Hi all, sorry if this is a stupid question. When you include someone in the provision account and if that person surprisingly paid up, why do you not remove him from the provision account? It's like estimating that the person will not pay even though he paid.
Question on Provision for Impairment of receivables
- Thread starter Cr4zyM4tt
- Start date
Depends. If person merely brought account current BUT you have info that person's financial situation has hugely deteriorated then yeah, provide a reserve on him. If person paid you in full 100% then person does not belong in provision acct - but of course his balance would be zero anyway so moot point.