Why this is mistaken
Accrued interest can be presented separately and can have its own allowance and writeoff elections. Reconcile earned interest to its own balance before applying the entity's supported policy.
Where to watch
When this mistake may appear
- A note has earned interest that has not been collected at the reporting date.
Check your work
Your work may contain this mistake if:
- Adds accrued interest to principal without checking presentation, allowance, nonaccrual, or writeoff policy.