RECLASSIFYING OR ADJUSTING RECEIVABLES - 8295

Agencies/departments must perform an analysis of their Accounts Receivables (AR) to verify the correct amounts are recorded. ARs should be reclassified or adjusted in certain situations:

• Legal authority does not exist to bill for the amount owed.
• Sufficient documentation does not exist to substantiate the AR (e.g., debtor name and an invoice or other document identifying the amount owed).
• The validity or amount of the AR is disputed.  

Agencies/departments may reclassify, increase, or decrease the amount of an AR to correct the classification or amount owed by making an adjusting entry with an appropriate description of the reason for the adjustment.

Reclassifying ARs When an Appropriation Reverts

Agencies/departments must reclassify the existing ARs when an appropriation reverts and is not cleared by June 30 to Account 1209900-AR-Other (Legacy Account 1319) and offset by Account 129000-Provision for Deferred Receivables (Legacy Account 1600). See SAM section 10603.