Need more checks and balances in your bookkeeping process? Looking for ways to minimize idle cash balances? A Zero Balance Account (ZBA) might be a good solution for your business.
A zero balance account is used by corporations to eliminate excess balances in separate accounts and maintain greater control over disbursements. Excess funds in the central operating account can be invested to increase returns and maintain liquidity.
How it Works
All funds are deposited into a central operating account. Subsidiary accounts are set up to handle payroll, accounts payable, petty cash or other similar needs. These subsidiary accounts all maintain a balance of zero by automatically transferring funds from the central operating account to cover the checks presented. Since the ZBA is a separate account, a bank statement is generated that lists the account's paid checks and other transactions.
The funding link between the sub and the master account also works in reverse. If deposits are made in the ZBA, the funds will be automatically transferred to the master account.
For more information about our services, call your Pinnacle financial advisor or contact one of our treasury management advisors.