Current account example sentences

Adding trade in services and net transfers to the trade balance, we get the current account balance.Cheques drawn on savings or current accounts, however, can be refused by anyone as a mode of payment.While the former records both capital and revenue receipts and payments relating to any accounting year, the latter records only revenue items relating to the current accounting year.Provision is made for a known liability or expense pertaining to current accounting period, the amount of which is not certain.A country is said to be in balance of payments equilibrium when the sum of its current account and its non-reserve capital account equals zero, so that the current account balance is financed entirely by international lending without reserve movements.The current account records exports and imports in goods and services and transfer payments.A businessman generally opens a current account with a bank.Bank, do not allow any interest on the balance in current account but charge a small amount, called incidental charges, for the services rendered.An illustrative bank passbook of a current account is shown in figureure The amount of balance shown in the passbook or the bank statement must tally with the balance as shown in the cash book.In April-September 2005-06, the current account deficit of US$13 billion was financed by a capital inflow of US$1 5 billion, the extra capital inflow of US$ 5 billion being added to our stock of foreign exchange.The current account balance is the sum of the balance of merchandise trade, services and net transfers received from the rest of the world.Thus, any current account deficit is of necessity financed by a net capital inflow.Table 1 (given at the end of chapter) shows that there has been a trade deficit throughout the period and a surplus in invisibles except for 1990-9 The current account deficit (which has been observed for 24 years from 1977-78) had started shrinking and turned into surplus from 2001-0 The surplus continued till 2003-04, but turned into a deficit in 2004-0 The large trade deficit could not be bridged by the invisibles surplus.Apart from currency notes and coins, the balance in savings, or current account deposits, held by the public in commercial banks is also considered money since cheques drawn on these accounts are used to settle transactions.A current account deficit is financed by net capital flows from the rest of the world, thus by a capital account surplus.