Any Accounts Receivable (AR) debts that make it through TWO cycles of the AR process then become eligible for the bad debt process. The Bad Debt Process aims to clear or "write off" those debts from our books, so that our revenue reports from the PARKS DIRECT system accurately reflect revenue received. Any customer with an outstanding AR (attempted to collect through 2 AR cycles, and is still unpaid) will have that balance cleared and their household frozen by the Help Desk. The dollar value of the balance is deducted from the offering facility's revenue, to reflect the fact that the money was never actually collected.
The customer's household remains frozen until such time as the customer returns to Parks & Recreation to do business. Before conducting any further business with our organization, the Help Desk must reinstate their owing balance and the customer must pay off the debt. ONLY AFTER paying the old debt fully will the customer be allowed to regsiter for new programs or memberships through PARKS DIRECT.
Bad Debt Process Timeline
The Bad Debt Process is initiated at the end of every AR cycle. After the facility management chain (up through Program Superintendents) have had a chance to check and resolve all of their outstanding AR's, a summary of the remaining AR's for each Division will be emailed to the respective Division Chief. These Bad Debt Summary reports will be sent to Division Chiefs 2 weeks after the culmination of an AR cycle, and Divisions will have an additional two weeks to review accounts and verify that the debt is accurate before it is written off. Divisions will also be responsible for generating Material Bad Debt letters for any material debt (see below) within their Division. You can view a sample of a Material Bad Debt Letter below, and can get a fillable version from OneDrive here.
Material vs. Immaterial Debt
Any customer AR debt that is over $500.00 is called material debt, while anything under that dollar amount is called immaterial. During the Bad Debt Process, any material debt (>$500) must be approved by the Planning Board before writing off that debt. An explanation of how the debt was incurred, and what attemps our staff has made to collect the funds, are detailed in a letter. Those letters are presented to the Planning Board to approve/deny the write off for each material debt.
Approved material debts, and all immaterial debts, are written off by deducting the dollar amount from the offering facility's revenue.