Value Proposition: Policy Document + Implementation Mechanism that transforms “provision and write-off” from individual decisions into a documented pathway: AR Aging + Reconciliations → Provisioning / Write-off JEs within JE Log → Adjusted TB → Closing Pack deliverable to the auditor.

In 20 Seconds: What Will You Get?

• A written policy that defines how the doubtful debts provision is calculated based on Aging/documentable risk indicators.
• A write-off mechanism with clear steps: Write-off Request → Attachments → Approval → Entry → Recovery Tracking Post Write-off.
• A Provisioning Calculator template that outputs “provision movements” (Opening/Increase/Write-off/Recoveries/Closing).
• A Reconciliations package that links AR Subledger/Customer Ledger with GL + ties provision movements to their accounts in TB.
• JE Templates (Provision / Write-off / Recovery / Reclass) + recording them within JE Log.
• Ready approval templates: Write-off Request + Approval Matrix + Collection Efforts Log + Dispute Tagging.
• A ready section within the Closing Pack for auditor delivery: Policy + Accounts + Evidence + Indexing.

CTA related to deliverables: You will receive Allowance Policy + Write-off SOP + JE Templates + Closing Pack Insert for Month-End/Year-End with reviewable documentation.

Suitable For

• Financial Controller / Finance Manager seeking established rules for provisions and write-offs defensible to the auditor.
• Head of Accounting / GL Lead needing a clear link between AR Aging and TB and outputting reconciliation entries within JE Log.
• Accounts Receivable Accountant / AR Accountant managing Aging and collections needing approval templates and documentation for write-off steps.

Not Suitable For

• Those seeking a “delinquent debt collection service” or legal follow-up (the product includes policies, templates, and documentation only).
• Those looking for “ready provision numbers” without Aging/Customer Ledger data or without defining internal risk criteria.

Without Policy / With Policy (Quick Comparison)

Before Use: 5 Symptoms Present in Receivables and Provisions

• The provision changes monthly without a clear link to AR Aging or changes in risks.
• Frequent discrepancies between AR Subledger and General Ledger (GL) with no stable Reconciliations.
• Customer write-offs occur without a Collection Efforts Log or without an approval template.
• Recoveries post write-off are not tracked as a process and have no fixed entry/classification.
• At Year-End, there is no delivery file explaining the “provision logic” or showing provision movements and linking them to the TB.

Doubtful Debts Allowance Policy + Write-off Mechanism: Application Method (3 Steps Without Gaps)

Step 1: Preparation and Report Gathering

• Extract AR Aging (by customer + by periods) + Customer Ledger + List of disputes (if any).
• Extract TB/GL for receivables, provisions, and write-offs (AR Control / Allowance / Bad Debts / Recoveries).
• Prepare brief operational information: credit terms, customer caps if any, and collection status for overdue accounts.

Step 2: Reconciliations + Provision Calculation + JE Log

• Implement Reconciliations: link AR Subledger with GL + identify any necessary posting/reconciliation discrepancies.
• Apply the policy approach to Aging (Buckets/Indicators) to output the Provisioning Calculator and provision movements.
• Prepare reconciliation entries: Provision / Reclass / Write-off / Recovery using JE Templates and record them in JE Log (Reason + Support + Approval).

Step 3: Adjusted TB + Impact on Statements + Closing Pack

• Issue Adjusted TB after recording provision/write-off/recovery entries.
• Establish the impact on the statements/disclosures (Net AR balance from provision + provision movements for the period).
• Compile Closing Pack for the receivables section: Policy + Accounts + Approvals + Reconciliations + JE Log References + Indexing of attachments.

Package Components (Clear Inventory)

1. Allowance Policy (Doubtful Debts Allowance Policy)
   • Practical Purpose: Define the provision calculation approach (Aging-based/Indicators) + define “doubtful/bad” + classification rules and handling of disputes and collections.
   • When Used: Month-End for calculating the periodic provision + Year-End for reviewing and documenting the approach and standards for the auditor.
   • Resulting Evidence: Internally approved policy document + appendix detailing required inputs (Aging/Customer info) and who approves.
2. Write-off SOP (Write-off Mechanism and Customer Write-off Controls)
   • Practical Purpose: Documented write-off pathway: Write-off Request + Acceptance criteria + minimum attachments + approval levels + handling of Recoveries post write-off.
   • When Used: When a write-off decision is made (during the month) + within Year-End to clear distressed accounts under fixed controls.
   • Resulting Evidence: Written SOP + clear definition of responsibilities (AR/Finance/Management Approvals) + documented pathway.
3. Provisioning Calculator (Provision Calculation Template + Provision Movements)
   • Practical Purpose: Convert Aging into a calculated provision number + Roll-forward showing provision movements during the period (Opening/Increase/Write-off/Recoveries/Closing).
   • When Used: Month-End for each closing cycle + Year-End to output supported annual movements.
   • Resulting Evidence: Accounts file showing calculation method + linking calculation results to provision accounts in TB.
4. Reconciliations Pack (Receivables and Provision Reconciliations)
   • Practical Purpose: Link AR Subledger/Customer Ledger with GL + tie provision movements to their balance in TB (Control-to-Subledger + Roll-forward Tie-out).
   • When Used: Month-End before finalizing Adjusted TB + Year-End as part of Closing Pack.
   • Resulting Evidence: Reviewable Reconciliation Sheets showing discrepancies and processing steps.
5. JE Templates + JE Log Section (JE Templates + Ready Section for JE Log)
   • Practical Purpose: Standardize entries for Provision/Write-off/Recovery/Reclass and document the reason for the entry, support, and approval within JE Log.
   • When Used: During Month-End/Year-End when recording provisions, write-offs, and recoveries post write-off.
   • Resulting Evidence: Documented entries + reference JE Log linking each entry to relevant attachments.
6. Approval & Evidence Templates (Approval and Documentation Templates)
   • Practical Purpose: Transform “write-off/evaluation decision” into an evidence file: Write-off Request + Approval Matrix + Collection Efforts Log + Dispute Tagging + Recovery Log.
   • When Used: During collection difficulties, prior to write-off, and post write-off when collecting Recoveries.
   • Resulting Evidence: Completed templates + supporting attachments included in the Closing Pack or receivables file.
7. Closing Pack Insert (Ready Section for Delivery within Closing File)
   • Practical Purpose: Compile everything related to provisions and write-offs into “one section” within the Closing Pack instead of scattered files.
   • When Used: Monthly when delivering receivables results + annually for audit files.
   • Resulting Evidence: Delivery Index linking policy + accounts + entries + reconciliations + approvals.

CTA related to deliverables: Policy + SOP + Calculator + Reconciliations + JE Templates + Closing Pack Insert.

What Should Be Included in the Delivery?

• Policy Document: Allowance policy file (Definitions/Scope/Method/Responsibilities/Review Cycle).
• Write-off SOP: Write-off procedure file (Process + Criteria + Authorities + Handling of Recoveries).
• Provisioning Workbook: Provision calculation sheet/file + Roll-forward + linking to TB accounts.
• Reconciliations: Sheets reconciling AR Subledger ↔ GL + Tie-out for provision movements ↔ their balance.
• JE Pack: Provision/Write-off/Recovery JE templates + ready page for documentation within JE Log.
• Approval Forms: Write-off Request + Approval Matrix + Collection Efforts Log + Dispute/Notes Sheet.
• Evidence Index: Indexing of attachments (Support Index) linking each entry/decision to the supporting document.
• Closing Pack Insert: Ready section for inclusion in the Closing Pack (monthly/annually) for auditor/management delivery.

After Application (Two Points Only)

• Operational Outcome for the Team: Month-End cycle for receivables becomes a calculated step: Aging → Calculator → Standardized Entries → Adjusted TB without late adjustments due to lack of provision methodology.
• Control/Audit Outcome (Evidence & Traceability): Every number in the provision has a pathway: sourced from Aging/criteria + Reconciliations + entry in JE Log + approval/template within Closing Pack.

FAQ — Questions Before Purchase

Is the package suitable for any accounting system?

Yes. It relies on common outputs: AR Aging and TB/GL. The difference is only in how reports are extracted and entries are recorded within the system.

Is it suitable for multi-branch companies?

Yes, if you have Aging and Customer Ledger for each branch/entity or Dimension. Provisions and write-offs can be applied at the branch level and then aggregated at the company level within Adjusted TB and Closing Pack.

Is this a complete “Credit Policy”?

No. The package focuses on doubtful debts provision + write-off controls. It can be linked to your internal credit policy through risk indicators and credit limits, but drafting a Credit Approval Workflow is a standalone product.

Does it include delinquent debt collection?

No collection service is provided. However, it includes a Collection Efforts Log and documentation templates used to substantiate collection steps prior to write-off and to prepare the auditor’s file.

What is the minimum data required to get started?

AR Aging + Customer Ledger + TB/GL for AR accounts, provisions, and write-offs. Preferably (if available): Dispute Log, and Write-off/Recoveries history.

Is it suitable for Month-End only or Year-End as well?

For both: Month-End for calculating the periodic provision and recording its entries, and Year-End for reviewing the methodology and outputting annual movements to be included in the Closing Pack for audit.

Is there a template for auditor delivery?

Yes. There is a Closing Pack Insert + Evidence Index linking the policy, accounts, entries, approvals, and reconciliations in one section.

How do I handle Recoveries after write-off?

The package includes a clear process: recording recoveries post write-off (Recovery) as a template + entry (JE Template) + tracking within JE Log and linking it to the customer and attachments.

Ready to Standardize Provisions and Write-offs with Deliverable Outputs?

You will receive: Allowance Policy + Write-off SOP + Calculator + Reconciliations + JE Templates + Closing Pack Insert as a reviewable application package.