A Formal Letter of Acknowledgement is an official, legally binding document that conveys the sender’s gratitude for a positive experience or transaction. It is generally sent from one party to another when something has been received—for example, after a payment has been completed or a business deal has gone through. This type of letter serves as a record of appreciation, and acknowledges receipt and acceptance of whatever was exchanged between the parties. By writing a formal letter of acknowledgement, both individuals can have proof that their agreement was understood and properly communicated.