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Ecommerce Accounting Glossary

Clear, jargon-free definitions for 75+ accounting, ecommerce, and financial file format terms — everything you need to master your books

75+ TermsFree ForeverUpdated 2026

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All Terms A–Z

C
File Format

CAMT.053 (ISO 20022 Bank-to-Customer Statement)

An XML-based bank statement format defined by the ISO 20022 standard, designed to replace MT940. Provides richer, more structured transaction data and is being adopted globally.

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Accounting

Cash-Basis Accounting

An accounting method that records revenue and expenses only when cash is received or paid. Simpler than accrual accounting and commonly used by small businesses and sole proprietors.

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Ecommerce

Chargeback

A forced reversal of a payment initiated by a customer's bank or credit card issuer, typically due to a dispute over fraud, non-delivery, or dissatisfaction. Sellers may also incur a chargeback fee.

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Accounting

Chart of Accounts

A complete listing of every account in a company's general ledger, organized by category (assets, liabilities, equity, revenue, expenses). Serves as the structural backbone of the accounting system.

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Accounting

Contra Revenue

An account that offsets gross revenue, such as sales returns, allowances, or discounts given. Reduces total revenue on the income statement to show net revenue.

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Accounting

Cost of Goods Sold (COGS)

The direct costs attributable to producing or purchasing the goods a business sells, including materials, labor, and shipping. Subtracted from revenue to calculate gross profit.

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Accounting

Credit

An accounting entry that increases liability, equity, or revenue accounts and decreases asset or expense accounts. Always paired with an equal debit in double-entry bookkeeping.

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Accounting

Credit Memo

A document issued by a seller to reduce the amount a buyer owes, typically due to returned goods, billing errors, or negotiated discounts. Creates a credit balance on the customer's account.

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File Format

CSV (Comma-Separated Values)

A plain-text file format that stores tabular data with values separated by commas (or other delimiters). The most universal format for exporting and importing financial data across systems.

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P
Ecommerce

Payment Gateway

A service that authorizes and processes credit card and digital payments for online transactions. Acts as the intermediary between the customer's bank and the merchant's bank.

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Ecommerce

Payment Processor

A company that handles the technical execution of credit card and debit card transactions between the customer, the merchant, and the issuing/acquiring banks. Examples include Stripe and Square.

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Ecommerce

Payout

The net amount a marketplace or payment processor transfers to a seller's bank account after deducting all fees, refunds, and reserves from gross sales.

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Accounting

Payroll Liability

Amounts a business owes for employee compensation, withholding taxes, benefits, and employer tax contributions that have been incurred but not yet paid. Tracked as current liabilities.

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File Format

PDF Bank Statement

A bank statement delivered as a PDF document, typically downloaded from online banking portals. Requires OCR or parsing technology to extract transaction data for import into accounting software.

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Ecommerce

Platform Commission

The percentage or flat fee a selling platform charges on each transaction for providing access to its marketplace and customer base. Similar to a referral fee but used more broadly across platforms.

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Accounting

Profit and Loss Statement (P&L)

Another name for the income statement. Summarizes revenues, costs, and expenses over a reporting period to show whether a business made or lost money.

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S
Accounting

Sales Tax

A consumption tax imposed by state or local governments on the sale of goods and services, collected by the seller at the point of sale and remitted to the taxing authority.

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Ecommerce

Sales Tax Nexus

The specific threshold (physical or economic) that triggers a business's obligation to collect sales tax in a given state. Varies by state and can include office locations, employees, or inventory storage.

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Ecommerce

Seller Central

Amazon's web portal and dashboard where third-party sellers manage their listings, inventory, pricing, orders, reports, and advertising. The primary interface for all FBA and FBM operations.

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Ecommerce

Settlement Report

A periodic report from a marketplace or payment processor that summarizes all transactions, fees, refunds, and the net amount deposited into a seller's bank account.

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File Format

SGML (Standard Generalized Markup Language)

A meta-language for defining markup languages, and the original basis for OFX 1.x file format (before OFX 2.x moved to XML). OFX 1.x files use SGML syntax without closing tags.

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Ecommerce

Shipping Revenue

Income collected from customers to cover shipping and handling costs. May or may not cover actual shipping expenses — the difference affects profitability and should be tracked separately.

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Ecommerce

SKU (Stock Keeping Unit)

A unique alphanumeric identifier assigned to each distinct product or variant for inventory tracking and management. Different sizes or colors of the same product each get their own SKU.

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Ecommerce

Subscription Fee

A recurring monthly or annual charge a platform levies for access to a selling account or premium features. Examples include Amazon Professional ($39.99/mo) and Shopify plans.

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Accounting Fundamentals

Accounting Fundamentals

Core bookkeeping, financial reporting, and tax concepts

Accounting

Accrual Accounting

An accounting method that records revenue when earned and expenses when incurred, regardless of when cash actually changes hands. Required by GAAP for most businesses above a certain size threshold.

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Accounting

Cash-Basis Accounting

An accounting method that records revenue and expenses only when cash is received or paid. Simpler than accrual accounting and commonly used by small businesses and sole proprietors.

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Accounting

Accounts Payable (A/P)

Money a business owes to suppliers, vendors, or creditors for goods or services received but not yet paid for. Recorded as a current liability on the balance sheet.

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Accounting

Accounts Receivable (A/R)

Money owed to a business by customers for products or services delivered but not yet paid for. Recorded as a current asset on the balance sheet.

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Accounting

Balance Sheet

A financial statement that reports a company's assets, liabilities, and equity at a specific point in time. The fundamental equation is Assets = Liabilities + Equity.

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Accounting

Bank Reconciliation

The process of matching transactions in your accounting records against your bank statement to ensure they agree. Catches errors, duplicates, and unauthorized charges.

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Accounting

Chart of Accounts

A complete listing of every account in a company's general ledger, organized by category (assets, liabilities, equity, revenue, expenses). Serves as the structural backbone of the accounting system.

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Accounting

Cost of Goods Sold (COGS)

The direct costs attributable to producing or purchasing the goods a business sells, including materials, labor, and shipping. Subtracted from revenue to calculate gross profit.

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Accounting

Contra Revenue

An account that offsets gross revenue, such as sales returns, allowances, or discounts given. Reduces total revenue on the income statement to show net revenue.

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Accounting

Credit Memo

A document issued by a seller to reduce the amount a buyer owes, typically due to returned goods, billing errors, or negotiated discounts. Creates a credit balance on the customer's account.

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Accounting

Debit

An accounting entry that increases asset or expense accounts and decreases liability, equity, or revenue accounts. In double-entry bookkeeping, every transaction has equal debits and credits.

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Accounting

Credit

An accounting entry that increases liability, equity, or revenue accounts and decreases asset or expense accounts. Always paired with an equal debit in double-entry bookkeeping.

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Accounting

Depreciation

The systematic allocation of a tangible asset's cost over its useful life. Reflects the gradual loss of value of equipment, vehicles, or property and is recorded as a non-cash expense.

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Accounting

Double-Entry Bookkeeping

An accounting system where every financial transaction is recorded in at least two accounts — a debit and a credit — ensuring the accounting equation always balances.

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Accounting

General Ledger

The master record of all financial transactions for a business, organized by account. Every journal entry flows into the general ledger, which is the basis for financial statements.

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Accounting

Gross Profit

Revenue minus the cost of goods sold (COGS). Measures how efficiently a business produces or sources its products before accounting for overhead, taxes, and other operating expenses.

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Accounting

Income Statement

A financial statement showing revenue, expenses, and profit or loss over a specific period. Also called a profit and loss statement (P&L), it measures a company's financial performance.

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Accounting

Journal Entry

A record of a financial transaction in the accounting system, containing the date, accounts affected, amounts, and a description. The fundamental building block of double-entry bookkeeping.

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Accounting

Net Income

Total revenue minus all expenses, taxes, and costs — the "bottom line" of the income statement. Represents the actual profit a business earns after all deductions.

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Accounting

Payroll Liability

Amounts a business owes for employee compensation, withholding taxes, benefits, and employer tax contributions that have been incurred but not yet paid. Tracked as current liabilities.

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Accounting

Profit and Loss Statement (P&L)

Another name for the income statement. Summarizes revenues, costs, and expenses over a reporting period to show whether a business made or lost money.

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Accounting

Retained Earnings

The cumulative net income a business has kept rather than distributing as dividends to owners. Appears in the equity section of the balance sheet and grows over time as the business profits.

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Accounting

Sales Tax

A consumption tax imposed by state or local governments on the sale of goods and services, collected by the seller at the point of sale and remitted to the taxing authority.

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Accounting

Trial Balance

A report listing all general ledger accounts and their debit or credit balances at a specific date. Used to verify that total debits equal total credits before preparing financial statements.

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Accounting

Undeposited Funds

A holding account in QuickBooks that temporarily stores received payments before they are grouped into a bank deposit. Prevents mismatches between individual payments and lump-sum bank deposits.

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Accounting

Write-Off

The removal of an uncollectible receivable or worthless asset from the books by recording it as an expense. Common in ecommerce for bad debts, damaged inventory, or chargebacks.

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Accounting

Fiscal Year

A 12-month period a company uses for financial reporting and tax purposes, which may or may not align with the calendar year. The chosen fiscal year affects when financial statements are prepared.

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Accounting

Accrued Expense

An expense that has been incurred but not yet paid or recorded in the accounts. Recognized under accrual accounting to match expenses with the period in which they were generated.

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Accounting

Amortization

The gradual write-off of an intangible asset's cost (such as patents, trademarks, or software) over its useful life, or the scheduled repayment of a loan principal over time.

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Accounting

1099-K

An IRS tax form issued by payment processors and marketplace facilitators to report gross payment transactions exceeding the federal threshold. Sellers must reconcile this form against their own records at tax time.

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Ecommerce & Marketplace

Ecommerce & Marketplace

Marketplace fees, payouts, multi-channel selling, and tax nexus

Ecommerce

SKU (Stock Keeping Unit)

A unique alphanumeric identifier assigned to each distinct product or variant for inventory tracking and management. Different sizes or colors of the same product each get their own SKU.

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Ecommerce

FBA (Fulfillment by Amazon)

A service where sellers send inventory to Amazon's warehouses and Amazon handles storage, packing, shipping, and customer service. Sellers pay storage and fulfillment fees in exchange.

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Ecommerce

Marketplace Fee

A general term for any fee charged by an ecommerce platform for facilitating a sale, including referral fees, closing fees, and payment processing fees. Directly reduces a seller's net payout.

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Ecommerce

Settlement Report

A periodic report from a marketplace or payment processor that summarizes all transactions, fees, refunds, and the net amount deposited into a seller's bank account.

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Ecommerce

Payout

The net amount a marketplace or payment processor transfers to a seller's bank account after deducting all fees, refunds, and reserves from gross sales.

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Ecommerce

Referral Fee

A percentage-based commission charged by Amazon on each sale, varying by product category (typically 8-15%). It is the primary selling fee on the Amazon marketplace.

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Ecommerce

Fulfillment Fee

A per-unit fee charged by Amazon FBA or similar services for picking, packing, and shipping an order. The fee varies by item size, weight, and whether the product is standard or oversize.

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Ecommerce

Marketplace Facilitator Tax

State tax laws that require the marketplace (e.g., Amazon, Etsy, eBay) — not the individual seller — to collect and remit sales tax on transactions. Now enacted in most US states.

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Ecommerce

Chargeback

A forced reversal of a payment initiated by a customer's bank or credit card issuer, typically due to a dispute over fraud, non-delivery, or dissatisfaction. Sellers may also incur a chargeback fee.

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Ecommerce

Dropshipping

A fulfillment model where the seller does not hold inventory. When a customer places an order, the seller purchases the item from a third-party supplier who ships it directly to the customer.

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Ecommerce

Gross Merchandise Value (GMV)

The total value of all goods sold through a marketplace or storefront over a period, before deducting fees, refunds, taxes, and discounts. A top-line metric for measuring sales volume.

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Ecommerce

Multi-Channel Selling

The practice of listing and selling products on multiple platforms simultaneously (e.g., Amazon, Shopify, eBay, Walmart). Requires careful inventory sync and consolidated bookkeeping.

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Ecommerce

Order Aggregation

The process of combining orders from multiple sales channels into a single system for unified fulfillment, accounting, and reporting. Essential for multi-channel sellers to avoid data silos.

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Ecommerce

Payment Gateway

A service that authorizes and processes credit card and digital payments for online transactions. Acts as the intermediary between the customer's bank and the merchant's bank.

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Ecommerce

Platform Commission

The percentage or flat fee a selling platform charges on each transaction for providing access to its marketplace and customer base. Similar to a referral fee but used more broadly across platforms.

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Ecommerce

Refund

A return of money to a customer for a cancelled order, returned product, or service issue. In accounting, refunds are recorded as contra revenue and reduce the seller's net sales.

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Ecommerce

Shipping Revenue

Income collected from customers to cover shipping and handling costs. May or may not cover actual shipping expenses — the difference affects profitability and should be tracked separately.

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Ecommerce

Seller Central

Amazon's web portal and dashboard where third-party sellers manage their listings, inventory, pricing, orders, reports, and advertising. The primary interface for all FBA and FBM operations.

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Ecommerce

Subscription Fee

A recurring monthly or annual charge a platform levies for access to a selling account or premium features. Examples include Amazon Professional ($39.99/mo) and Shopify plans.

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Ecommerce

Variable Closing Fee

A per-item fee Amazon charges on media products (books, DVDs, video games) in addition to the referral fee. Typically a fixed amount per unit sold in these specific categories.

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Ecommerce

Nexus

A sufficient connection between a business and a state that requires the business to collect and remit sales tax in that jurisdiction. Can be established through physical presence or economic activity.

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Ecommerce

Sales Tax Nexus

The specific threshold (physical or economic) that triggers a business's obligation to collect sales tax in a given state. Varies by state and can include office locations, employees, or inventory storage.

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Ecommerce

Economic Nexus

A sales tax obligation triggered when a seller exceeds a state's revenue or transaction count threshold (e.g., $100K in sales or 200 transactions), even without physical presence in that state.

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Ecommerce

Payment Processor

A company that handles the technical execution of credit card and debit card transactions between the customer, the merchant, and the issuing/acquiring banks. Examples include Stripe and Square.

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Ecommerce

Interchange Fee

A fee paid by the merchant's bank (acquirer) to the customer's bank (issuer) each time a card transaction is processed. Typically the largest component of credit card processing costs.

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File Formats & Import

File Formats & Import

CSV, IIF, QBO, OFX, and other financial data formats

File Format

IIF (Intuit Interchange Format)

A tab-delimited text file format created by Intuit for importing transactions, lists, and budgets into QuickBooks Desktop. Each row type is identified by a keyword header like TRNS, SPL, or ACCNT.

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File Format

QBO (QuickBooks Online / Web Connect)

A variant of the OFX format used by QuickBooks to import bank transactions via Web Connect. Despite the name, QBO files work with both QuickBooks Online and QuickBooks Desktop.

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File Format

OFX (Open Financial Exchange)

An open standard XML-based format for exchanging financial data between institutions, software, and services. Supports bank statements, credit card statements, and investment data.

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File Format

CSV (Comma-Separated Values)

A plain-text file format that stores tabular data with values separated by commas (or other delimiters). The most universal format for exporting and importing financial data across systems.

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File Format

QFX (Quicken Financial Exchange)

Intuit's proprietary variant of OFX used exclusively by Quicken for downloading bank and credit card statements. Structurally identical to OFX but includes Quicken-specific headers.

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File Format

QIF (Quicken Interchange Format)

A legacy text-based format originally developed by Intuit for Quicken. Uses single-character line prefixes to identify field types (D for date, T for amount, P for payee). Largely superseded by OFX/QFX.

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File Format

MT940 (SWIFT Message Type 940)

A SWIFT banking standard for electronic bank statement messages, widely used in Europe, Asia, and Africa. Contains structured transaction data with specific field tags like :61: and :86:.

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File Format

CAMT.053 (ISO 20022 Bank-to-Customer Statement)

An XML-based bank statement format defined by the ISO 20022 standard, designed to replace MT940. Provides richer, more structured transaction data and is being adopted globally.

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File Format

XLSX (Excel Spreadsheet)

Microsoft Excel's default XML-based spreadsheet format. Commonly used by banks and accountants to export or share financial data with formatting, formulas, and multiple worksheets.

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File Format

PDF Bank Statement

A bank statement delivered as a PDF document, typically downloaded from online banking portals. Requires OCR or parsing technology to extract transaction data for import into accounting software.

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File Format

Web Connect

QuickBooks' method of importing bank transactions from a downloaded file (QBO/OFX format) rather than a direct bank feed. The user downloads a file and then imports it manually into QuickBooks.

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File Format

Bank Feed

A direct, automated connection between a bank and accounting software that downloads transactions in real time. Eliminates the need for manual file downloads but is not available at all banks.

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File Format

FITID (Financial Institution Transaction ID)

A unique identifier assigned to each transaction by the bank within OFX/QBO files. QuickBooks uses FITIDs to detect and prevent duplicate transaction imports.

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File Format

SGML (Standard Generalized Markup Language)

A meta-language for defining markup languages, and the original basis for OFX 1.x file format (before OFX 2.x moved to XML). OFX 1.x files use SGML syntax without closing tags.

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File Format

XML (Extensible Markup Language)

A text-based markup language for structuring data with custom tags, used by OFX 2.x, CAMT.053, and many other financial data standards. Human-readable and machine-parseable.

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File Format

Tab-Delimited File

A text file where data fields are separated by tab characters instead of commas. The IIF format and some bank exports use tab-delimited structure for data interchange.

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File Format

Open Financial Exchange (OFX)

The open standard specification (maintained by Intuit, Microsoft, and CheckFree) that defines the OFX and QBO file formats for exchanging financial data between institutions and software.

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File Format

Intuit Interchange Format (IIF)

The full name of the IIF file format developed by Intuit for bulk-importing data into QuickBooks Desktop. Supports transactions, chart of accounts, customer/vendor lists, and items.

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File Format

ISO 20022

An international standard for electronic financial messaging that defines a common platform for payments, securities, and bank statements. CAMT.053 is the bank statement message within this standard.

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File Format

Quicken Interchange Format (QIF)

The full name of the QIF file format, originally created for Quicken. A simple text-based format that predates OFX, still encountered in legacy financial data exports and older software.

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Put These Terms Into Practice

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