Writing Off a Balance

The Balance Write-off screen is used to write off a balance from an order line item. You can write off all or part of the line-item’s balance. A write-off is used for an order in which receiving payment is impossible or unlikely. This screen eliminates credit and debit balances on orders that are not collectable or when the balance is too small to warrant further action. If necessary, you can write-off a credit balance in AR. Write-offs must be performed at the line level instead of the order level.

When a receipt is applied to an order (either by a payment, a receipt transfer, or lockbox distribution) after the receipt has been distributed to all order lines to pay off the current balance of each order line (following the rules of receipt distribution based on payment priority), if there is any overpayment amount remaining, then the overpayment amount will be applied to the first order line that has write-off transaction(s) where the write-off was not created from the Advanced Adjustment screen. 

When the overpayment amount is applied to an order line that has one or more write-off transactions, then the write-off transaction(s) will be reversed up to the amount of the overpayment.  If there is still an overpayment amount remaining, then the remaining overpayment amount will be applied to the next order line that has a write-off transaction(s) not created from the Advanced Adjustment screen, and the write-off transaction(s) will be reversed up to either the amount of the overpayment or the amount of the write-off, whichever is less. If there is still an overpayment amount remaining after all order lines have been reversed, then it will be applied to the first order line.

 You cannot write-off a balance for an inventoried product that has not been shipped.

You can access the Balance Write-off screen from the following locations:

Order Financial Analysis screen

·            Order Analysis tab

Customer Financial Analysis screen

·            Order and Transaction Analysis tab

·            Unapplied Receipt tab (as of 7.4.1SP1)

Transaction Structure

Debit Balance Write-off (the customer owes the association money)

Write-offs create type ‘5’ transactions with the following format:

DR       Write-off Account
CR        AR

Credit Balance Write-off (the association owes the customer money)

DR       AR
CR        System Credit Balance Write-off Account

Source of the Accounts

Debit Balance Write-off (the customer owes the association money)

Debit:  The Write-off account is found in Product_Account.Write-off_Account. 

Credit:  The AR account is found at the order_detail level  (Order_Detail.AR_Account).

Credit Balance Write-off (the association owes the customer money)

Debit:  The AR account is found at the order_detail level  (Order_Detail.AR_Account).

Credit:  The System Credit Balance Write-off account is found in app_org_unit.unearned_incomve_account. 

Minimum information needed for the process:

·            Order Number and Line Number

·            Amount

To create a write-off:

1.    From the Order Line-Item Balance Write-Off screen (shown below), select the Line item from the order you want to write off.

2.    Enter the Write-off Amount.
The New Balance updates accordingly.

3.    Select the Transaction Date from the drop-down.

4.    If necessary, enter any Comments.

5.    If necessary, change the Write-off Account associated with the write-off.

6.    Click Write-off Balance.