what are disbursements

Disbursements refer to the act of paying out or disbursing money from a fund. Disbursements can be made via cash, checks, vouchers, ACH payments, or digital payment options. Disbursements can refer to many types of cash payments in business, personal finance, and from dedicated funds, including student financial aid funds and operating expenses like rent, interest paid on loans, and cash dividends to shareholders. Disbursements are recorded in the general ledger to show how a business spends money over time. Disbursements can be used in many circumstances, such as while pursuing a legal case, where an attorney must keep a record of disbursements made on behalf of a client. Disbursements paid by an undertaker on behalf of a bereaved family generally include cemetery or crematorium costs, costs for religious worship, and any newspaper announcements. Disbursements may include court fees, counsels fees, fees for medical or other expert reports or search fees in a property transaction. For VAT purposes, disbursements are defined more narrowly and distinguished from recharges like traveling expenses and postage, which are incurred by the business for its own requirements rather than for the customer.