Acknowledges dresses no good (4)
I believe the answer is:
owns
'acknowledges dresses no good' is the definition.
I can't tell whether this defines the answer.
'acknowledges dresses no' is the wordplay.
'acknowledges' becomes 'ows' (I can't explain this - if you can you should give a lot more credence to this answer).
'dresses' indicates putting letters inside (dress can mean cover).
'no' becomes 'n' (common abbreviation).
'ows' placed around 'n' is 'OWNS'.
Can you help me to learn more?
(Other definitions for owns that I've seen before include "Admits possession" , "Belongs to" , "Has possession of by right" , "Confesses" , "uses" .)