FW: New Object Code - 5101- Allowance for Bad Debt Expense (A/R)

Wed, 4 Aug 2004 10:17:31 -0500

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New Object Code - 5101- Allowance for Bad Debt Expense (A/R)=20

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As all of you are aware, after the close of each fiscal year, Auxiliary
Accounting is responsible for submitting a detailed report to the Board
of Trustees regarding Bad Debt Expense/Write-Offs for the fiscal year.
Currently, Object Code 5105 is used for Bad Debt Expense (which includes
those who have established an allowance for uncollectible accounts as
well as those who subscribe to the direct write-off method). This
situation makes it very difficult to separate actual direct write-offs
from estimated allowances.

=20

We have established a new object code to record the expense side of the
Allowance for Uncollectible Accounts - 5101.  For those groups who
choose not to establish an allowance for uncollectible accounts (those
using the direct write-off method), please continue to use object code
5105 for your bad debt expense.=20

=20

This new object code will allow us to better distinguish between
expenses (bad debt expenses) of allowance for uncollectible accounts and
bad debt expense related to the direct write-off method. This will also
allow us to identify those groups who are not establishing an allowance
for their uncollectible A/R.=20

=20

We are requesting that all groups with a significant A/R balance and/or
write-offs establish an allowance. If you are unsure how to establish an
allowance, please contact Michael Lewis, for assistance at
lewisma@indiana.edu or Anita Douglas at ajdougla@indiana.edu

=20

Thank you,

Anna K. Jensen, CMA CPA MBA

Indiana University

Financial Management Services

Director, Auxiliary Accounting, Capital Asset Management and Accounts
Receivable

400 East 7th Street  Poplars 539

Bloomington, IN   47405

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Phone: (812) 855-4412

E-mail: anjensen@indiana.edu

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<div class=3DSection1>

<p class=3DMsoNormal><font size=3D3 face=3D"Times New Roman"><span =
style=3D'font-size:
12.0pt'>New Object Code &#8211; 5101- Allowance for Bad Debt Expense =
(A/R) </span></font></p>

<p class=3DMsoNormal><font size=3D3 face=3D"Times New Roman"><span =
style=3D'font-size:
12.0pt'>&nbsp;</span></font></p>

As all of you are aware, after the close of each fiscal year, =
Auxiliary
Accounting is responsible for submitting a detailed report to the Board =
of
Trustees regarding Bad Debt Expense/Write-Offs for the fiscal year. =
Currently,
Object Code 5105 is used for Bad Debt Expense (which includes those who =
have
established an allowance for uncollectible accounts as well as those who
subscribe to the direct write-off method). This situation makes it very
difficult to separate actual direct write-offs from estimated =
allowances.

<p class=3DMsoNormal><font size=3D3 face=3D"Times New Roman"><span =
style=3D'font-size:
12.0pt'>&nbsp;</span></font></p>

We have established a new object code to record the expense side =
of the
Allowance for Uncollectible Accounts &#8211; 5101. &nbsp;For those =
groups who
choose not to establish an allowance for uncollectible accounts (those =
using
the direct write-off method), please continue to use object code 5105 =
for your
bad debt expense.

<p class=3DMsoNormal><font size=3D3 face=3D"Times New Roman"><span =
style=3D'font-size:
12.0pt'>&nbsp;</span></font></p>

This new object code will allow us to better distinguish between
expenses (bad debt expenses) of allowance for uncollectible accounts and =
bad
debt expense related to the direct write-off method. This will also =
allow us to
identify those groups who are not establishing an allowance for their
uncollectible A/R.

<p class=3DMsoNormal><font size=3D3 face=3D"Times New Roman"><span =
style=3D'font-size:
12.0pt'>&nbsp;</span></font></p>

<p class=3DMsoNormal><u><font size=3D3 face=3D"Times New Roman"><span
style=3D'font-size:12.0pt'>We are requesting that all groups with a =
significant
A/R balance and/or write-offs establish an allowance.</span></font></u> =
If you
are unsure how to establish an allowance, please contact Michael Lewis, =
for
assistance at <a =
href=3D"mailto:lewisma@indiana.edu">lewisma@indiana.edu</a> or
Anita Douglas at <a =
href=3D"mailto:ajdougla@indiana.edu">ajdougla@indiana.edu</a></p>

<p class=3DMsoNormal><font size=3D3 face=3D"Times New Roman"><span =
style=3D'font-size:
12.0pt'>&nbsp;</span></font></p>

<p class=3DMsoNormal><font size=3D2 face=3DArial><span =
style=3D'font-size:10.0pt;
font-family:Arial'>Thank you,</span></font></p>

Anna K. =
Jensen, CMA CPA MBA

<p class=3DMsoNormal style=3D'text-autospace:none'><font size=3D3
  face=3D"Times New Roman"><span =
style=3D'font-size:12.0pt'>Indiana</span></font> University</p>

<p class=3DMsoNormal style=3D'text-autospace:none'><font size=3D3
face=3D"Times New Roman"><span style=3D'font-size:12.0pt'>Financial =
Management
Services</span></font></p>

<p class=3DMsoNormal style=3D'text-autospace:none'><font size=3D3
face=3D"Times New Roman"><span style=3D'font-size:12.0pt'>Director, =
Auxiliary
Accounting, Capital Asset Management and Accounts =
Receivable</span></font></p>

<p class=3DMsoNormal style=3D'text-autospace:none'><font size=3D3
  face=3D"Times New Roman"><span style=3D'font-size:12.0pt'>400 East 7th =
Street</span></font>&nbsp;
Poplars 539</p>

<p class=3DMsoNormal style=3D'text-autospace:none'><font size=3D3
  face=3D"Times New Roman"><span =
style=3D'font-size:12.0pt'>Bloomington</span></font>,
 IN&nbsp;&nbsp; 47405</p>

<p class=3DMsoNormal style=3D'text-autospace:none'><font size=3D3
face=3D"Times New Roman"><span =
style=3D'font-size:12.0pt'>&nbsp;</span></font></p>

<p class=3DMsoNormal style=3D'text-autospace:none'><font size=3D3
face=3D"Times New Roman"><span style=3D'font-size:12.0pt'>Phone: (812) =
855-4412</span></font></p>

<p class=3DMsoNormal><font size=3D3 face=3D"Times New Roman"><span =
style=3D'font-size:
12.0pt'>E-mail: <a =
href=3D"mailto:anjensen@indiana.edu">anjensen@indiana.edu</a></span></fon=
t></p>

<p class=3DMsoNormal><font size=3D3 face=3D"Times New Roman"><span =
style=3D'font-size:
12.0pt'>&nbsp;</span></font></p>

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