Why this is mistaken
Age the controlled gross claims. Compute and reconcile the allowance separately, then present gross less allowance as net receivables.
Where to watch
When this mistake may appear
- Use the net balance from the balance sheet.
- The allowance is already included.
Check your work
Your work may contain this mistake if:
- Ages net receivables.
- Cannot reconcile bucket exposure to gross ledger.
- Applies an allowance to an amount already net of allowance.