AR glossary
What is Bad debt and write-offs?
Bad debt is money owed that you no longer expect to collect. Writing it off removes it from receivables and records it as an expense.
Example
A distributor shuts down owing ₹4.2 L that has been overdue for 400 days. After recovery attempts fail, the balance is written off.
Why it matters
Most bad debt starts as an invoice nobody followed up on early enough. Watching the 90+ day bucket and broken promises is how you keep write-offs small.
In Creditouch
Write-offs are a formal action with a reason, kept in the audit trail. Cash at risk on the dashboard flags the balances heading that way.
See Dashboard