APPROPRIATION ACCOUNT Meaning and
Definition
-
An appropriation account is a financial term used in accounting and budgeting that refers to a specific fund or account set up to track and monitor the use of funds allocated for a particular purpose or program. It is commonly used in government, nonprofit organizations, and large corporations to ensure that resources are allocated and utilized as intended.
The purpose of an appropriation account is to establish a clear and transparent system for tracking the flow of funds and ensuring that they are used for their designated purposes. This helps to maintain accountability and prevent misuse or misallocation of resources. By segregating funds into specific accounts, it becomes easier to monitor and control spending, ensuring that expenditure is in line with the budgetary provisions and authorized activities.
The appropriation account typically includes details such as the amount of funds allocated, the purpose or program for which they are intended, and any restrictions or limitations on their use. It provides a clear record of where funds are being directed and facilitates the preparation of financial reports and budgets.
In summary, an appropriation account is a dedicated fund or account established to track and control the use of allocated funds for specific purposes. It is a vital tool for financial management, ensuring transparency, accountability, and effective resource utilization.
Etymology of APPROPRIATION ACCOUNT
The etymology of the word "appropriation" comes from the Latin word "appropriatio", which is derived from the verb "appropriare" meaning "to make one's own" or "to take possession of". It consists of the prefix "ad-" meaning "to" and "proprius" meaning "one's own" or "belonging to oneself".
The word "account" has its roots in Middle English and Old French, coming from the Latin word "computare", meaning "to calculate" or "to reckon". It originally referred to a record or registry of financial transactions.
When combined, the term "appropriation account" represents a specific type of financial account that records the allocation or assignment of funds for a particular purpose or usage. It indicates the process of setting aside or designating specific funds for a particular use or expenditure.
