Credit Control - Urgent Query

Elvie Registered Posts: 22 Dedicated contributor 🌟 🐡 🌟
Advise required regarding an old customer whose account was in credit when they stopped purchasing goods from my company. After 6 months the amount left on his account was transferred out to offset against Bad Debts.
2 years later he has contacted us and is asking for the money back. Any ideas on the legal standing?

Thanks for any comments, help.



  • K H
    K H Registered Posts: 81 Regular contributor ⭐ 😼 ⭐
    Bad Debts

    They would certainly be due their money back as i believe they have six years to make a claim for it.

    best wishes
  • Baggybooks
    Baggybooks Registered Posts: 522
    I'm not sure why it would have been used to off-set a bad debt. A bad debt should be dealt with as a bad debt and not just netted off against a cr balance.
  • Monsoon
    Monsoon FMAAT, AAT Licensed Accountant Posts: 4,071 πŸŽ† 🐘 πŸŽ†
    Pay the money back. Absolutely no question.
    Writing it off to bad debts was wrong.
  • Elvie
    Elvie Registered Posts: 22 Dedicated contributor 🌟 🐡 🌟
    Thanks all for your comments.

    Not to worry, the writing off against Bad Debt issue was corrected back in 2006, as was the Bad Debt GL - since then all debtors receive regular statements of their account balance. Sorry for not making it clear but my original message was a bit wordy and I obviously edited it down a little too much. :blushing:

    The point requiring clarification was the total length of time the money - which should have been on the Debtor account - had to be kept for the Debtor to claim it back.

    I apologise again for my badly worded query (as my mother use to tell me "I've only embarrassed myself").

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