According to a recent survey, the overwhelming majority of companies
already have a policy in place under which small dollar "nuisance" deductions
are written off by cash application - rather than being charged back.
The reason that companies have such a policy in place is that in a
cost/benefit analysis creditor companies are often far better of writing
off small deductions than taking the time to research and resolve them.
There are a number of reasons why this is true, including:
Other factors to consider when trying to decide if writing off deductions
is appropriate include:
The current backlog of outstanding deductions/chargebacks
The time it currently takes before deductions can be addressed
The credit department's current staffing level
The amount of cooperation you receive from other departments in
researching deductions to determine whether you
Once all of these factors have been evaluted, the credit manager
should be able to make a recommendation to senior management relating
to the question of whether writing off deductions can be justified.
Of the companies that write off nuisance deductions, the median write
off allowed is between $30 and $40. This dollar figure is not right
for every company, but some dollar amount is right for most creditor