How and for what purpose are debit debts assessed?

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What is overdue debt? Description and definition of the term

What accounts payable are considered overdue? Accounts payable become overdue on the next day after the payment date specified in the contract has passed. From this moment on, the creditor, in order to protect his interests and rights, can apply to the court. This is done in order to collect the necessary amount of money from the debtor. Accounting receivables are one of the elements of an enterprise's assets. Along with such objects as working capital, equipment, real estate.

Every year, the enterprise must complete an inventory of obligations in order to determine their existence, assess the current state and prospects for closure.

Using the listed documents, it is possible for a lawyer to establish on what basis there was a debt, the date of occurrence, the amount of the obligation and the possibility of paying fines.

This type of promissory note is a problem whereby the date of work is not yet completed or is extended by agreement of the parties.

Overdue accounts receivable: accounting and taxation of individual transactions

The financial condition of organizations is directly related to the fulfillment of the terms of contracts for payment for placed production, goods, work performed, services provided. Every legal entity and businessman has situations where contractors do not repay the debt on time.

Collection of receivables

Overdue receivables arise due to a violation by the buyer of the terms of calculation for the provided assets.

Overdue accounts receivable are “accounts receivable” that are not paid within the time specified in the contract.

Any type of debt from an accounting point of view is the amount or volume of funds that did not arrive in the company's account from contractors for services provided or goods supplied, but who are ultimately available. Not only can financial assets be considered debt, but also property rights. In the control and management of debts, only those debts that correspond to many signs are borne in the category of overdue ones. The main sign is the expiration of payment terms in accordance with the contract. If the contract provided for the introduction of the amount of the debt in specific shares on a monthly basis, then allowing the next injection of funds also allows the debt to be considered late. In many ways, this understanding is due to the fact that a contract may provide penalties for violation of terms in a fixed amount or percentage ratio, in this case it is about penalties. Thus, overdue accounts receivable can bring additional income to the company. The same opportunities are also presented by accounts payable. The expiration of the conditions of the limitation period is the basis for the transfer of a belated creditor and receivables in the category of bad debts. The main sign of delay is the expiration of payment terms in accordance with the contract.

Basis of Bad Debt: Limitation Period Term and Elimination Basis for deeming a receivable as bad is that a bad debt is more difficult to collect and it is easier to copy it. For this purpose, the legislation provides the following grounds: When, according to the debt obligation, the limitation period has expired. According to the Civil Code, this is equal to three years. When the organizational debtor is liquidated or declared bankrupt. When, according to the debt manager of the obligation, proceedings have already been initiated. But after implementing all the actions provided by law, the police officer stops the proceedings, because such a debt cannot be recovered. The category of irrecoverable receivables is adapted to it. The sheriff's deputy may pass such a decision on the grounds of uncertainty about the debtor's location or whether he does not have property and money that are able to be used as a means of paying off the debt obligation.

Assessment report

Based on the results of the work performed, the contractor must provide a report containing data on the actual assessment of current receivables and payables. The instructions for drawing up the document include the following sections:

• title page indicating the details of the customer and contractor;
• information about the customer and appraiser;
• terms used and their definitions;
• standards applied to assessment work, justification for their use;
• description of the subject of assessment;
• analysis of the market situation;
• list of data and documents used;
• determining the value of an object, including on the basis of accounting entries;
• final conclusion;
• coordination of the obtained results.
• applications.

Sections of the report are used depending on the final needs. For internal analysis, a short version of the assessment will be sufficient.

Accounts receivable can be purchased by another interested party

What creditor debts are considered overdue?

Accounts payable become overdue on the day after the payment date specified in the contract has passed. From this point, the creditor can refer to a court case to protect interests and rights. This becomes for the purpose of collecting the required amount of money from the debtor.

In order for the court to accept the claim into consideration, the creditor will have to attach all available evidence as to whether the contract signed between the parties may be valid. The amount that the buyer, and also calls for payment, must pay must, of course, be recorded in it. A contract with the debtor will be a logical confirmation that there was a financial relationship between the creditor and the debtor.

Certain nuances need to be considered by all heads of large organizations: Peculiarities of working against overdue accounts payable. If the company was a debtor due to overdue accounts payable, then this negatively affects the determination of its solvency and financial well-being. If the management of such an organization regularly evades paying the debt in accordance with the contract, then we will be talking about criminal liability. Does it make sense to say that with such an enterprise the general bona fide organization would hardly want to have anything? For many largest companies, the issue of timely payment of accounts payable is the main one. The question is that in the risk of failure to fulfill debt obligations on time, defined in the contract, the organization risks going into default. Many accounting department employees simply forget that it is also possible to make a profit from unresolved debt. Usually the head and the accountant closely monitor what the company has in accounts receivable, but they forget about accounts payable. To show it, it is possible through the business accounts inventory. It is also possible to make a profit from unresolved debt.

Why is an assessment necessary?

The indicator characterizing the timely receipt of payments from counterparties refers to the assets of the enterprise. Taking into account the influence of external factors, it is necessary to periodically evaluate the debt. The proposed actions may be needed in the following cases:

• to identify the real financial value of the organization;
• to analyze activities and find more effective solutions so that the company can continue to work;
• in transactions involving the assignment of rights of claim;
• when resolving mutual claims of counterparties in court and pre-trial procedures;
• implementation of bankruptcy management in case of bankruptcy of the debtor;
• in other cases.

If the assessment shows that collection of existing debts is not hopeless, the asset can be sold. Accounts receivable auctions can also be used for these purposes. But it should be remembered that most often using this method (selling on an exchange) means that the asset will be sold at a low price. Purchasing receivables at auction does not guarantee the seller company a return of the original amount of obligations in full.

The financial indicator of the value of the asset according to accounting entries does not always coincide with its real market value. This factor is influenced by such reasons as the emergence of uncollectible debts, lack of control over the liquidity of the enterprise, and others.

How long can accounts receivable be overdue?

The period of existence of an overdue debit unless it has been secured in terms of the contract that will secure the debtor's obligation, for example with a guarantee or pledge or guarantee, after the transfer of that obligation to the state has been delayed, is doubtful - one about which there is no certainty that it will be repaid.

If there was a period of time spent there, during which it was possible to address the judicial authorities with the corresponding demand, there was a purpose for other reasons, one way or another: force majeure, elimination or death of the debtor, a doubtful debt becomes hopeless, such that collection is no longer possible. Thus, both doubtful and uncollectible types of overdue receivables. The legislator determined the full period of the degree limitation period to be three years. Therefore, do not miss the opportunity to collect debt in legal proceedings. the enterprise must take all measures for this purpose within the specified period, starting its calculation from the moment of formation. In some contracts, their parties do not define the terms of the date of concrete calculations and associate such a term with some event (for example, 3 days after signing the act), or if the contract is signed in a simplified way (exchange of letters, telegrams, delivery based on invoice), do not define it at all. In this case. the calculation period must be determined: or the date of approach of the corresponding event; or the date of expiration of a reasonable period (usually 7 days) after the debtor receives a creditor's demand containing a demand to repay (Article 200. Article 314 of the Civil Code of the Russian Federation).

Debt from previous years

The limitation period may be interrupted, for example, if the customer files a lawsuit to dispute the amount of the debt. If this nuance was not taken into account when writing off the debt, then during the next audit the Federal Tax Service will identify this error and impose a fine for an unreasonable understatement of tax liabilities. The company will have to recover accounts receivable. The wiring is as follows:

Option 1:

• KT007 - recognition of written-off remote control.
• DT62 KT91.1 - debt restored.
• DT50 KT62 - written off DZ.

Option 2:

• DT76 KT91.1 - recognition in “Other income” of the written-off amount.
• KT007 - debt recovery.

The first scheme is used for justified, and the second for erroneous write-off of funds. Restoring accounts receivable from previous years may cause accounting errors. Therefore, after restoration, you should once again calculate other income in accounting and non-operating income in NU. If deviations are identified, changes should be made to the reporting documents.

How debt accumulates in practice

The key to your good relationship with the bank is timely payments for loans. If due to some circumstances it is impossible to do them in you, it roughly follows:

1. The bank will start reminding you about the delayed payment by phone. And he will call not only you, but also (in case you do not answer) all the telephone numbers specified in the credit questionnaire. From the first days of the delay, you must be prepared for a bank representative to call you at home for work and guarantors.

2. After this, written notifications from the bank will arrive at your postal address. This usually happens 2 weeks after the payment delay.

3. After 2-3 months, your debt will be transferred to the collectors in accordance with the agency contract. This means that you should still be surrounded by money, but the collection agency is busy collecting the debt.

4. 10-12 months after late payments, the bank can do the following: sell your debt to collectors in accordance with the assignment agreement or file a lawsuit against you. As a rule, banks choose the right of first refusal as far as they are concerned, this is more favorable. It is in your interests to get there to look after you faster.

According to the logic of banks, during each day payments are delayed, the borrower is obliged to pay, in addition. Different banks impose different penalties, which are often limited only by their imagination. Typically, the penalty for late payment is 0.5 to 1% per day of the amount of the pending obligation. But, in some banks the fines are much more serious.

For example, if your monthly payment is 20,000 rubles, and penalties are 1% per day, then during the day of delay you pay 200 rubles, in 2 days - 402 rubles, in a week - 1442 rubles. A month of delay will cost, in addition, 6956 rub.

And a month after the next payment date arrives, the percentage will already be charged for 46,956 rub (20,000 payments during the first month + 6,596 rubles of fines during the first month + 20,000 payments during the second month).