First Known Use of write-down
Definition of write down
Examples of write down in a Sentence
a company forced to write down its assets
write down what you remember about that day
First Known Use of write down
write down Synonyms
Synonymsattenuate, break, cheapen, depress, devaluate, devalue, downgrade, lower, mark down, reduce, sink, depreciate, write off
Antonymsappreciate, enhance, mark up, upgrade
Related Wordsdebase, demonetize; underestimate, underprice, underrate, undervalue; abridge, compress, contract, de-escalate, deflate, downsize, dwindle, lessen, moderate, shrink
Near Antonymsbloat, blow up, inflate; overestimate, overprice, overrate, overvalue; add, aggrandize, amplify, augment, balloon, boost, compound, dilate, enlarge, escalate, expand, extend, heighten, increase, maximize, multiply, raise, swell, up
Financial Definition of WRITE-DOWN
What It Is
How It Works
Insurance companies often need to write down assets since they must maintain a certain stated level of capital compared to their portfolio of potential liabilities. For illiquid investments such as real estate, book value is calculated by analyzing current market conditions, taking into consideration rental rates, the values of similar buildings, as well as current interest rates. When preparing quarterly financial updates, insurance firms reevaluate the value of their real estate holdings. If market conditions change, the firm writes down the book value of the holding to adjust the value to current market conditions.
Thus a real estate write-down in our example can be caused by either a negative change in the overall macro environment, or a micro economic occurrence such as building deterioration.
Why It Matters
Changes in book values caused by write-downs were at the heart of financial company failures caused by the sub-prime crisis. When write-downs occurred, many financial firms needed to raise capital from other sources to maintain their minimum capital obligations.
legal Definition of write down
- write down accounts receivable
write-downplay \ˈrīt-ˌdau̇n\ noun
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