Write-offs

Write-offs are reductions in the value of an asset or an expense that a business recognizes for accounting or tax purposes. They typically represent items that have decreased in worth or are no longer recoverable, such as bad debts, obsolete inventory, or damaged equipment. By writing off these items, businesses accurately reflect their financial position, reducing taxable income and providing a clearer picture of actual profits. Essentially, a write-off is an acknowledgment that certain costs or assets are no longer beneficial or valuable, allowing the company to adjust its financial statements accordingly.