The setup of Bad Debt Relief and Recovery includes following
steps:
Specify the accounts for Bad Debt Relief / Recovery and Interim
Tax Accounts in the Chart of Accounts (tfgld0508m000) session. The Account Type of the Tax Accounts must be set to Balance Sheet. The Account Type of the Ledger Account that are used for Bad Debt Relief and
Recovery has to be set to Balance Sheet. However, you can also set the Account Type to Profit & Loss for the Ledger Account used for Bad Debt Relief and
Recovery.
Specify the Transaction Type for Bad Debt Relief / Recovery in
the Transaction Types (tfgld0511m000) session. The Transaction Category and the Transaction Subcategory must be set to Journal Vouchers and Journal.
Specify the following fields on the Bad Debt tab in the ACP Parameters (tfacp0100m000) and ACR Parameters (tfacr0100s000) sessions:
Bad Debt Relief Account
Bad Debt Recovery Account
Transaction Type for Bad Debt Relief
Series for Bad Debt Relief Documents
Specify the Tax Accounts for Bad Debt Relief and Recovery in
the Tax Codes by Country (tcmcs0536m000) session. The ledger account for Bad Debt
Relief and Recovery must be specified in the Posting Data for Single Tax Codes (tfgld0571m000) and Posting Data for Multiple Tax Codes (tfgld0570m000) sessions. For each tax code the
following sales and purchase accounts must be setup:
Tax Account for Bad Debt Relief in Purchase;
Tax Account for Bad Debt Recovery in Purchase;
Tax Account for Bad Debt Relief in Sales;
Tax Account for Bad Debt Recovery in Sales
Note:
You must setup the tax codes for which the bad debt relief / recovery are
required. You must assess the tax codes which are eligible to bad debt
relief/recovery. For each of these tax codes you need to setup the mentioned
purchase and sales accounts.
Verify or adjust Tax Position to declare tax adjustments in correct tax position in the Tax Positions (tfgld0120m000) session. The Tax Adjustment Type in the Relations by Tax Position (tfgld0121m000) session can be used to select applicable tax
transactions for a given tax code.