Definitions (3)

1. Accounting: To cancel an accounting entry with an equal but opposite entry.
2. Banking: Bank's or other lender's right (called right to offset) to seize a delinquent debtor's (and/or the guarantor's) any account balance in any other bank on obtaining a garnishee order from a court. See also setoff.
3. Futures and options trading: To liquidate a position by entering an equivalent but opposite transaction in the same delivery month. Offsetting cancels the obligation of making (or taking) physical delivery of the underlying commodity or financial instrument. To offset an initial purchase, a sale is made; to offset an initial sale, a purchase is made.

Use offset in a sentence

  • In times of financial stress, the government may make cuts from certain programs in order to offset spending in other areas and balance the budget.

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