write off


Also found in: Dictionary, Thesaurus, Medical, Legal, Idioms, Encyclopedia, Wikipedia.

Write-Off

A reduction in an individual's or a company's income as the result of an expense. For example, an unpayable credit sale may be a write-off for the creditor, especially if the debtor declares bankruptcy. The bankruptcy means that the debtor is unable to pay the debt, which results in a loss of income for the creditor. A write-off may usually be deducted from one's taxable income.

write off

To reduce the balance (that is, the book value of an asset or a group of assets) in an account to zero by recognizing the recorded value as an expense. For example, a firm may write off a technologically obsolete asset shown on its balance sheet as having monetary value. The asset will then be deleted from the balance sheet, and income during the period will be reduced (or losses will be increased) by an equivalent amount. Also called charge off.
Case Study In September 2001 Blockbuster, Inc., announced it would write off $450 million in the value of its videotape inventory. Tapes that, depending on age, had each been carried at a value of $4 to $8 would be valued at $2 under the new policy. In addition, Blockbuster said it would reduce the number of old tapes in each store from 8,000 to 6,000, thereby eliminating a quarter of its inventory of older tapes. More profitable DVD rentals had become an increasing part of Blockbuster's business, and the firm decided to devote more shelf space to these items. The charge, taken against second-half earnings, caused Blockbuster to report a large loss when Wall Street analysts had been expecting positive earnings. The unexpected news caused the firm's common stock to fall in price by over 8% on the day of the announcement.

write off

(accounting) to charge a cost item as an expense in computing a firm's profit or loss. Certain cost items which are fixed assets but which are of insignificant value may still be written off and charged as an expense in their year of purchase.
References in periodicals archive ?
In the UK economy, various periods can be examined showing extremely high rates of write offs by the banks.
When the options eventually expire unexercised, the company must write off the "as-if" deferred tax asset against the APIC pool to the extent of net excess tax benefits.
To help compensate, he's been able to write off part of the the home office he uses for the technical documentation and career-management services he provides on the side.
Asahi Bank, which is to integrate management with Daiwa Bank by the end of the current fiscal year, said Tuesday it plans to write off 400 billion yen, up 300 billion yen.
We want to reassure the taxpayer that we use every recovery tool available to us to collect the maximum amount of council tax possible, and we do not write off debt until all recovery options have been exhausted.
If Dole were to write off every state he's weak in, he'd have to write off every state,'' Raimundo said.
Why not make contributions to qualified charitable organizations and write off the donations on this year's tax returns?
Accordingly, the Company recorded a noncash charge to write off the remaining goodwill balance of $129.
The terms offered by Russia to write off Kyrgyzstan's debt are more beneficial than HIPC triggers, said Finance Minister Marat Sultanov during consideration of the agreement on Kyrgyz debt write-off by Russia at the session of the Parliamentary Committee on International Ties and Interparliamentary Cooperation today.
Sumitomo Trust, which plans to write off 400 billion yen in dud loans, up from 210 billion yen, will fall into a pretax loss of 180 billion yen in a turnaround from an original projection of 20 billion yen in profit.
E[acute accent]--Refinancing: Unlike an original mortgage, you can't write off all the points paid in connection with refinancing in a single year.
LTCB has announced a restructuring plan under which it aims to write off 750 billion yen in bad loans in the fiscal first half ending Sept.