Bad debts refer to outstanding customer account balances that are not recoverable and must be written off which differs from an account adjustment.

If you follow this process, including Write off a Customer Account as a Bad Debt at the Till, the Till Summary and Previous Takings reports will display amounts written off in a separate credit card without affecting your sales reports.

Example:

All four steps in this process must be followed for pharmacies that use Minfos Accounting. 

If you do not use Minfos Accounting, then only Add a Bad Debts Write Off Credit Card needs to be followed. 

If you are unsure if you use Minfos Accounting, we recommend you follow this entire process.

Once you have followed the steps in this article you can proceed to Write off a Customer Account as a Bad Debt at the Till.

Follow these processes:

• Check the Bad Debts Written Off Chart of Account exists and is set up correctly
• Add the Bad Debts Write Off A.R. Customer 
• Add the Bad Debts Written Off A.R. Product
• Add a Bad Debts Write Off Credit Card

Check the Bad Debts Written Off Chart of Account exists and is set up correctly

From the General Ledger module:

1. Click the Maintenance menu and select 2. Chart of Accounts.

The Chart of Accounts window is displayed.

2. Click Find.

The Search window is displayed.

3. Enter Bad and click Okay.

The Chart of Accounts window is updated and Bad Debts Written Off will be highlighted.

Note: If the Bad Debts Written Off entry does not exist, click Add. The General Ledger Account Entry window is displayed. Enter the details as listed below from step 6. You will need to enter an Account Number. Suggested Account Number is 0406.00 000.

4. Click Change.

The General Ledger Account Editing window is displayed.

5. The Description should be Bad Debts Written Off.

6. The Account Type should be P, update if required.

7. The Class should be 0 Expense, click the dropdown and update if required.

8. The Sub Class should be 1 Operating, click the dropdown and update if required.

9. The Extended Info should be 0 Normal Account, click the dropdown and update if required.

10. Click Okay to save.

11. Click Cancel to exit the General Ledger Account Entry window.

Add the Bad Debts Write Off A.R. Customer 

From the Receivables module:

1. Click the Maintenance menu and select 1. Customers.

The Customer Maintenance window is displayed.

Note: If you are unsure if this step has already been done, click Find and search for Bad Debts. If it already exists, highlight the entry, and click Change. Take note of the Code and Name as these will be needed later when you add a Bad Debts Credit Card.

2. Click Add.

The A.R. Customer Entry window is displayed.

3. In the Code field enter BD00.

4. In the Name field enter Bad Debts Write Off.

5. Click OK to save.

Add the Bad Debts Written Off A.R. Product

From the Receivables module:

1. Click the Maintenance menu and select 2. Products.

The Product Maintenance window is displayed.

Note: If you are unsure if this step has already been done, click Find and search for Bad Debts. If it already exists, highlight the entry, and click Change. Take note of the Code and Name as these will be needed later in the process.

2. Click Add. 

The A.R. Product Entry window is displayed. 

3. In the Product Code field enter ZZ_BAD_DEBTS.

4. In the Sales A/c and Purchases A/c fields enter the Bad Debts Written Off chart of account. You can either enter the Account Number and press [Tab] or enter the Account Name (e.g. Bad Debts) and press [Tab]. The General Ledger Search Window is displayed. Highlight the correct account and click Okay.

5. In the Product Name field enter Bad Debts Written Off.

6. Ensure the Product Type is set to I Services, click the dropdown and update if required.

7.  Click Okay to save. 

8. Click Cancel to close the A.R. Product Entry window.

9. Click Cancel to close the Product Maintenance window.

Add a Bad Debts Write Off Credit Card

From the Retail Till module:

1. Click the Maintenance menu and select 2. Credit Cards.

The Credit Card Maintenance window is displayed. 

Note: If you are unsure if this step has already been done, check List All, and look for ~Bad Debts Write Off or something similar. If it already exists, highlight the entry, and click Change. The Credit Card Editing window is displayed, confirm your entry with the details listed below.

2. Click Add.

The Credit Card Entry window is displayed. 

3. In the Code field enter a two-letter code e.g. BD.

4. In the Card Name field enter ~Bad Debts Write Off. The ~ will ensure the card does not display in the credit card menu for accidental selection or change your credit card sort order.

5. In a Merchant Limit enter an amount e.g. 500.00. If this is left at 0.00 the credit card cannot be used at the Till.

6. In the A/R Customer field enter the Bad Debts A.R. Customer previously added e.g. BD00. This step is NOT required if you do NOT use Minfos Accounting.

7. In the A/R Product field enter the Bad Debts A.R. Product previously added e.g. Bad Debts Written Off in the A/R Product field. This step is NOT required if you do NOT use Minfos Accounting.

8. Click Okay to save. 

9. Click Cancel to close the Credit Card Entry window.

10. Proceed to Write off a Customer Account as a Bad Debt at the Till.