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Is provisions for bad debt credited to the control accounts for companies, because base on what i know doing the paper the provisions for bad debt is show on the face of the balance sheet for sole traders to get the NRV of receivables, however for companies i noticed that i have never seen it done like that. please clarify.
First, be careful of your terminology – we stopped calling it “provision for doubtful debts (it was never called provision for bad debts)” several years ago. It is now called allowance for receivables.
All businesses (whether sole traders or limited companies) have to show net receivables, and also how it is arrived at (total receivables less the allowance for receivables). It is up to the business where they decide to show the detail – either on the face of the Statement of financial position, or as a note to the Statement. Limited companies more usually show it as a note to the accounts, but it is their choice.
(I do suggest that you watch the free lectures on Irrecoverable and doubtful debts, and on limited companies!)
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