The amounts written off as uncollectible account
receivables were relatively small as the company recovered the allowance amounts for bad and doubtful debt.
For example, a water utility's loss from an uncollectible account
receivable as a result of a major customer's deteriorating financial condition leading to the bankruptcy of that customer subsequent to the statement of net assets date may be indicative of conditions existing at the statement of net assets date, thereby calling for adjustment of the financial statements before their issuance.
For example, if the above parties negotiated the Provision for Uncollectible Account
losses as $1 million, the report should disclose this balance and state that the $1 million, as disclosed in Note X, is not intended to conform with GAAP.
In a similar fashion, the IRS attempted to raise additional revenue by no longer permitting companies to follow the accrual accounting method for bad debts whereby estimates of uncollectible accounts
are made in each period of sales and matched against those sales in the income statement.
As part of the continuing review, principal findings to date include the following: the company did not appropriately reconcile its contractual allowance estimates for discounts and price concessions with cash subsequently received in respect of prior period patient claims, and it did not record a reserve for uncollectible accounts
across all of its payer categories during the Non-Reliance Periods.
CARTI's provisions for uncollectible accounts
dropped 36 percent to $3.7 million in the most recent fiscal year.
Negative rating actions could occur if there is a deterioration of its operating performance and credit profile in the beverage businesses, higher working capital requirements due to uncollectible accounts
at Finbe, or debt-financed acquisition leading to total debt/EBITDA above 2.5x on a sustained basis.
The lender increased the client's line of credit, unaware that the accounts receivable balance included a number of aged and uncollectible accounts
The risk management consists of the input item that is the output of operating performance output item (NPLs) and two output items including nonaccrual loans and allowance for uncollectible accounts
. The network production process structure with NPLs is shown in Figure 2 and the variables are as defined in Table 1.
Go through your uncollectible accounts
from the past three years and tell me how many of those accounts passed the gut check.
1.166-1(e)).Thus, for cash-basis taxpayers, a bad debt deduction is generally not allowed for uncollectible accounts
receivable since these items are normally not included in income until received.