assets, the transfer of funds received to the sale or acquisition of fixed assets, gift and inheritance taxes, death levies,
patents, copyrights, royalties, and uninsured damage to fixed assets.(http://www.investopedia.com/articles/03/070203.asp).
Countries can impose
capital controls to control the flows into and out of their capital accounts. Countries without capital controls are said to have full capital account convertibility.
Net capital outflow
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Look at other dictionaries:
capital account — n. An account that records a business’s capital assets, expenses, and liabilities. The Essential Law Dictionary. Sphinx Publishing, An imprint of Sourcebooks, Inc. Amy Hackney Blackwell. 2008. capital account The … Law dictionary
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capital account — noun 1. (economics) that part of the balance of payments recording a nation s outflow and inflow of financial securities • Topics: ↑economics, ↑economic science, ↑political economy • Hypernyms: ↑account, ↑accounting, ↑ … Useful english dictionary
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capital account — Net result of public and private international investment and lending activities. Bloomberg Financial Dictionary The part of the balance of payments which is due to transactions in long term assets and liabilities, such as when a UK company… … Financial and business terms
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capital account — 1) An account in the financial records of a limited company showing the total amounts for each class of share capital, for example the preference share capital and the ordinary share capital. 2) An account or series of accounts showing the… … Accounting dictionary
capital account — noun a) An account in the net worth section of the balance sheet of an entity such as sole proprietorships and partnerships. In this context, the capital account (or, in cases of more than one owner, the sum of all individual capital accounts )… … Wiktionary