write-down


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Write-down

Reducing the book value of an asset if its is overstated compared to current market values.

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-down

(1) To reduce the value of an asset on the books and records of a company because of a decrease in value of that asset. Because of the mechanics of double-entry bookkeeping, writing down an asset has the consequence of reducing income for that time period. The timing of write-downs is therefore critical because of the impact on taxable income, earnings reported to shareholders, asset value, earnings reported to lenders, and other instances. Large companies will often write down assets in a quarter that is already disappointing, in an attempt to get all the bad news over with at the same time.(2) A lender's agreement to accept less than the full principal balance of a loan, usually in recognition of the fact that it won't collect the full balance anyway.

References in periodicals archive ?
Also, this write-down of Mall of Scandinavia does not affect the company's liquidity.
The write-down will reduce excess capital by AUD27m, it said.
Fitch expects the non-payment of interest on this instrument will occur before any of the bank, the group, or the topco breaches the notes' 5.125% CET1 write-down trigger, most probably when Abanca's or AHF's capital ratios approach their supervisory review and evaluation process requirement set at 11.375% for 2018.
restored under any circumstances, including where the relevant write-down
TOM ALBANESE stepped down as the chief executive of Rio Tinto last week, after an announcement that the company expects to recognise $14bn in write-downs.
Microsoft said in a statement that, 'the acquisition did not accelerate growth to the degree anticipated, contributing to the write-down'.
The write-down will not have any effect on company's cash flow or its operative business, but will reduce the shareholders' equity, which stood at EUR50.3m on 30 September 2010, and will be booked as a non-recurring item in the financial statements of 2010
For the second quarter ended April 30, 2009, the company reported a net loss of USD4.7m, or USD.46 per basic share, reflecting an additional USD4.89m after tax, non-cash write-down to reduce the book carrying value of oil and gas properties.
It comes after Ryanair faced record oil prices and a hefty write-down on the value of its investment in rival carrier Aer Lingus.
$1.16 billion on a big goodwill write-down on its newspaper publishing business.
The Craft Brewers Alliance has announced a write-down of the value of the Widmer brand in their annual report.
The quarterly write-down estimate, one of the highest yet for Merrill Lynch, helped sink the company's shares as much as 2.8 per cent and highlighted concerns the broker may need to raise capital.