Credit memorandum definition including break down of areas in the definition. Analyzing the definition of key term often provides more insight about concepts. Credit memorandum can be defined as: Notification that the issuer (sender) has credited the recipient’s account in the sender’s records. Credit memorandum is a term that often get people confused about the term credit, the use of credit memorandum often resulting in people assigning more meaning to the term credit. A credit just means the amount on the left side of the ledger, not good or bad. A credit memorandum is a term that is from the creditors side of the books, a credit memorandum means the issuer has credited your accounts on their books. The credit memorandum may be crediting a receivable account on the issuers books, an asset account, an account that goes down when it is credited resulting is the issuers books showing that the recipient owes less money. But on the recipients books this may be reflected by an accounts payable account, an account the requires a debit to go down.
