Updated on March 13, 2023
Closed Account is an account that has been terminated and had no further operations or transactions of debits or credits under such accounts. These accounts are also referred to as the closure of temporary accounts in the income statement or the profit and loss statement of an entity and moving the balance of such accounts to permanent accounts in the balance sheet. This activity is usually done at the end of the financial year to ascertain the true and fair picture of the business and to settle any outstanding due.
Closed accounts are also referred to in banking terms as accounts that are no longer operative and are no longer accessible. It can be a normal savings account, credit card account, loan account, etc.