Writing Off Bad Debt

Using Receipts to Write-off Bad Debts

In this example, an outstanding balance of NZD7.47 remains on an invoice and the likelihood of it being paid is remote, so it will be written of as a Bad Debt.

The Debtors Aged Balances shows the outstanding amount.

This example will show how a receipt can be used to write this amount off.

The receipt header as been completed as normal - the main difference being that the Bad Debts Receipt Type has been selected.

In the set-up of this receipt type (System > Code Setup > Debtors > Receipt Type in the System Setup User Manual) the General Ledger Bad Debts Write Off Account has been attached.

This means that the postings for this receipt will be:

Credit Debtors
Debit Bad Debts Written Off

Select the historic invoice with the amount to be written off.
Click OK to keep the changes and save or update the entry.
Click Exit to discard any changes.
Check the Receipt.
Click Save to keep the changes.
Click Exit to discard any changes.
Clicking the transaction line in the receipt will open the Receipt Line Screen which allows the receipt values to be edited if required.

The General Ledger Bad Debts Written Off account shows the written off amount debited to the account.

Bad debt amounts will display in the Tour Window as a transaction against the booking. This is because the Bad Debts receipt is a valid booking transaction.