Accounts receivable may arise due to non-fulfillment of contractual obligations by the supplier. This situation arises in the case when advance amounts were transferred on account of the upcoming delivery, but the supplier did not complete the shipment within the terms stipulated by the contract. This debt after the expiration of the limitation period turns into a bad debt and can be written off.
Instructions
Step 1
Recognize the supplier's debt as unrecoverable. According to clause 77 of Regulation No. 34n of July 29, 1998 on accounting, only in this case the debt can be written off. Bad debts include debts with an expired limitation period, which is three years under Article 196 of the Civil Code of the Russian Federation. Also, such debts include those that cannot be collected from the supplier. This can happen due to the liquidation of the debtor organization or its bankruptcy. In addition, you can write off the debt that even the bailiffs could not collect.
Step 2
Prepare documents that prove the supplier's debt is hopeless. These include: documents for payment of an advance payment, acts of reconciliation of debt, a decision of an arbitration court to liquidate a debtor, an act of a bailiff on the impossibility of collecting a debt, and so on. Supporting documents are grounds for debt cancellation, therefore, must be kept as primary documents at the enterprise for five years.
Step 3
Take an inventory of the accounts receivable of the business and identify the supplier's debts that need to be written off. This procedure is carried out by order of the head of the organization, which is drawn up in the form INV-22. An accounting certificate on the status of accounts receivable and payable is attached to the inventory act, filled out in the INV-17 form. Make a written justification for the need to write off the supplier's debt and issue an order in any form on the implementation of this procedure.
Step 4
Write off the amount of the supplier's debt from the company's balance sheet at the expense of financial results or the amount of the created reserve of doubtful debts. Charge the bad debt amount to unrealized expenses or to repayment through the doubtful debt reserve. To do this, open a credit to the subaccount "Advances issued" on account 60 "Settlements with contractors and suppliers" and a debit on account 91-2 "Other expenses" or account 63 "Provisions for doubtful debts".
