Hello,
I had a few invoices that I knew wouldn’t be paid and so at the end of the year I added a journal entry:
debited (8102) Bad Debt Provision
and
credited (1106) Provision for Doubtful Debts
The next year credit notes were issued for these invoices, what shall be done with the bad debt provision now ?
I think you would have to delete the credit notes. as you already have raised a journal entry for that specific invoice.
Raising a journal and then raising a credit note would bring back the amount onto the ledger.
So in such cases, if the amount is a bad debt you should not raise a credit note.
I hope it helps.