FIN 2017-10-03 Item 2A - Resolution - Accounts Receivable Write-Offs

Browse Search

INFORMATIONAL MEMO Page 2 DISCUSSION The proposed amount of the 2017 Cancellation of Accounts Receivable of $9005.25 is $37,675.21 lower than last year's total of $46,680.46. This is attributable to three main factors: • This year we are only writing off one street department invoice in the amount of $498.15. Normally there are multiple street department invoices being written off with much higher dollar amounts. • We are still seeing the positive impact of not issuing or renewing a business license until all past -due debt has been paid to the City. • We are also still seeing a positive impact of having higher false alarm fees. While $25.00 and $50.00 fees were often ignored in the past, since the fees have gone up to $150.00 and $200.00, recipients are paying much more attention to the invoices we send them and timely payments have increased. FINANCIAL IMPACT The financial impact of cancelling $9005.25 will be to reduce our accounts receivable balance by this amount in keeping with Generally Accepted Accounting Principles (GAAP) for writing off bad debt. Please note that while we are writing off the accounts receivable for accounting purposes, the accounts are still being actively worked for collection purposes with the exception of those accounts where a responsible party cannot be identified. Accounts covered by bankruptcy law cannot be pursued. RECOMMENDATION The Council is being asked to approve the annual resolution authorizing the cancellation of Accounts Receivable and to forward this item to the Regular Meeting Consent Agenda of October 16, 2017. ATTACHMENTS Draft Resolution with Attachment A. 2 Z:\Council Agenda Items\Finance\10_3 Finance Committee \Info Memo 2017 AR Writeoffs.doc