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Write Off Uncollectible Pledges

Goal: Cleanly remove a pledge balance from receivables when collection isn't realistic — donor passed away, lost ability to pay, or won't respond — without losing the historical record.

When to write off​

Don't write off too quickly. Try outreach first:

  • A friendly call from the development director
  • A renegotiation (extend the schedule, reduce the total)
  • Acceptance of a partial settlement

Write off when:

  • The donor has passed and the estate doesn't honor the commitment
  • The donor has experienced a financial hardship and asked for relief
  • The donor is unresponsive after multiple genuine outreach attempts and the receivable is more than a year old
  • The donor's organization has gone out of business

How a write-off works in Ayuna​

A write-off:

  • Marks the pledge balance as written off (the pledge is no longer treated as a receivable)
  • Posts a journal entry that reverses the receivable side of the original commitment
  • Leaves the historical pledge record intact for audit and reporting
  • Does not affect any payments already made

Initiating a write-off​

From the pledge detail:

  1. Click Write Off (or open the actions menu)
  2. Choose a write-off reason from the predefined list
  3. Capture the write-off amount (usually the remaining balance, but can be partial)
  4. Add notes — what happened, who decided, when

The pledge moves to written-off status; the receivable is removed from books.

Reasons to track​

Capturing a clear reason matters for:

  • Audit defense — your finance team and auditors will ask why
  • Pattern recognition — repeated write-offs of the same type may indicate program issues
  • Donor stewardship — the next staff member who reads the donor's profile sees what happened

Common reasons in the predefined list:

  • Donor deceased
  • Hardship (donor request)
  • Uncollectible after due-diligence
  • Renegotiated to lower amount
  • Organization no longer operating
  • Other (specify)

After write-off​

  • The donor's profile shows the original pledge as written off
  • The pledge no longer appears in receivable totals
  • Reports on giving show actual collected amounts, not the original pledge total
  • The pledge can still be referenced in the donor's history

Reversing a write-off​

Rare but happens — donor returns months later wanting to pay. To reverse:

  • Don't undo the write-off; the bookkeeping cost is too high
  • Instead, create a new pledge (or accept the gift directly) for the new commitment
  • Add a note linking to the original written-off pledge

Communications​

When a donor's pledge is written off because they asked for relief, send a brief note acknowledging the conversation and confirming they have nothing remaining to pay. This protects the relationship — silence after a hard conversation makes things worse.

When a donor passes, no communication to the donor obviously, but a note to the family thanking them for the original commitment is appropriate.

Audit trail​

Every write-off is logged:

  • Who initiated it
  • When
  • The reason
  • The amount
  • The new pledge balance after

Annual audit prep includes pulling the list of write-offs for the year and confirming each was authorized appropriately.