Write Back is an accounting process where a previously written-off expense, loss, or liability is reversed because the amount has been recovered or is no longer required.
Write back is used in accounting and finance when a company recovers money that was earlier considered a loss or when an estimated expense turns out to be lower than expected. It improves the company’s financial position by increasing profit or reducing expenses in the period in which the write back occurs.
Common situations where write back is applied include:
Write backs must be properly documented and are recorded in the profit and loss account. They help present a more accurate and fair view of a company’s financial performance.
"A company writes off ₹1,00,000 as bad debt. Later, the customer pays ₹40,000. This recovered amount is recorded as a write back, increasing the company’s income."