Blog > ETerms: A Comprehensive Glossary for Payment Processing and Accounting Abbreviations

ETerms: A Comprehensive Glossary for Payment Processing and Accounting Abbreviations

By |Published On: August 25th, 2023|

This glossary defines essential terms used in payment processing and accounting. Whether you’re new to the field or well-versed in these subjects, ETerms is your key to understanding accounting and payment abbreviations. Let’s dive in and decode the language together.

3D secure is a security protocol for online card transactions that adds an extra layer of authentication, reducing the risk of unauthorized use and fraud.

Read more about 3D secure →

An account updater service (AU Service) is a service provided by payment processors that automatically updates cardholder account information, such as expiration dates or card numbers, to ensure uninterrupted recurring payments for merchants.

Accounting (ACCT) is the process of recording, summarizing, analyzing, and reporting financial transactions of a business or organization.

Accounts payable (AP) is the outstanding bills or invoices that a business owes to its suppliers or vendors for goods and services purchased on credit.

Read more about Accounts Payable →

Accounts receivable (AR) are the outstanding payments owed to a business by its customers for goods or services provided on credit.

Read more about Accounts Receivable →

Accrual basis (AB) is an accounting method where revenue and expenses are recognized when they are earned or incurred, regardless of when the cash is exchanged.

Accrued expense (AE) is an expense a business has incurred but has not yet paid. It is recorded in the accounting books as a liability until it is settled.

Read more about Accrued Expenses →

Accrued revenue (ARv) is revenue that a business has earned but has not yet received. It is recognized in the accounting books as an asset until it is collected.

An acquirer payment is a financial transaction made by the acquiring bank to the merchant for the value of goods or services sold to customers.

An acquirer processor (Acq Processor) is a payment processor that provides services to acquiring banks, facilitating the processing of payment transactions.

An acquiring bank (Acq Bank) is a financial institution that partners with merchants to enable them to accept customer electronic payments.

An address verification system (AVS) is a security measure used by payment processors to compare the billing address provided during a transaction with the address on file with the card-issuing bank, helping to reduce fraud.

An aging report (AR) is a report that categorizes accounts receivable based on the length of time they have been outstanding, helping businesses monitor and manage unpaid invoices.

Amortization (AM) is the process of spreading out the cost of an intangible asset (such as goodwill) or a long-term liability (such as a loan) over a specific period.

An application programming interface (API) is a software intermediary that delivers a user response to a system and sends the system’s response back to a user.

Read more about APIs →

Asset turnover (AT) is a financial ratio that measures a company’s efficiency in using its assets to generate revenue.

Read more about asset turnover and how to calculate it →

An authorized transaction is a debit or credit card purchase for which the merchant has received approval from the bank that issued the customer’s payment card.

An authorization code (Auth Code) is a unique code provided by the card-issuing bank to indicate that a payment transaction has been authorized.

An automated clearing house (ACH) is a network that facilitates electronic funds transfers and automated payment processing between banks, businesses, and individuals.

Read more about the ACH network →

In accounting, bad debt refers to the portion of accounts receivable that is unlikely to be collected from customers. It is treated as an expense on the income statement and reduces the accounts receivable on the balance sheet.