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What is the difference between provision for bad debts and allowance for bad debt?

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Question added by Mubeen Ahmad , Head Internal Audit , FF Steel (PVT) Ltd.
Date Posted: 2013/06/24
Mohammed Salim Allana
by Mohammed Salim Allana , Compliance and Assurance Manager , United Arab Bank

Both are same, having difference in translation from Arabic to English.

Muhammad Fawwad
by Muhammad Fawwad , Accounting Manager , Jazera Access Co. Ltd

Both are same and appears as balance sheet item

shaik Shaik qayamuddin
by shaik Shaik qayamuddin , Finance & Account Manager , G S Oils Limited Adilabad

Provision for bad debts and allowance for bad debts are identical to each other this will not have any impact on income statement it can done through journal entry

Hassanain Ullah Jan CPA  ACCA CGA
by Hassanain Ullah Jan CPA ACCA CGA , Finance Manager , BIAC

There is no diference between these. Actually is contra receivable account which will be reviewed on adjustable event to reflect the impact on Financial statements. 

Bandar AlHadad
by Bandar AlHadad , مختص شؤون مالية , قطاع حكومي

The provision for bad debts might refer to the balance sheet account also known as the Allowance for Bad Debts, Allowance for Doubtful Accounts, or Allowance for Uncollectible Accounts.
In this case Provision for Bad Debts is a contra asset account (an asset account with a credit balance).
It is used along with the account Accounts Receivable in order to report the net realizable value of the accounts receivable.

Nagoorammal Abdul Rahman
by Nagoorammal Abdul Rahman , Finance Manager , Vox Spectrum Limited

to the best of my knowledge, the word provision is used by me like Indians and other related/neighbourhood countries.
in the US books i see the word allowance.
both are similar terms as i use.
correct me if i am wrong.

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