replacement reserve

replacement reserve definition - business

replacement reserve

Funds set aside in escrow to provide for anticipated maintenance expenses and replacement of short-lived assets. For example, a condominium homeowners' association establishes a replacement reserve to pay for heating and cooling equipment, painting, a new roof, and so forth. Also called reserve fund.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

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