Open topic with navigation

Write off customer account

To write off an account

Open: Sales Ledger > Sales Accounts > Write Off Account.

1. Display the customer account you want to write off.
2. Enter the Goods value you want to write off. The ledger automatically calculates the Tax value for you.
3. Select the Nominal A/C you want to use to write off the tax element of the balance.

If you are using cost centre breakdown for balance sheet postings, you only need to specify the account number reference for the tax write off account. The necessary cost centre and department codes are attached automatically from the account header record.

Note: You can choose to cost centre breakdown in the Accounting System Manager System settings Operational settings tab.

If you are not using cost centre breakdown for balance sheet postings, you must specify the full nominal account for tax write offs, including cost centre and department codes.

Example

If your nominal accounts are set up as follows (the first three accounts listed below are set up in default nominal accounts, and the fourth is set up on the customer account record):
	Bad debt write off		68100			(profit and loss)
	Default tax output		26100	ADM	ADM	(balance sheet)
	Debtors control		14100	ADM	ADM	(balance sheet)
	Default nominal account		31100	SAL	ADM
If you write off a customer account transaction for the following value (with the standard VAT rate set to 17.5%):
	Net	10000.00
	Tax	1750.00
	Gross	11750.00
The nominal posting results will be as follows:
	If cost centre breakdown is not selected
	Bad debt write off	Dr	10000.00	68100	SAL	ADM
	Default tax output	Dr	1750.00	26100	ADM	ADM
	Debtors control	Cr	11750.00	14100	ADM	ADM
	If cost centre breakdown is selected
	Bad debt write off	Dr	10000.00	68100	SAL	ADM
	Default tax output	Dr	1750.00	26100	SAL	ADM
	Debtors control	Cr	11750.00	14100	SAL	ADM
Note: The nominal account codes specified must exist in the Nominal Ledger.

4. Enter the Transaction Analysis code if needed.

Note: You must have selected to Use additional transaction analysis in the Sales Ledger settings Options tab and in the Accounting System Manager.

5. To set the account balance to zero, click Write Off.

Go to top