HomeMy WebLinkAboutFIN-08-111 - Uncollectable Utility Accounts Write Off1
KITC~~R
Financial Services
REPORT
Report To: Mayor Carl Zehr and Members of Council
Date of Meeting: August 18, 2008
Submitted By: Dan Chapman, General Manager of Financial Services
Prepared By: Joyce V. Evans, Director of Revenue (Ext. 2895)
Ward(s~ Involved: All
Date of Report: August 7, 2008
Report No.: FIN-08-111
Subject: Uncollectable Utility Accounts Write Off
RECOMMENDATION:
That Uncollectable Utility Accounts, amounting to $69,009.03 be written
off against the Allowance for Doubtful Sundry Receivables and the
Allowance for Doubtful Utility Receivables.
EXECUTIVE SUMMARY:
The last write off report for Uncollectable Utility Accounts approved by Council in March 2008
totalling $57,963.19 and covered the period up to the end of December 2007. The current
report reflects Uncollectable utility accounts totalling $69,009.03 for the period from 1999 and
ending June 30, 2008.
BACKGROUND:
The current report represents write off of utility accounts which have been deemed to be
Uncollectable up to the end of June 2008.
At this point in time we continue to manage accounts from 1999 forward. Council approved a
collection policy for utilities which recommended that the targeted upper limit for write-offs be set at
0.3%. Staff continue their efforts in reducing the level of delinquent accounts and to maintain
write-offs at below the targeted upper limit as recommended by Council.
REPORT:
All reasonable efforts have been made by Revenue Division staff to collect these amounts.
These outstanding balances will be written off and will be forwarded to a collection agency.
The cumulative write-offs shown by year as a percentage of total invoices billed, are as follow:
2008 Year to Date Uncollectable Utility Account Write-Off
Detailed summary
Cumulative Write-
offs Total $ invoiced
Year to date Write-offs as a
% of sales
2008 $ 34,441.69 $ 96,286,579 0.0358%
2007 144,247.84 148,670,000 0.0970%
2006 158,382.69 136,419,000 0.1161
2005 169,479.29 131,759,000 0.1286%
2004 201,939.86 121,032,000 0.1668%
2003 368,913.27 114,083,000 0.3234%
2002 454,442.00 106,576,000 0.4264%
2001 481,951.64 107,481,000 0.4484%
2000 445,975.45 88,188,000 0.5057%
1999 111,958.98 84,049,000 0.1332%
Total $2, 571, 732.71 $1,134, 543, 579 0.2267%
If you have any questions or concerns regarding any of these amounts to be written off, we
would be happy to address your concerns.
FINANCIAL IMPLICATIONS:
The cumulative total write off of $2,571,732.71 represents approximately 0.2267 % of the total
utility billings of $1,134,543,579 for the period covered in the report. This is in line with the
recommended targeted upper level for write-offs of 0.3% in the Utility Collection Policy as
approved by Council.
Collection staff has focused their efforts on bringing the level of write-offs down to an acceptable
level as reflected in the results provided in this report. Staff will continue their efforts in
managing delinquent accounts to ensure that the write-offs are at a minimum.
CONCLUSION:
It has been determined that $69,009.03 of utility accounts is uncollectable and staff
recommends that the accounts be written off in August, 2008. The uncollectable accounts
listing will be forwarded to a collection agency, which will use their best efforts to collect these
accounts.
Joyce V. Evans, MPA, FCGA
Director of Revenue
Dan Chapman, MPA, CA
General Manager of Financial