In accordance with the law, a debtor is a debtor, which can be both a citizen (individual) and an organization (legal entity), as well as an economic entity that has a debt.
Accounts receivable and payable. The concepts
Currently, the debts of participants in economic relations have become a large part of the entire system of economic and economic turnover. Obligations of this kind in modern times are considered as an integral element and the need for financial calculations.
Debt can be payable and receivable. These are the main types of debt. Participants in receivables and payables are, respectively, debtors and creditors. The concept of this kind of debt obligations needs to be formulated in more detail.
Accounts receivable is the amount consisting of debts owed to the organization as a result of its interaction with other organizations or individuals in the economic sphere. The presence of such debts means that the funds of the enterprise to which they owe are not used by themselves, but by the party that should.
Accounts payable refers to the amount levied by the debtor in favor of another person to whom it is necessary to repay the debt. This debt obligation arises when the agreed time for payment of the obligation, payment for the purchased goods, received services has expired, and the payment has not been completed. The difference from the receivable is that the debtor uses funds that do not actually belong to him, that is, funds that are debt to him.
Common features and differences
Accounts receivable and payable are common and distinct from each other. The common thing is that both debt obligations are based on the time gap between performance and payment. Such a process is the failure to fulfill the function of cash as a means of payment.
The difference in debts are the features of their functioning as varieties of obligations representing debt.
The difference between a debtor and a creditor
In order to understand the distinguishing characteristics, it is necessary to determine that the debtor is a person who has a debt to another person. In other words, he is the debtor of the creditor.
Debtors and creditors differ from each other in that the latter have the right to demand a return of the debt from the former. Those who borrowed have only one obligation - to return the money.
What is meant by a contractual relationship
Debtors and creditors are often counterparties of each other. The contract in this case should be paid. In such documents, one of the counterparties must sell the goods or fulfill any obligation, provide a service, perform work, etc. The second counterparty must pay for this goods or service within the time period established by the contract. As soon as the delay in payment appears, the overdue person becomes a debtor. Thus, a debtor is a counterparty that has delayed payment under a contract.
Write-off of receivables
It must be remembered that most of the amounts owed are not realized quickly. So, excess payments to tax authorities, as well as financial authorities, can be deducted from the balance sheet only after the amount has been recalculated to account for payments that will be made subsequently. The employees' debts are generally repaid in installments for a long time, by means of deductions from the amounts due to them for payment. There may be persons who left the organization and did not voluntarily repay the debt, in which case, after the statute of limitations expires, the amount of debt is written off as loss. Also, for a sufficiently long period, the amounts recovered from claims are usually not paid.
Writes off accounts receivable, as well as any other debt, accountant, in the period when the next tax period ends. Usually, certain days for writing off such debts are not set. Therefore, as soon as the limitation period for a certain debt has expired, it should be write-off.
Tasks of accounting for settlements with debtors
Equally important are settlements with debtors. The most important part of the accounting documentation is the accounting of debt obligations. On the basis of law, an obligation is always connected with the creditor's right to oblige the debtor to the obligatory performance of the relevant actions. Fulfillment of obligations is a legal relationship, from a certain point of view, specific individuals associated with this legal relationship bear mutual obligations in this legal relationship.
If one person - the debtor - voluntarily performs an action to fulfill obligations, the second person - the creditor - is obliged to accept this performance in any case. If the debtor does not fulfill the obligation voluntarily, the creditor is entitled to apply to the court for enforcement. The court may oblige the debtor to fulfill a compulsory obligation of all his property. Another feature is that the debtor is the debtor, therefore, his obligation can be enforced by the court, and the creditor is not obliged, but has the right to apply to the court, for the debtor to fulfill the obligation.
An obligation always relates to two persons - the creditor and the debtor. You can highlight the main tasks that are set before the function of accounting for settlements with debtors. Among them:
- accounting for cash flows, as well as operations for their movement, which should be complete, clear and accurate;
- observance and control of cash and payment discipline;
- establishing the composition of the receivables, its structure (this includes determining the timing of payment, type of debt, etc.);
- establishing the composition of overdue receivables.
Accounts receivable
Keeping accounting, the employee must reflect the receivables. All debtors must be considered. The account, which takes into account debts of this kind, is formulated in the accounting chart of accounts.
All calculations should be reflected in the following accounts, which in turn, except for numbers, have special names. These are accounts No. 60, 62, 68, 69, 70, 71, 73, 75, 76.
Other debtors
Among all debt holders, other debtors stand out - these are people whose information should be reflected in the column “Other ...” on the article specially provided for this. It combines the most different amounts, which are included in this in one group. This includes tax arrears and employees arrears if they are provided with any amounts, such as loans. Loans can be issued both from the funds of the enterprise or organization, and at the expense of banks. Amounts necessary for damages are placed on the same article. Also referred to this article include the debt of accountable persons, shortages of inventory, debt to suppliers. There are a number of amounts that also apply to this article.
Settlements with other debtors
In an account intended for accounting of settlements with different debts, except for those for which separate accounts are provided, settlements with other debtors are taken into account.
Currently, the chart of accounts incorporates a large number of accounts in order to account for transactions that were previously recorded on account 76, which was intended for settlements with different debtors. Payments to creditors were also taken into account on the same account.
Currently, account 377 is provided, which takes into account settlements with other debtors. Settlements with other creditors are now carried out on account 685. Account 377 is provided in order to take into account settlements with debtors mainly with staff, jointly owned entities , if they are not created as a separate legal entity. As already mentioned above, settlements with staff are made in cases where they were granted a loan or they have other obligations to the employer.
Also, account 377 reflects settlements with various banking organizations, in particular for commissions for servicing by a banking organization and other similar services provided by banking organizations that are not directly related to the activities of any banking institution.