How to Record LC Discrepancy Fees
Accounting for fees charged by a bank when documents presented under a Letter of Credit do not match the LC terms.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Bank Fees and Commissions | Debit | 150.00 | - |
| Cash at Bank | Credit | - | 150.00 |
💡 Accountant's Note
Banks charge discrepancy fees to the beneficiary or the applicant for non-compliant documentation. These are recognized as immediate operating expenses.
Practitioner & Systems Framework
💻 ERP Architecture
Post directly to the bank reconciliation module or as a manual journal voucher against the bank account.
⚠️ Audit Flags
High frequency of discrepancy fees may indicate poor documentation controls in the export department.
📄 Required Documentation
Bank debit advice and discrepancy notification from the negotiating bank.
Automate this entry with the JEH Accounting Suite
Stop doing manual entry. Our VBA-powered ERP automatically generates your ledgers, Trial Balance, and Financial Statements.
No Subscriptions. Own your data.
Expert Analysis by Qusai Ahmad
General Accountant Supervisor & IFRS Specialist
Specialized in SAP GUI automation and Middle Eastern tax compliance. Building digital tools for the next generation of finance leaders.
Related Journal Entries
Supply Chain Finance & Trade Finance
Factoring Without Recourse — True Sale of Receivables (Derecognition Under ASC 860)
Supply Chain Finance & Trade Finance
Factoring With Recourse — Secured Borrowing (Receivables Remain on Balance Sheet)
Supply Chain Finance & Trade Finance
Reverse Factoring / Supplier Finance Program — Buyer's Accounting (ASU 2022-04 Disclosures)
Discussion & Community Questions
Loading comments...