Ravi Duseja (Article) 10 December 2019
Since Provision for bad Debts is non cash item no adjustmemt in cash flow is required.
In Case Current Yeay any Provisiom is done for debtors as doubtfull, same should be adjusted in working capital to ensure cash collection from debtors is not inflated due to this adjustments.
TAPASYA (CA) 23 May 2020
If you are preparing Cash Flow statement with indirect method and there is an increase in provision of bad debt in current year, please add back this amount to Net Income/Loss.
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