Visma Net
About write-off setup
Setting up write-off functionality is similar for the direct write-off and allowance methods. To use the functionality of write-offs, you need to configure the following entities:
- General ledger accounts to record balance and credit write-offs to.
- Reason codes to point to the general ledger account and subaccount where write-offs are to be recorded.
- Customer accounts with write-off functionality enabled and write-off limits specified. If these accounts already exist, you just need to change their settings.
In this topic, you will read about setting up write-off functionality and additional information that you may need during configuration.
Write-off process setup
To use the write-off functionality, you perform the following steps:
- You configure the general ledger accounts and subaccounts to be used for writing off
expenses by using the Chart of accounts (GL202500) window as follows:
- For the direct write-off method, you configure an expense account (for instance, the Balance write-off account) and subaccounts (if needed).
- For the allowance method, you configure a contra asset account to accounts receivable (for instance, Allowance for doubtful accounts) and an expense account (for example, Bad debts expense) and subaccounts (if needed).
- In the Reason codes (CS211000) window, you configure reason codes
that point to the general ledger accounts you have configured in Step 1:
- For the direct write-off method, you create a reason code that points to the expense account and subaccount to be used for writing off expenses. You can configure different reason codes to distribute write-offs to different accounts or use one reason code for all such expenses.
- For the allowance method, you create a reason code that points to the contra asset account (Allowance for doubtful accounts) and subaccount. Then you write off bad debts by using this reason code directly from an invoice and make the entries manually for the contra asset account in the Journal transactions (GL301000) window.
For details, see Add a reason code.
- You enable write-off functionality for a group of customer accounts by using the Customer classes (AR201000) window or individually for a customer account by using the Customers (AR303000)window. For details, see Enable or disable write-offs.
After configuration is done, you can:
- Write off balances directly from an invoice when you apply a payment to it by using the Customer payments (AR302000) window.
- Write off balances or credits of several documents at once by using the Write-off balances and credits (AR505000) window.
- Write off balances directly from an invoice when you apply a payment (created to match a bank transaction) to it by using the Process bank transactions (CA306000) window.
Default reason codes
By using the Customer ledger preferences (AR101000) window, you can specify the reason codes to be used by default for writing off credits and balances. The system will fill in the reason codes specified here in the Reason code field in the Write-off balances and credits (AR505000) window, as well as in the Customer payments (AR302000) window, when you select the type of write-off operation.
Related concepts
Manage credit policy - overview
Related tasks
Write off balances and credits
Related windows
