What are expense receivables? Write-off of accounts receivable for financial results. Types of accounts receivable

Each enterprise, regardless of its form of ownership, keeps records of its own income and expenses. This is important both for huge companies that occupy leading positions in the market, and for entrepreneurs organizing their own small businesses. At the end of the next reporting period, they have to analyze the results obtained from the work performed. But to carry out these final operations, it is necessary to clearly understand how the enterprise lives, what sources it relies on and how it uses existing assets. It is the company’s assets, in particular, accounts receivable, that will be discussed in this publication.

The concept of accounts receivable

Beginning entrepreneurs often do not understand the meaning of this expression, and especially the fact that the debt of debtors is classified as assets, i.e., the property of the company. The explanation here is simple: accounts receivable is debt owed to a company from individuals or legal entities for exported goods, services or other work performed, but not yet paid for.

Accounts receivable on the balance sheet are part of the company's property, i.e. an asset.

In other words, the meaning of this balance sheet line for the company can be formulated with the phrase “We are owed.” At a certain time, these debts are repaid, turning into cash, and increase the amount of money in the company's cash register or in its bank account. Hence the conclusion: accounts receivable on the balance sheet are part of the company's property, i.e. an asset.

How debt is formed

Not a single enterprise can do without the occurrence of such debt, since this is always explained by production necessity: it is profitable for one company to offer its own goods and transfer it, deferring payment, for another - to receive it with the possibility of payment in installments. This is where mutual interest arises:

the debtor company is given a temporary opportunity to use someone else’s working capital (purchased but not yet paid for goods);
The lending company takes advantage of the chance to expand the market for the supply of goods and search for potential buyers.

The structure of accounts receivable also includes the amounts of advances paid to supplier companies as an advance payment for services/goods purchased in the future.

Please note that such transactions must be formalized by drawing up contracts that stipulate the terms and conditions of delivery or acceptance of services, as well as dates and methods of payment. Having explained what accounts receivable is in simple terms, let’s move on and look at how it affects the life of a company.

Since such debts are formed from funds that are diverted from the business turnover of the company, it is necessary to control their growth, ensuring timely collection in accordance with concluded agreements. After all, it is impossible to allow a situation in which debtor enterprises suddenly refuse their obligations and do not pay for or return exported goods. That is why the element of control is extremely important when concluding an agreement and ensuring compliance with its terms by both parties.

Not only contracts for the supply of manufactured products can be the cause of accounts receivable. It can be increased, for example, by the amount of overpaid taxes to the budget or extra-budgetary funds, which will be written off by subsequent transfers of payments.

Another position that is reflected in an increase in the amount of debt is the debts of the enterprise’s personnel for amounts issued on account or for overpaid salaries. Enterprises practice issuing money on account for economic needs to financially responsible persons.

Eg, the storekeeper receives cash to purchase office supplies or purchase technical literature. The amount issued is reflected in the structure of accounts receivable and is repaid only when the employee reports on the costs incurred, listing them in the advance report and attaching to it all documents confirming the fact of acquisitions.

Types of accounts receivable

What are the types of accounts receivable?

Debt is divided into normal and overdue. The normal category of debts includes:

for goods/services for which the final payment deadlines have not yet arrived;
in the form of an advance payment for goods/work transferred by the enterprise on a contractual basis;
employees who received cash for business needs or business trips, but the deadline for reporting on expenses has not yet arrived.

Overdue receivables are debts:

for goods/services for which payment was not received by the company within the terms specified in the agreement;
for issued accountable amounts, if the employee did not report on expenses incurred without submitting an advance report.

The overwhelming majority of overdue debt consists of settlements with counterparties, so we will leave proceedings with accountable persons to the accounting staff, who usually strictly control the financial activities of the company.

Overdue debt is classified into dubious and hopeless. According to Russian law, a debt is considered doubtful if it is not paid within the terms specified in the agreement and is not secured, for example, by a pledge or surety. This is how the Tax Code of the Russian Federation interprets it.

In other words, unpaid obligations raise doubts depending on the business reputation and solvency of the counterparty: a permanent, trusted partner may experience temporary financial difficulties and explain delays in payment, and it is unknown how a client who has not paid for supplies under the first concluded agreement will behave.

Such a doubtful debt becomes a bad debt, i.e., impossible to collect, when the legally established deadlines for filing claims for its collection expire. According to the Civil Code of the Russian Federation, the limitation period corresponds to a three-year period.

There are several factors that trigger the occurrence of bad debts. This:

liquidation of the debtor company;
bankruptcy of an enterprise;
expiration of the limitation period;
the unreality of recovery even by court decision (for example, the organization comes under operational management, although, as a rule, such measures are taken during the bankruptcy procedure);
the presence of funds in the debtor’s account in a bank that is deprived of the opportunity to continue banking activities. It is well known that, at the initiative of the Central Bank of the Russian Federation, dozens of banks are subject to a similar ban, so this factor will have to be taken into account.

If this situation arises, there are two options:

If the Arbitration Court makes a decision to liquidate the bank, and there is no cash to repay the company’s debt, then such debt is recognized as bad and written off as losses. Note that this decision is made on the basis of documents provided by the debtor - court orders, information confirming the lack of funds, etc.;
If the court makes a decision to restructure the bank, then the enterprise has the right to create a reserve for doubtful debts and wait for the situation in the bank and the debtor company to improve.

Accounts receivable using the example of municipalities of the Moscow region

Let us repeat that in the pursuit of conquering new markets and expanding activities, one should not forget about the usual caution and enter into contracts for the supply of goods or services (especially for impressive amounts) with companies that have proven themselves to be solvent partners with a well-known business reputation.

Note that organizations use all possible tools to pay off overdue debts. For example, they provide deferred/instalment payments, conduct barter settlements, use shares and bills.

Reflection of debt on the balance sheet

The financial report takes into account two categories of accounts receivable:

short-term, payment of which is planned within a year. This is the predominant group, since it is extremely rare to offer deferments for more than a year;
long-term, i.e. the expected payment terms of which exceed 12 months.

This division is used in economic calculations when summing up the company’s performance, determining the liquidity, credit and solvency of the company. We will not delve into economic categories; we will only note that an enterprise’s receivables are an important component in the financial and production life of a company, affecting the final result of work and representing a part of the property, the dynamics of which require the necessary control.

According to Glossary.ru:

“Accounts receivable is the amount of debts due to an enterprise from legal entities or individuals as a result of economic relations with them. Debts usually arise from sales on credit.".

In accounting, accounts receivable usually mean property rights, which are one of the objects of civil rights.

According to Article 128 of the Civil Code of the Russian Federation (hereinafter referred to as the Civil Code of the Russian Federation):

“Objects of civil rights include things, including money and securities, other property, including property rights; works and services; information; results of intellectual activity, including exclusive rights to them (intellectual property); intangible benefits."

Consequently, the right to receive receivables is a property right, and itself is part of the organization’s property.

Note that today practically no business entity exists without accounts receivable, since its formation and existence is explained by simple objective reasons:

For the debtor organization, this is the opportunity to use additional, and free, working capital;

For the creditor organization, this is an expansion of the sales market for goods, works, and services.

The formation of receivables is caused by the existence of contractual relations between counterparties when the moment of transfer of ownership of goods (work, services) and their payment do not coincide in time.

The funds that make up the organization's receivables are diverted from participation in economic turnover, which, of course, is not a plus for the financial condition of the organization. An increase in accounts receivable can lead to the financial collapse of a business entity, therefore the accounting service of the organization must organize proper control over the state of accounts receivable, which will ensure timely collection of funds constituting accounts receivable.

A condition for ensuring the financial stability of an organization is the excess of the amount of accounts receivable over the amount of accounts payable.

Accounts receivable are the property claims of an organization to legal entities and individuals who are its debtors.

Accounts receivable can be considered in three senses: firstly, as a means of repaying accounts payable, secondly, as part of the products sold to customers but not yet paid for and, thirdly, as one of the elements of current assets financed from own or borrowed funds.

The company's working capital consists of the following components:

· Money;

· accounts receivable;

· inventories;

· work in progress;

· deferred expenses.

Therefore, accounts receivable are part of the organization's working capital.

As we have already noted, accounts receivable may arise as a result of failure to fulfill contractual obligations, overpaid taxes, collected fees, penalties, issued sums of money.

Accounts receivable can be divided into normal and overdue accounts receivable.

Debt for shipped goods, works, services, the payment period for which has not yet arrived, but ownership has already transferred to the buyer; or an advance payment is transferred to the supplier (contractor, performer) for the supply of goods (performance of work, provision of services) - this is a normal receivable.

Debt for goods, works, services not paid within the period established by the contract constitutes overdue receivables.

Overdue receivables, in turn, may be doubtful and hopeless.

In accordance with paragraph 1 of Article 266 of the Tax Code of the Russian Federation (hereinafter referred to as the Tax Code of the Russian Federation):

“Doubtful debt is any debt to the taxpayer arising in connection with the sale of goods, performance of work, provision of services, if this debt is not repaid within the time period established by the agreement and is not secured by a pledge, surety, or bank guarantee.”

After the expiration of the statute of limitations, doubtful receivables move into the category of bad debt (not real for collection).

According to paragraph 2 of Article 266 of the Tax Code of the Russian Federation:

“Bad debts (debts that are unrealistic for collection) are those debts to the taxpayer for which the established statute of limitations has expired, as well as those debts for which, in accordance with civil law, the obligation has been terminated due to the impossibility of its fulfillment, on the basis of an act of a state body or liquidation organizations."

Accounts receivable that are unrealistic for collection may arise as a result of:

liquidation of the debtor;

bankruptcy of the debtor;

· expiration of the limitation period without confirmation of the debt on the part of the debtor;

· availability of funds in accounts in a “problem” bank. There are two options here:

Ø firstly, if after the arbitration court makes a decision to liquidate the bank there are not enough funds to pay off the receivables, then such receivables are considered unrealistic for collection and, accordingly, must be written off as financial results;

Ø secondly, if instead of liquidating a bank, its restructuring is envisaged, then the organization can create and wait for the bank to restore solvency;

· impossibility for a bailiff to collect the amount of debt by a court decision (for example, the property of an organization is under the right of operational management).

Depending on the expected repayment period, accounts receivable are divided into:

· short-term (repayment of which is expected within a year after the reporting date);

· long-term (repayment of which is expected no earlier than one year after the reporting date).

It should be noted that in relation to overdue receivables, it is advisable to use deferred (installment) payment, make payments in shares, bills, and use barter.

When granting a deferred (installment) payment, it is necessary to take into account the solvency and business reputation of the counterparty.

For all organizations, regardless of their legal form, writing off overdue receivables in the cases that will be described below is a mandatory procedure.

In order to prevent distortion of balance sheet data and ensure the financial stability of the organization, accounts receivable must be claimed. First, the collection of receivables is carried out through a claim procedure, then the collection of receivables takes place in court.

Each organization must exercise control over the state of receivables, record them, and reconcile mutual settlements. When the amount of receivables is identified, it must be presented to the debtor and claimed. If during the limitation period the amount of receivables is not collected or the debtor is liquidated, then the organization writes off the receivables.

An organization can create a reserve for doubtful debts, expecting the debtor to restore solvency. The concept of doubtful debt and the procedure for creating a reserve are given in Article 266 of the Tax Code of the Russian Federation. Thus, doubtful debt is any debt to the taxpayer arising in connection with the sale of goods, performance of work, provision of services, if this debt is not repaid within the time period established by the agreement and is not secured by a pledge, surety, or bank guarantee.

According to paragraph 77 of the Regulations on maintaining accounting and financial reporting in the Russian Federation, approved by Order of the Ministry of Finance of the Russian Federation dated July 29, 1998 No. 34n “On approval of the regulations on maintaining accounting and financial reporting in the Russian Federation”:

“accounts receivable for which the statute of limitations has expired, and other debts that are unrealistic for collection are written off for each obligation based on the inventory data, written justification and order (instruction) of the head of the organization and are charged accordingly to the reserve for doubtful debts or to the financial results from a commercial organization, if during the period preceding the reporting period, the amounts of these debts were not reserved in the manner prescribed by paragraph 70 of these Regulations, or to increase expenses from a non-profit organization.”

At the same time, when applying this legal norm in practice, it is necessary to take into account the following conclusion of the Federal Arbitration Court of Cassation: Current legislation does not contain the obligation of the taxpayer to write off receivables at the moment when the three-year limitation period has expired. The expiration of the statute of limitations is not the only condition for writing off receivables. Such debt must also be written off if it is deemed uncollectible. The unreality of collection is determined independently by the business entity, which is guided by the totality of objective circumstances that have arisen in the course of its activities (Resolution of the Federal Arbitration Court (hereinafter FAS) of the Volga-Vyatka District dated March 9, 2006 No. A43-20240/2005-30-656).

In accordance with paragraph 77 of the Regulations on maintaining accounting and financial reporting in the Russian Federation, approved by Order of the Ministry of Finance of the Russian Federation dated July 29, 1998 No. 34n “On approval of the regulations on maintaining accounting and financial reporting in the Russian Federation”:

“Writing off a debt at a loss due to the insolvency of the debtor does not constitute cancellation of the debt. This debt must be reflected on the balance sheet for five years from the date of write-off to monitor the possibility of its collection in the event of a change in the debtor’s property situation.”

According to Article 12 of the Federal Law of November 21, 1996 No. 129-FZ “On Accounting”, in order to ensure the reliability of accounting data and financial statements, organizations are required to conduct an inventory of property and liabilities, during which their presence, condition and assessment are checked and documented. In this regard, there are Guidelines for the inventory of property and financial liabilities, approved by Order of the Ministry of Finance of the Russian Federation dated June 13, 1995 No. 49 “On approval of guidelines for the inventory of property and financial liabilities” (hereinafter referred to as the Guidelines).

In accordance with clause 1.2. Methodical instructions:

“The organization’s property means fixed assets, intangible assets, financial investments, inventories, finished products, goods, other inventories, cash and other financial assets, and financial liabilities - bank loans, loans and reserves.”

According to paragraph 1.3 of the Methodological Instructions, all property of the organization is subject to inventory, regardless of its location.

Thus, accounts receivable belong to the organization’s property and are subject to mandatory inventory.

The results of the inventory in terms of settlements with buyers, suppliers and other debtors and creditors must be documented in the Inventory Act of settlements with buyers, suppliers and other debtors and creditors in form No. INV-17, approved by Resolution of the State Statistics Committee of the Russian Federation dated August 18, 1998 No. 88 “On approval of unified forms of primary accounting documentation for recording cash transactions and recording inventory results.”

Based on the results of the inventory, doubtful accounts receivable and accounts receivable that are unrealistic for collection are identified, overdue accounts receivable, and statute of limitations for each obligation.

Based on the results of the inventory, in terms of settlements with debtors, an accounting certificate is drawn up, which indicates:

Name, address, TIN of the debtor organization;

Amount of debt;

The basis on which the receivables were formed;

Date of debt formation;

Primary documents confirming the occurrence of debt, their details;

Documents evidencing debt collection, their details.

The act in form No. INV-17 separately reflects the amounts of receivables that were confirmed or not confirmed by debtor organizations.

Next, on the basis of the accounting certificate, the head of the organization, if necessary, issues an order to write off the overdue and (or) unrecoverable amount of receivables. If the organization did not create a reserve for doubtful debts, then the written off receivables, and in the amount in which they are reflected in the accounting records (including VAT), are included in the financial results. In accordance with paragraphs 12 and 14.3 of PBU 10/99 “Expenses of the organization”, approved by Order of the Ministry of Finance of the Russian Federation dated May 6, 1999 No. 33n “On approval of the accounting regulations “Expenses of the organization” PBU 10/99” (hereinafter referred to as PBU 10/99 ), written-off debt is included in non-operating expenses.

Non-operating expenses are the amounts of receivables for which the statute of limitations has expired and other debts that are unrealistic for collection.

Judicial practice proceeds from the fact that for income tax purposes, non-operating expenses include losses from the write-off of receivables for which the statute of limitations has expired, and other debts that are unrealistic for collection if there is documentary evidence of them. This provision is confirmed by Resolutions of the Federal Antimonopoly Service of the Moscow District dated September 22, 2005, dated September 15, 2005 No. KA-A40/8894-05, dated February 16, 2004 No. KA-A40/469-04, dated March 18, 2003 No. KA-A40 /1128-03, dated August 7, 2000 No. KA-A41/3289-00, Resolutions of the Federal Antimonopoly Service of the Ural District dated May 4, 2005 No. Ф09-1748/05-С7 and dated August 1, 2005 No. Ф09-3190/05-С2 , Resolutions of the Federal Antimonopoly Service of the Volga-Vyatka District dated September 15, 2004 No. A31-673/19, dated July 3, 2003 No. A28-2208/03-102/23, Resolutions of the Federal Antimonopoly Service of the Central District dated October 12, 2004 No. A09-6738/04 -13DSP and Resolution of the Federal Antimonopoly Service of the North Caucasus District dated June 22, 2005 No. F08-2677/2005-1084A.

At the same time, I would like to draw the reader’s attention to the court’s conclusion set out in the Resolution of the Federal Antimonopoly Service of the Volga-Vyatka District dated November 10, 2004 No. A82-2756/2004-14, according to which receivables for goods may be included in the reserve for doubtful debts , not paid on time, and in the absence of a written agreement.

“Receivables for which the statute of limitations has expired and other debts that are unrealistic for collection are included in the organization’s expenses in the amount in which the debt was reflected in the organization’s accounting records”(clause 14.3 of PBU 10/99).

Moreover, the right to write off for losses receivables for which the statute of limitations has expired arises in the presence of circumstances indicating the unreality of its collection, which is confirmed by the resolution of the Federal Antimonopoly Service of the Volga-Vyatka District dated May 18, 2004 No. A29-6853/2003A.

So, let's summarize. To recognize an operation to write off receivables as legal, the following documents are required:

· agreement with the debtor organization;

In the absence of an agreement with the debtor, the taxpayer organization must be prepared to defend the legitimacy of its position in the courts. It is positive that the courts in a similar situation side with the taxpayer, see, for example, the above Resolution of the Federal Antimonopoly Service of the Volga-Vyatka District dated November 10, 2004 No. A82-2756/2004-14.

· primary documents confirming the fact of debt (for example, invoices);

· act in form No. INV-17;

· order from the manager to write off the amount of receivables.

The impossibility of repaying the amount of receivables can be confirmed:

Firstly, an extract from the Unified State Register of Legal Entities (USRLE), a certificate from the tax authority on the liquidation of the debtor organization;

Secondly, by a court decision, notification of the bankruptcy trustee (liquidation commission) about the refusal to satisfy the requirements for collection of the relevant debt due to the insufficiency of the property of the liquidated debtor organization;

Thirdly, an act of the bailiff - executor on the impossibility of collecting debt from the debtor organization.

In the presence of the above documents and in the absence of a reserve for doubtful debts, receivables are subject to write-off to financial results as not realizable for collection (bad).

For more information on issues related to the write-off of receivables, you can read the books by the authors of BKR-INTERCOM-AUDIT JSC “Writing off receivables and payables”, “Litigation of receivables. Legal regulation. Practice. Documentation".

When writing off accounts payable for expenses on 401.20 (273) KPS, which one will be correct? Zeros or BP for which the debt arose? We are talking about accounts receivable for expenses with an expired statute of limitations, we write them off from account 206.34. If we had a debt on account 244.2.206.34, we write it off: D. XXX.2.401.20.273 K. 244.2.206.34.660 and increase the off-balance sheet account 04, so with account 401.20 instead of XXX, what is correct to apply? 000 or 244?

Answer

Galina Nefedova answers, expert

When generating account number 2.401.20.273 in the posting for writing off accounts receivable for expenses, indicate the corresponding code of the type of expense for which the debt is written off, that is, in 15-17 digits of account 2.401.20.273 the same code of the type of expense is used as in the corresponding account.
In the situation under consideration, reflect the operation to write off accounts receivable for expenses with the following entry:

Debit ХХХХ0000000000244.2.401.20.273 Credit ХХХХ0000000000244.2.206.34.660 - the unrecoverable debt on advances issued was written off with its simultaneous acceptance on the balance sheet;

Increase in off-balance sheet account 04.

Igor Kuzmin, Advisor to the State Civil Service of the Russian Federation, 3rd class

Natalia Guseva, Director of the Center for Education and Internal Control of the Instituteadditional professional education "International Financial Center", State Advisor of the Russian Federation, 2nd class, Ph.D. n.

How to write off bad receivables

The institution must timely and...

In accounting for budgetary institutions:

Record the write-off of debt that is unrealistic for collection based on the Accounting Certificate () with the following entries.

№	Contents of operation	Account debit	Account credit
In terms of income debt :
1.	Uncollectible debt on income from the sale of goods, finished products, works and services has been written off
		Increase
2.	Uncollectible debt on loans and advances has been written off with simultaneous acceptance of it for off-balance
		Increase
In terms of debt on expenses :
1.	Uncollectible debt on advances issued has been written off
		Increase
2.	Uncollectible debt of accountable persons was written off with simultaneous acceptance of it for off-balance*
		Increase
Regarding debt for damage and other income :
1.	Debt for property damage was written off due to the recognition of the guilty person as insolvent with simultaneous acceptance of it for off-balance
		Increase
2.	The debt was written off due to the recognition of the guilty person as insolvent due to shortages ( with simultaneous acceptance of it for off-balance):
	- Money;
		Increase
	- other financial assets (including monetary documents)
		Increase
3.	Uncollectible debt for compensation of expenses was written off with simultaneous acceptance of it for off-balance
		Increase
4.	Uncollectible debt in the amount of forced seizure was written off with simultaneous acceptance of it as an off-balance sheet. Important: if you decide to write off fines, penalties, penalties in accordance with the law, use account 1.401.10.174
		Increase
5.	Uncollectible debt on other income has been written off with simultaneous acceptance of it for off-balance This includes the reflection of debt on income from the sale of property (except for goods and finished products)
		Increase
X - analytical code of the type of synthetic account of the accounting object. XX - analytical code of the group and type of synthetic account of the accounting object.

This order is established by paragraphs,

2.1. When budgetary institutions maintain accounting records, business transactions in the accounts of the Working Chart of Accounts, approved by the budgetary institution as part of the formation of accounting policies, are reflected:

For analytical accounting accounts, accounts 010000000 "Non-financial assets", with the exception of analytical accounting accounts for accounts 010600000 "Investments in non-financial assets", 010700000 "Non-financial assets in transit", 010900000 "Costs for the manufacture of finished products, performance of work, services", as well as for account 020135000 “Cash documents” and corresponding accounts 040120200 “Expenditures of the current financial year” (040120241, 040120242, 040120270) in 5-17 digits of the account number zeros are reflected, unless otherwise provided by the requirements for the intended purpose of the allocated funds.* For account 42100600 0 “Settlements with the founder” and the corresponding account 040110172 “Income from transactions with assets” in 1-17 digits of account numbers are reflected as zeros.”

KBK		Check	Analytical code KOSGU	Account name
Account number digit
1-14	15-17	18-23	24-26
XXXXX0000000000	000	0.401.20	270	Expenses on transactions with assets

For analytical accounting accounts 0.101.00.0000, 0.102.00.000, 0.103.00.000, 0.104.00.000, 0.105.00.000, for account 0.201.35.000 and for accounts corresponding to them 0.401.20. 241, 0.401.20.242, 0.401.20.270 in 5-17 digits of the account number zeros are reflected, unless otherwise provided for by the intended purpose of the property or funds at the expense of which the property was purchased.*
And for accounts 0.101.00.0000, 0.102.00.000, 0.103.00.000, 0.104.00.000, 0.105.00.000, zeros are also reflected in categories 5-17 when forming balances at the beginning of the year.

Accounts receivable are the financial and commodity assets of a company working for the counterparty as a result of a transaction, agreement, etc. The role of the counterparty can be buyers, contractors and other accountable persons. Accounts receivable relate to the company's property (its assets) and are subject to inventory, regardless of the maturity date.

In simple words, the concept of a company's receivables is the amount of debt that has not yet been returned to the borrower for certain services or goods.

Here is an example of accounts receivable:

The MAX company specializes in the production of building mixtures. He has several debtors (debtors), these are companies that do not have the financial ability to pay for the goods immediately. The two parties enter into an agreement indicating the repayment period of the debt and all the nuances in case of non-fulfillment. Thus, the MAX company, without refusing a loan, will receive economic profit in the future.

2. What is the difference between accounts receivable and accounts payable?

With accounts receivable, your company has debtors, and with accounts payable, you are the debtor. On the one hand, the absence of receivables indicates the company’s caution, since not all debtors ultimately have the opportunity to repay the debt. But even in this case, the company deprives itself of potential income from bona fide counterparties.

Regarding accounts payable, the same story, its high level indicates the company’s problems, and its absence demonstrates the success and payback of the business on its own. But since KZ is third-party capital, it would be foolish not to take advantage of the opportunity to develop at the expense of other people’s investments. It follows from this that it is not the presence itself that matters, but the volume and ratio of receivables and payables.

3. Types of receivables

There are many criteria by which types of receivables can be classified, but we will turn to the main ones.

Depending on the repayment period:

Depending on receipt of payment:

To avoid serious consequences of non-payment of debt, firms create reserves for doubtful debts. The volume of reserves is approved individually, it all depends on the financial situation of the debtor and the likelihood of repayment of obligations. A provision for doubtful debts is established after an inventory has been taken.

4. Enterprise accounts receivable management

There are often situations when an enterprise, in an effort to increase profits, begins to overload itself with debtors, which can ultimately lead to a large amount of unpaid debt and even bankruptcy of the enterprise. Smart managers pay great attention to the volume of debts and maintain strict accounts receivable records using various tools, such as Excel.

Accounts receivable management methods:

Strengthening work with accounts receivable - collecting debts without resorting to the help of judicial authorities.
Balance control and analysis of accounts payable and receivable.
Motivation of sales department employees (regarding taking measures to ensure the fastest possible return of funds from debtors)
Calculation of the real value of the property, taking into account the possibility of its sale.
Creation of a sales system in which payments will be made regularly and guaranteed, for example, a system of discounts for punctual customers.
Calculation of the maximum level of accounts receivable.
Audit of losses from remote work (what profit the company could have received in case of instant payment and use of this money).

With proper control and management of receivables, an enterprise can protect itself as much as possible from the risks associated with non-payment of debts, decreased solvency and lack of working capital.

5. Inventory of accounts receivable

An inventory of accounts receivable is a reconciliation of documents with counterparties, confirmation of the existence of debt and its size. They carry out an inventory before an annual report, a change of chief accountant, during the liquidation or reorganization of an enterprise and in case of emergency situations, such as a fire.

The inventory is carried out on a certain date, the company sends data on the debt to its borrowers, and they must confirm or deny in writing the existence and amount of the debt. This is ideal, but in reality not everything is so smooth, firstly, inventory can take a lot of time, in some companies the indicators reach up to a month. Secondly, not all debtors respond to requests, especially those whose debt has been waiting for a long time to be repaid.

The next problem is resolving data inconsistencies; in this case, you have to reconcile all transactions performed with a given enterprise; this creates particular difficulty if the enterprise is located in another city or, even better, in another country. When sending a certificate of receivables, you need to take into account the fact that an enterprise can be both a debtor and a creditor at the same time. Even if, according to calculations, you turn out to be a debtor, you need to send a statement, indicating the amount of both receivables and payables.

After reconciliations, the company must draw up an inventory report; some set their own form template, or use a standard one, for example: .

6. Accounts receivable turnover

Accounts receivable turnover shows how quickly a company receives payment for goods and services sold.

The accounts receivable turnover ratio shows how effective measures the organization is taking to minimize debt. This metric quantifies how many times a firm has received payment during a period equal to the average outstanding balance from its customers.

*Average accounts receivable balance is calculated as the amount of accounts receivable from customers according to the balance sheet at the beginning and end of the analyzed period, divided by 2.

Turnover formulaaccounts receivable:

Accounts receivable turnover period in days formula:

*TLC in days shows the number of days during which the debt remains unpaid.

As such, there is no norm for the turnover ratio; it will be different for each industry. But in any case, the higher the OPL, the better for the organization, this means that buyers quickly repay the debt.

7. Collection of accounts receivable

Any enterprise faces the problem of non-payment of accounts receivable. Of course, the buyer may have various valid reasons, but who cares? The company wants to recover its money for the goods provided.

Repayment of receivables can be carried out using different methods, for example, hiring the mafia, but if it is legal, then it is better to file a claim or contact the judicial authorities. If you decide to resolve the conflict amicably, you should send a complaint to the debtor to clearly explain your position and find out whether he has any reasonable objections.

When applying for collection of receivables, you must indicate the following points:

Call
Detailed calculation of the amount of debt incurred
Interest calculation
Debt repayment deadline
Warning about going to court

In addition, the claim must be signed by an authorized person, and copies of all documents related to the debt must be attached. If the debtor received your letter (there must be evidence) and did not respond within the established time frame, then with a clear conscience you can go to court demanding the return of receivables.

8. Write-off of accounts receivable

By law, a debt is considered overdue if the statute of limitations on the debt has expired (3 years) and bad debt if the company is unable to pay the debt. On these grounds, the company has the right to write off the debt. The write-off of hopeless overdue receivables is permitted on the final day of the period in which the statute of limitations has passed.

There are two methods for writing off expired accounts receivable. The first is to use the reserve for doubtful debts for this purpose; if a reserve was not provided for this debt, then write it off as financial results. Postings for writing off accounts receivable must be carried out exclusively for each obligation separately. The reason for this may be the results of the inventory, written confirmation or an order from the head of the enterprise.

Sample order to write off accounts receivable: .

Writing off a bad debt is not an actual cancellation of the debt, therefore, for five years after the write-off, receivables are reflected in the balance sheet. And throughout the entire period, you need to monitor the financial condition of the debtor to see if he has the opportunity to repay the debt.

9. Accounts receivable report

It is important for a manager to have an idea of how much funds he can use, when the next receipts will be, and, based on the report, to think through his actions regarding finances. Also, according to the report data, it is possible to assess the receivables of each client, who makes payments responsibly, and who does not even understand the importance of timely payment of the debt.

Sample breakdown of receivables and payables sample:.

10. Sale and purchase of receivables

If you do not have the slightest desire to deal with debtors, but want to return the funds, you can sell the receivables, if there are persons who would be interested in this. Often these are people who themselves have a debt to the debtor. The company has the opportunity to buy receivables at a lower price, at a discount, so to speak, and then present documents to the debtor and demand repayment of the debt at full cost. To sell a debt, the debtor’s consent is not required; it will be enough to notify him of the sale of the debt.

Optimization of the enterprise sales system and minimizing risks in working with receivables and payables

Accounts payable are the debts of an enterprise to counterparties, which were formed on the basis of operating activities. We will tell you in the article how to take them into account and where to reflect them.

What is this article about?:

What does accounts payable consist of?

In accounting, there is no single accounts payable account, because in the process of operating activities the enterprise interacts with many counterparties: suppliers, its own employees, government agencies and non-state funds, and so on.

There are three possible options here:

The first is if accounts payable were incurred by the company as a buyer, and VAT was deducted at the time of purchase. Then there is no need to restore VAT and take it into account in non-operating expenses.

The second is similar to the first, but VAT was not accepted for deduction. Then it is necessary to restore the VAT and take it into account as an expense in non-operating expenses.

Third, if the company, as a seller, incurred accounts payable from the amount of advances received. There is still no uniform solution to this option. On the one hand, Chapter 25 of the Tax Code of the Russian Federation does not provide for the inclusion of VAT previously paid to the budget on advances as part of non-operating expenses. But on the other hand, there is no clear prohibition on including such VAT in expenses and in accordance with clause 20 of clause 1 of Art. 265 of the Tax Code of the Russian Federation, you can prove your position in court. It's up to you to decide if the game is worth the candle.

Are accounts payable good or bad?

There is no clear answer to the question: is it good or bad to increase accounts payable? In order to formulate the correct answer, you need analyze the company's balance sheet in general and determine liquidity.

Because increasing accounts payable has its disadvantages:

a general increase in the financial dependence of the enterprise on contractors (see, );
deterioration of the enterprise's liquidity;
reduction in credit rating;
possible penalties for late payment to the creditor;
other penalties.

So are the advantages:

As a rule, interest is not accrued on accounts payable, so the use of counterparties’ money is conditionally “free”;
if an enterprise receives advances from customers for goods or services, then this is also accounts payable, then see the paragraph above;
with well-structured management of accounts payable, the company has deferred payments under construction contracts and thereby shortens the financial cycle (read “does not withdraw funds from circulation”;
With an automated payment management system, the risk of missing the payment date and receiving penalties from the counterparty is minimal.

Therefore, do not strive to reduce accounts payable at any cost; approach the problem comprehensively.

We examined the most frequently arising questions regarding the reflection of accounts payable in the balance sheet of an enterprise. To explore this topic further, read the following sources: